Bullish Case: With mean reversion patterns and a slight uptick in implied volatility, YANG may see short-term recovery as traders react positively to recent market sentiment and economic developments.

Bearish Case: Despite potential short-term gains, long-term bearish momentum remains due to poor historical performance, high implied volatility, and external geopolitical risks impacting Chinese markets.

Potential Outcomes:

• 30% chance of a strong bullish spike driven by positive economic news.
• 50% likelihood of price stagnation or slight declines due to continued bearish trends.
• 20% chance of sharp price drops if geopolitical tensions escalate further.

Trading Oracle: Given the current scenario, consider a bullish debit spread by buying YANG $78 calls and selling $80 calls (expiring in 2 weeks). This targets short-term gains on unlikely dips while capitalizing on the existing mean-reversion patterns, minimizing risk exposure with an attractive risk/reward ratio.

December 03, 2024