We’ve spent the last several months bringing you inflation-beating ideas in Monday’s column, but with inflation coming down, I want to switch things up and bring you a taste of the “out of the box” trading we’ve been doing in my Hyperdrive Portfolio service.

So, welcome to the new Monday column, which I’m going to call Flip the Chart. I’ll be bringing you one options trade you can place today on a stock that is likely to experience a fast reversal, either to the upside or the downside, so you can make some quick cash when the stock moves. Get in, get your profits, and get out. Simple.

This week, I’m looking at a tech company that engages in the design, development, marketing, and sale of semiconductor-based power electronics solutions for the computing and storage, automotive, industrial, communications, and consumer markets.

They just reported earnings and the stock gapped up as much as 14.46% in the following session. Now it looks like it’s coming back down to earth to fill that gap, and we’re going to get in on a put spread before it falls.

The company is Monolithic Power Supply, Inc. (MPWR), based out of Kirkland, Washington. Prior to last week’s earnings and subsequent gap up, the stock had experienced a nice run, as you would expect a semiconductor company stock to do in the recent overall market rally – but shares feel overheated and I think we’re going to see them reverse, at least long enough for us to “flip the chart” and grab a quick profit.

I like buying the MPWR March 17, 2023 $490/$480 Put Spread for $5.25 or less. Only target this trade if you can fill it today. Capture profits at 30% and exit the trade if the spread is down 50%.

That’s it. Straight to the point.

Check back in next [week] for another profit opportunity.

— Shah Gilani

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Source: Total Wealth