Price Forecast:

Bullish Case: MTB shows bullish sentiment with a 54% greater demand for calls than puts, and the implied volatility is stable around 30%. Historical growth trends support the potential for significant price recovery.

Bearish Case: Increased implied volatility and a backwardation term structure suggest heightened market uncertainty. Recent declines may indicate ongoing risks in the banking sector, impacting MTB negatively.

Potential Outcomes:

1. 60% chance of price recovery driven by bullish sentiment and stable fundamentals.
2. 25% chance of stagnation due to economic pressures and external market conditions.
3. 15% chance of further decline influenced by increased market volatility.

Trading Oracle: Consider initiating a bullish debit spread by buying the $190 call and selling the $200 call, expiring in January 2025. This strategy leverages positive sentiment and low implied volatility while limiting downside risk. Aim for a high reward-to-risk ratio amidst bullish outlook.

December 21, 2024