Nobody Else Is Trading PLTR Right Now. Tony Is.

Why It Matters

Earnings‑driven volatility spikes let traders harvest premium on low‑IV stocks, offering a timely income opportunity for directional options strategies.

Key Takeaways

• Palantir's IV rank is low at 4, limiting premium selling.
• May weekly options show 77% implied volatility ahead of earnings.
• June options carry 60% IV, creating a 10‑point vol spread.
• Selling upside calls on May expirations aligns with directional bias.
• Earnings on May 4 drive volatility differential and trading opportunity.

Summary

The video features trader Tony outlining an options play on Palantir (PLTR) despite the stock’s unusually low implied‑volatility (IV) rank of four. He emphasizes his preference for selling premium and explains that a low IV rank typically makes premium collection difficult, yet the upcoming earnings event creates a unique window.

Tony points out that the weekly May 8 options are priced at a 77% IV, the regular May monthly options sit at 70%, and the back‑month June contracts sit at 60% IV. This roughly 10‑point volatility differential stems from the May 4 earnings announcement, making the near‑term options considerably richer than the farther‑out series.

He argues that traders with a directional bias—particularly those expecting downside movement—can sell upside call spreads on the May expirations to capture the inflated premium. As he notes, “We like selling premium… high IV rank closer to 30, 40, 50, 60, and above,” highlighting that the earnings‑driven spike temporarily substitutes for a high IV rank.

The implication is that savvy options traders can exploit earnings‑induced volatility spikes to generate income, but they must remain cautious of sharp price moves that could erode the premium collected. This strategy underscores the importance of timing and volatility differentials in short‑dated options trading.

Original Description

IV rank of 4 usually means walk away. On tastylive's Options Trades Today, Tony Battista shows why Palantir is different: earnings on May 4th have pushed the May cycle to 70% implied volatility while June sits at 60%. That 10-point differential is the trade. Sell elevated near-term vol, buy cheaper back-month vol, and build a bullish diagonal into the earnings event.

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