META looks overvalued after its sharp rise from $520, making a downward move more likely despite a bounce off 681 support. The 735-738 descending trendline and 740 peak have repeatedly rejected price, including last week; he expects that zone to cap META and is positioning for a drop around earnings.

We will not cover Tesla. We will take a look at the setup in Meta.

So, now we will delve into the graphs. Here we are. Look at Meta. you guys. I am looking at Meta. Currently , the 680 level here, 681, is a major support level. This was a resistance level when the price was rising.

As you can see, we touched this level several times and then finally broke through to the top. Now, Meta has started selling and as we can see, we've dropped to 681 and the price has clearly bounced back.

A long wick demonstrates significant purchasing power. Now, with this, the price is pushing up again. So, during the day, we have already risen by two and a half percent in Meta stock and we are still continuing to rise.

Furthermore , we have an earnings announcement after the market closes.

Currently, the prevailing sentiment is that Meta is rising and has made a clear bounce off the support level . So, everyone thinks that SpaceX was bullish, and therefore everyone should be optimistic about Meta, right?

Maybe , but guess what? I'm going to look at it from the opposite angle today. I will go against the grain . I want to set up a put option position on this stock. Perhaps... I'm not really interested in the report itself, nor in the revenue or earnings per share.

I'm only focusing on price movement, okay ? I still think the stock has been overvalued since the summer . Look at this. All the way from the low levels of $520. I'm not sure of the exact percentage at this moment, but look at this sharp upward move and then the slight pullback here.

I still believe this makes a downward move more likely .

So, with that said, let me outline some resistance levels. Currently, Meta is trading at $711. Therefore, I have significant resistance at a pivotal peak here. This resistance is located at 740.

This is the blue line here at the top. As we can see , the price surges towards this level, then is reversed. Here too, it was answered. We have a few extreme cases where the price exceeds this level, but this is where this trend line comes in.

Now, I want you to take a look at this white trend line . This starts from the peak of August 15, 2025. It is descending, and the price is rejecting here in November. Then it now interrupts the price movement.

Yes, the price crosses this line , but as we can see, it retreats, returns to try to rise, and continues to return to this level. And when the price is rejected from that level, all these wicks extending towards that level also appear.

So, we now have this final test of this trend line, which you can see here. Why isn't it showing up for me? This happened last week, where this trend line stopped the price twice.

And now he is making another attempt to climb up. So, with this, the level now reaches approximately 735 to 738.

Okay? What I'm thinking about here is buying a put option before earnings, and I'm betting on this support zone, the pivotal 740 peak, and the downtrend line that rejected the price last week.

I think this combination here has the potential to stop the price. So, I'm looking to buy a put option here in the 730-740 range.

As I said, this isn't a typical setup we usually do, but it's one we're looking to trade today. Make sure you specify your levels with Meta.

Will the execution price, let's say meta, be at 711?

Okay, guys. I'm looking at the series now . We have a "meta" in front of us and I am looking at the side of sales contracts, not the side of purchase contracts. I don't rush things, and I don't suffer from FOMO (fear of missing out ).

I will defy expectations here. Now, we'll just look at one decade, and yes, I would rely on a faster timeframe. I'm looking at the 30-day series here. We usually look for 30 to 45 days for our thesis to become clear, but the price stabilized tonight.

So, sometimes you have to take risks. Yes. We need to expand our list first. We are looking for execution prices higher than 735 to 740. mmm. Let me see if I can add more execution prices.

There are many of them. Okay, here we are. Good. Here below, no. I'm looking at the 735 to 740 range. There are some good options. Yes. Now, I know that this contract is priced at around 5000.

So, the bid price is at 5170, and the ask price is at 5225. Oof. If we bought this, it would be a deal worth approximately $5100. Oh. Considering the 740 and 735, the 740 option is expensive.

I know, I mean we're already paying a high price, mmm. In exchange for this day. Therefore, I will choose a cheaper option at an execution price of 735. Now , with this, we have a "delta" of 0.5.

Beautiful. Approximately 666. Tabi thinks it's beautiful. And why is this delta negative, Tabi? Because it is a sales contract. We want it to go down. Yes. Yes, we want it to go down, and that's why Delta is negative.

Now, Tabi, what if we had a purchase agreement here? What will the delta look like? Positive. It will be 0.5. good. So, I'm looking at this sales contract 735. Hmm. There is some trading volume coming in today.

We have a lot of trading volume here at the price of 725 . Yes. Yes, there is open interest as well. But we will stick to our thesis . Okay . Now, the picture, as I said, is that we are going against the grain , with the trading volume of buy and sell contracts today at 0.49.

Hmm. Tabi, is this trading volume old news or new? Trading volume is news. This is correct. It's new money entering the market. So, it's an upward reading . We know that the earnings will be announced tonight.

Therefore, that bonus will be high. Okay . Because of the uncertainty. Yes. So, we will pay a higher price for this trade. We are at the 90th percentile of implied volatility, but that's what's fun in profit trading .

So, this is today's deal. I am looking at an execution price of 735 for a sell contract that expires in 30 days.

amazing. amazing. Let's look at the final graph to summarize the day. The deal was on Meta for a sell contract at $735, which means we expect a drop. The expiry date is November 20, 2026.

So, it's fairly close . It's getting closer. Our "delta" value is 0.571, which is within our range. Oh, negative. Yes, in this matter, as we have explained. The negative 0.571 must be within the range.

Our approach is to trade against the current trend, ahead of tonight's profits. The percentage for implied volatility is 88, which means the premium is expensive. We are paying a high price, but we are betting on the support level being rejected and the price going down.

So , it would be really exciting if that happened. It will happen. certainly.