Bullish Case: PDD's strong revenue growth and successful expansion strategies, notably through Temu, highlight its potential for sustained upward momentum. This is supported by high call option volumes indicating bullish sentiment.

Bearish Case: Regulatory challenges and fierce market competition pose significant threats to PDD's growth. The persistent high volatility reflects market uncertainty, suggesting potential negative impacts on the stock.

Potential Outcomes:

• 50% chance of steady growth fueled by successful international expansion.
• 30% chance of price decline due to regulatory pressures.
• 20% chance of flat performance amidst market uncertainty.

Trading Oracle: Consider a bullish call debit spread by buying $115.00 ITM calls and selling $120.00 OTM calls expiring in March 2025. The structure leverages current low implied volatility with potential price appreciation, offering a favorable risk-reward profile.

January 26, 2025