STX market share is not significantly threatened by Toshiba's production increase; the stock remains strongly positive year-to-date despite a recent pullback.

Despite last week's decline, it's still a great year for Seagate Yes, I think if you look at Seagate's fees, you'll see that decline and strong sales due to the news from Toshiba, which may double its production of hard drives.

However, this will not significantly affect the market share of Seagate and Western Digital. However, I wanted to give you context regarding Seagate's long-term chart , where you can see here in the three-year weekly chart that we were at the $68 level three years ago.

So, we have risen even though we have seen some fluctuations and some volatility here. We have risen by more than 1140% from those levels over the past three years. Therefore, the situation was great for investors who held onto the stock over the past two years.

I have another chart that is somewhat short-term. It gives you a simple reflection of the volatility we have recently witnessed, and the retreat from its all-time highs . Here, this is a daily chart for one year.

We reached those record levels in June at around $1145. Well, we've fallen by about 26% by Friday's close. So, we are in a bear market area even though we are seeing some recovery in stocks today by a small percentage with this rebound, as analysts come out and say, " Hey, everything is fine with the Toshiba news."

"Seagate will still perform very well." But you can see the fluctuation we've seen recently here. The stock is still up by more than 208% so far this year.

We only fell below the 50-day simple moving average last Friday. You see that big green candle where we rose from the bottoms. You can see that. We will open trading above that level today. We will open trading at around $870.

Now , start by taking a look at some size profiles to see where support might be. Well, we have had repeated support at this level right here, just below the 800 level . We will return above that 50-day simple moving average.

You have a large line here at 800. That will be a support zone. We have more support here at around $840. If we see some pullback, the 800 and 840 levels could act as support zones for the stock here.

Now, look at the Relative Strength Index (RSI). We saw that big drop due to the news last week where we fell below the 50 level. So, the momentum is waning a little, but this should reverse relatively quickly today, Diane, as the stock has risen by more than 2 %.

Well, with a high- priced stock, $870, you have to be a little careful . I have chosen a slightly negative approach where I can still take a directional bias at Seagate Technology if I am optimistic, right?

But I don't have to be aggressive about it. I can use a deal with a high probability of success here. So, the trade I looked at is a neutral to bullish vertical put option trade where I would sell an out-of-range put option.

I will choose the option of October 16th. Therefore, there are only 11 days left until the expiry date. A really short-term positioning with expectations that the 840 and 800 levels may hold going forward, giving me a better probability of success.

So, we will sell the put option at 800 and buy the put option at 780. Therefore, a neutral to bullish vertical sell trade with a bid of $20. The stock opens here at around $870.

You will likely receive a credit of approximately $450. So , this is your profitability. You can earn $450 per team with a risk of approximately $1550. But if I get this balance of $450, look where the breakeven point goes, it drops to $795.50 .

This represents about 8.5% below the $870 level at which the stock appears poised to open. So, you have that large margin on the underside for protection. Now, you win in three out of four scenarios.

Whether the stock rises, stays in place, or falls. Even if you are wrong, but the stock remains above the breakeven point at $795.50, you will be a winner in this trade. Now, the sell option at 800 that you are selling has a high probability of success, as I mentioned.

There is approximately a 70% chance that the put option at 800 that you sell in this strategy will be out of range at expiry. So, those swaps we're talking about, Diane, where I risk $15.50 to earn only $4.50 , but I have a very good chance of being profitable in this trade as long as the stock stays above the breakeven point of $795.50 for the next 11 days.