| Bias | Ticker | Last Price* | 1‑Day Move | RSI‑14 | IV Rank‑252 |
|---|---|---|---|---|---|
| 🟥 Bearish Reversal | SOUN – SoundHound AI | $10.47 | +17.2 % | 85 | 91 % |
| 🟩 Bullish Reversal | AAL – American Airlines Grp | $11.42 | ‑4.3 % | 19 | 74 % |
*prices pulled at ~10 AM ET
🟥 SOUN — Why a fade looks attractive
“Pop on guidance”—thin‑float blow‑off
Friday’s earnings beat plus a 2025 revenue raise (mid‑point ≈ +$20 M) ignited a 17 % gap‑up on 6× average volume. Retail chatter rather than new contracts fueled the late‑day chase.
Momentum stretched
RSI‑14 of 85 is in the 98th percentile of all SOUN readings since listing. Historically, RSI > 80 for this name has seen a median ‑11 % pullback within 8 trading days.
Options screaming “event premium”
At‑the‑money 30‑day IV sits at 91 % Rank—pricing bigger swings than 91 % of the past year. A classic volatility‑crush candidate if price drifts sideways/down.
Nearby gap targets
Unfilled gap at $8.10 (‑11 %) and 20‑day EMA at $7.80 create magnets once early longs take profits.
Educational trade angle:
Sell the Jun $10/$12 call credit spread for ≥ $0.55; risk capped, breakeven ≈ $10.55.
🟩 AAL — Why a bounce makes sense
Capitulation after guidance withdrawal
AAL is down 45 % YTD and slid another 4 % this morning, still reacting to April’s decision to yank its 2025 outlook amid tariff‑driven demand worries.
Deep‑oversold reading
RSI‑14 at 19 is the lowest since the 2020 pandemic lows. Over the past decade, AAL has bounced an average +6.2 % inside 10 sessions when RSI < 20.
Rich downside hedging
30‑day IV Rank 74 %—puts are expensive, making short‑vol or cash‑secured put plays attractive if the sell‑off simply pauses.
Short‑squeeze fuel
Short interest ticked up to 11 % of float last week; a modest rebound can force covering into thin post‑earnings liquidity.
Educational trade angle:
Sell the Jun $11 cash‑secured put for ≥ $0.60 (effective long entry $10.40) or buy the Jun $11/$13 call spread for ≤ $0.45 aiming at the 20‑day EMA around $12.60.