Bullish Case: Expectations of increased infrastructure investments could drive BSY's price upward. The current implied volatility suggests market uncertainty may be decreasing, favoring upside potential. Positive earnings surprises could enhance sentiment.

Bearish Case: Increasing competition from Autodesk and a high price-to-book ratio signal potential overvaluation risks for BSY. Continued flat price action and elevated put volumes support a bearish trajectory.

Potential Outcomes:

1) Infrastructure investments increase, 60% probability.

2) Autodesk competition escalates, raising downside risks, 30%.

3) Earnings surprise positively, 40%.

4) Market correction due to overvaluation, 20%.

Trading Oracle: Implement a bullish debit spread by purchasing BSY $50 calls and selling $55 calls, targeting near-term gains as implied volatility normalizes. Focus on positions expiring in December for optimal risk/reward, while moving past short-term volatility.

October 20, 2024