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ADI Covered Call Analysis: Proceed With Caution Weak · 55/100
Analog Devices Inc (Technology) · $370.24 ·
Analysis generated Aug 21, 2026 ·
Data as of market close Aug 21
Quick Take
ADI is trading at $370.24 with RSI at 47 (neutral territory). Options IV is at 39% — 62% below its 30-day average of 104%. Neither RSI nor IV strongly favor selling calls right now. Consider waiting for better conditions or using a different strategy.
Technical Signals
RSI (14)
47
IV Today
39.3%
IV vs 30d Avg
-62%
MACD
bullish
ADX
14
MFI
53
The Setup
ADI Covered Call
LONG STOCK
100 shares @ $370.24
SHORT CALL
$400 Oct '26 · $12.03/sh
Net Cost
$35,821
Max Profit
+$4,179
Break-even
$358.21
Projected P&L at Target
+$4,179
(11.7%)
P&L at Expiry
P&L Scenarios
What happens at different ADI prices by expiry:
| ADI Price | Today | Sep 8 | Sep 27 | Oct 16 (exp) |
|---|---|---|---|---|
| $296 (-20%) | -$6,275 | -$6,222 | -$6,203 | -$6,202 |
| $315 (-15%) | -$4,537 | -$4,422 | -$4,357 | -$4,351 |
| $333 (-10%) | -$2,904 | -$2,698 | -$2,534 | -$2,499 |
| $352 (-5%) | -$1,425 | -$1,113 | -$792 | -$648 |
| $363 (-2%) | -$626 | -$254 | +$176 | +$463 |
| $370 (0%) ← now | -$136 | +$273 | +$771 | +$1,203 |
| $378 (+2%) | +$320 | +$760 | +$1,320 | +$1,943 |
| $389 (+5%) | +$939 | +$1,413 | +$2,042 | +$3,054 |
| $400 (+8%) ← target | +$1,486 | +$1,978 | +$2,640 | +$4,179 |
| $407 (+10%) | +$1,798 | +$2,292 | +$2,955 | +$4,179 |
| $426 (+15%) | +$2,454 | +$2,927 | +$3,527 | +$4,179 |
| $444 (+20%) | +$2,935 | +$3,357 | +$3,839 | +$4,179 |
Why This Strategy, Why Now
- RSI at 47
- IV -62% vs avg — premiums below average, less income
- MACD bullish — stock has upward momentum
- ADX at 14 — range-bound, perfect for selling calls
- TTM Squeeze ON — breakout imminent, risky for capped strategies
Key Risks
ADI has bullish momentum (MACD). If a positive catalyst emerges (earnings beat, product launch), the stock could gap past your strike. Consider rolling the call up if ADI approaches the strike before expiry.
TTM Squeeze is ON — a volatility breakout may be imminent. If the breakout is to the upside, your short call will be tested quickly.