How Options, Technical Traders Are Gearing Up For Uber Earnings

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Uber Technologies Inc (NYSE: UBER) is expected to report its first-quarter 2021 earnings results on May 4.

On Tuesday a number of options traders bet over $585,338 Uber’s stock is going to run up into its earnings event and Uber’s stock looks ready for a bullish break.

The Uber Chart: Uber’s stock has been consolidating in a bullish ascending triangle pattern after making a new all-time high of $64.05 back on Feb. 11. The stock has been making daily higher lows and topping out at resistance at the top of the ascending triangle at $60.75.

Each time Uber’s stock hits the upper resistance level the weaker the resistance becomes.

Uber’s stock is trading above both the eight-day exponential moving average (EMA) and the 21-day EMA, with the eight-day EMA trending above the 21-day EMA which is bullish. On Tuesday these two commonly followed EMAs were acting as support for Uber’s stock.

Bear volume has been declining over the past 10 trading days indicating the stock is running out of sellers.

See Also: Is Now The Time To Buy Stock In Uber, Lyft Or GE?

Bulls want to see bullish volume come into the stock to break it up over resistance near the $60 level. If it can bust through that resistance level it has room to trade up towards all-time highs at $64.05

Bears want to see Uber’s stock unable to break through the overhead resistance and for bearish volume to knock it down out of the ascending triangle. If the stock begins to trade below the triangle it has support at $56.02. If Uber’s stock is unable to hold resistance there it could drop down towards the $50 mark.

The Uber Option Trades: Below is a look at the notable option alerts, courtesy of Benzinga Pro:

  • At 10:26 a.m., Tuesday a trader executed a call sweep, near the ask, of 265 Uber options with a $59.50 strike price expiring on May 7. The trade represented a $39,000 bullish bet for which the trader paid $1.50 per option contract.
  • At 10:27 a.m., a trader executed a call sweep, near the ask, of 258 Uber options with a $59.50 strike price expiring on May 7. The trade represented a $38,958 bullish bet for which the trader paid $1.51 per option contract.
  • At 11:06 a.m., a trader executed a call sweep, at the ask, of 1497 Uber options with a $70 strike price expiring on May 7. The trade represented a $37,425 bullish bet for which the trader paid 25 cents per option contract.
  • At 12:21 p.m., a trader executed a call sweep, near the ask, of 558 Uber options with a $60 strike price expiring on May 7. The trade represented a $78,120 bullish bet for which the trader paid $1.40 per option contract.
  • At 12:22 p.m., a trader executed a call sweep, near the ask, of 620 Uber options with a $60 strike price expiring on May 7. The trade represented a $88,040 bullish bet for which the trader paid $1.42 per option contract.
  • At 12:29 p.m., a trader executed a call sweep, near the ask, of 392 Uber options with a $60 strike price expiring on May 7. The trade represented a $58,800 bullish bet for which the trader paid $1.50 per option contract.
  • At 12:47 p.m., a trader executed a call sweep, near the ask, of 981 Uber options with a $60 strike price expiring on May 7. The trade represented a $149,112 bullish bet for which the trader paid $1.52 per option contract.
  • At 12:47 p.m., a trader executed a call sweep, near the ask, of 371 Uber options with a $60 strike price expiring on May 7. The trade represented a $56,763 bullish bet for which the trader paid $1.53 per option contract.
  • At 12:21 p.m., a trader executed a call sweep, near the ask, of 558 Uber options with a $60 strike price expiring on May 7. The trade represented a $78,120 bullish bet for which the trader paid $1.40 per option contract.

Why It’s Important: When a sweep order occurs, it indicates the trader wanted to get into a position quickly and is anticipating an imminent large move in stock price. A sweeper pays market price for the call option instead of placing a bid, which sweeps the order book of multiple exchanges to fill the order immediately.

These types of call option orders are usually made by institutions, and retail investors can find watching for sweepers useful because it indicates “smart money” has entered into a position.

UBER Price Action: Shares of Uber Technologies closed Tuesday at $57.16.

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