Price Forecast:

Bullish Case: The UTI stock's implied volatility is forecasted to increase, indicating rising market confidence driven by strong call option volumes, which supports potential gains. Historical price returns suggest positive long-term trends, especially with upcoming earnings reports.

Bearish Case: Current market uncertainty reflected in high implied volatility for near-term put options indicates risk. Short-term price resistance around $27 suggests potential stagnation or pullbacks if upcoming earnings disappoint or macroeconomic conditions worsen.

Potential Outcomes:

• Positive earnings surprise (40%): Expected earnings boost price significantly, potentially above $30.
• Sector-wide downturn (25%): Broader market issues could pull UTI down to $22.
• Flat earnings (35%): Stagnation, price hover around current levels ($26).

Trading Oracle: Consider executing a bullish call debit spread using UTI 12/20/2024 $27.50 and $30.00 calls, capitalizing on the upward volatility and market expectations. This strategy limits risk while allowing for significant upside if UTI performs well in the next earnings report.

December 13, 2024