PANW is near all-time highs but rolling over (down 4% today) with RSI bearish divergence at the 432 high, a bearish put setup for a move lower. It needs a break below 400 to activate; target 370-380 within a couple weeks to two months, with 370 a wall it should not pass. Prefers 39-67 day puts.

So I have a key setup today. I'm looking at PANW. Paulo Alto, the software beast has been on a great run lately. Well, guess what? I'm going to look at I'm going to It's selling off today and I'm going to see if there's some key levels that we can make a trade setup with.

All right, so PanW, I'm looking at this longterm parallel channel here. This is an indicator that I haven't used with you yet, guys, but this is like two trend lines kind of in fashion just like this.

And if we look here, this parallel channel long-term is starting from the March 27th, 2026 low. That way you guys can chart with me. So, let's do it together. We're charting from the swing low here, and we're bringing it all the way up through current action.

But where do we anchor the top two? We're going to anchor it to the top of these candles here. So, uh, right here at 368. these two pivots right here and this other pivot at about 400.

So with that we have a ton of hits on each side of the trend line. It kind of contains price if you will.

Okay. With that we have price starting to roll over today as we see just today that Paulo Alto is down 4% right here. So okay, we're near all-time highs and we're getting a good sell starting to come in.

I think we should I do think that this move favors a move lower. So with this I'm thinking of a bearish setup or when it comes to options I want to buy a put for this setup. So now as I kind of have that uh a thesis of I think price is going to continue to go down.

Well, one, we got to see if um Paulo Alto is going to break this 400 level. That's going to make or break our trade just from the get-go pretty much. As we see, we pushed up here and set this new all-time high coming in at about 432, this large wick right there.

Okay. Now, with that though, as price keeps coming in, we're staying above 400. So, now price has found support at the $400 handle. So, and today even though we're pressing lower, we're still staying above at 40216.

Okay. This is one of my key factors that I I one of my key indicators that I use in my as a technician. This is called RSI bearish divergence. Okay. So this is when right here price pushed up to a new relative high and right here RSI or the momentum index pierced above 70 or it was in oversold territory.

May I want you to look down here at this RSI at the lower quadrant as you see we're piercing up as price pushed here. Okay, pause on that one. Now we went down to the lower boundary of this parallel channel.

We see we bounced off it there, strengthening that channel. And we're continuing to push back up. But we pushed back up to new highs coming in at 432. But look at RSI. The momentum is fading at that height when we made a new all-time high.

RSI was coming in at at 67, much less than where it was over here. pretty much meaning that this stock is losing um some steam and could be coming in to the downside.

That gives me more conviction with my bearish thesis. Okay, Jake. Now, where's the target? So, first thing is we like I said, we'd have to break that 400 for that thesis to really come into play.

Now, with that, there's the bottom of this parallel channel with this pivot top here intersecting at 368 370. I think that for now is going to be a major wall within the next couple weeks, two months.

So with that, my target is should is kind of in the middle. So I'm looking if we can see a options setup a buying a put and with a target of about 370 to 380. That would kind of give us room to if we broke the 400 to profit if we can in that in that area.

But then as I said, I don't think price is getting past that 370.

so say so, uh, PANW right now is at 402. If we're sitting at that 40 400 strike, then around at that money price, that's when Theta is going to be booming, bleeding more.

All right. I am looking at pan W, Paulo Alto, and I'm went to that top uh side here where we type it in just so you guys have a clear understanding how I get there because I want you guys to do this with me.

Now, from here, I'm going to go to options. And then I have these metrics laid out uh so I can kind of gauge the sentiment of it. And then for the listings in here, I have the bid, the ask, and then a few of the Greeks, delta, theta, and gamma.

4402.5. I want you to look at the theta column. What is that number? It's negative a dollar. Yes. Negative a dollar. Okay. Now, that's at the money. Remember guys, that's at the money because we're That's why it's high.

Nice. So, now I want you to go to 385. Yeah. 78 cents. Ne Yeah. Negative 78 cents. Yes. Correct. And then go to 417. 417 negative. Oh, 85 cents. Correct. So, um a little off. Yes.

But as the whole picture as we move further away from at the money then theta gets lower.

Now point two um how many days is this left till expiration? 4 days. Okay. 4 days. Now I just want you to take the 400 strike. Now tell me that theta. Uh it's negative a dollar.

Okay. Now let's go to the same strike but 39 days out. Okay. About Thanksgiving time and now we're atgative 38 cents. Or is that okay? 38. So, okay. So, now we're getting less as we have more time to play out for a thesis.

Now, one more further out. 29 cents and 29 cents. Nice. All right. Goes down 10 cents like each. Exactly. Yes. So, now we nailed those two points that we wanted to learn about theta.

I'm looking at a bearish setup. So, Tabby, what would I be buying here? A put. A put. All right. And with that, um, four days, that's not enough. I'm not, uh, I'm not jumping off a cliff, uh, trying to catch, uh, this PNW trade with a put.

I'm looking at the 39 to 67 days out. I'm looking at a 390 to 380 target.

The deltas are I delta's coming in at.3 and.38. And why is my delta negative here? Um because we're looking for a put. Correct. So what would my delta be if I was looking at a call?

It would be positive. Nice. Good job. But it's not quite at that point. I know. Even at 39 days, 67 days, that's more enough time for our price action. something volatile like PNW to get to that target.

Yeah. Uh we don't want to overpay for a thesis. So we're trying to force a thesis here that's not fitting. Our delta is not hitting the threshold that we want for our exposure.

And the trend we're fighting a bullish trend right now which is coming in at 0.82 which is a call bullish lean. So we're fighting the