Caesar’s (CZR) – CZR has been one of the few gaming and casino stocks that have held up above its 200 day moving average this year and is a best in class name compared to peers with higher risks. The $20B casino is still up +29% YTD while others languish. CZR peaked up near 119 at the end of September and has pulled back to its 200 day EMA and near YTD VPOC support at 95. This should be a level it finds a base and bounces back from as RSI is now nearly as oversold as it was in July when the stock bounced off its 200 day and rallied to new highs. CZR has been public for 7 years now and seasonally thrives in the year end period with November average returns of +16.9% and December being up 6 of 7 years for an average gain of +6.5%. Looking for the 90 level to hold into year end sets up a nice bull put spread opportunity. Large traders seem to agree lately positioning bullishly looking forward with plenty of action in the March expiration. March $110 and $120 calls still in open interest from late October buys of over $3M combined. Also puts sold to open at the March $100 strike for over $1.4M and Jan $110 put strike for $1.3M still in open interest showing confidence shares recover back above those levels.

Trade to consider: Sell CZR January 90/85 put spread for 1.70 credit or better