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Why SHOP Is an Excellent Covered Call Candidate Right Now Strong · 85/100
Shopify Inc (Technology) · $122.54 ·
Analysis generated Jul 10, 2026 ·
Data as of market close Jul 10
· Market closed — data may be from last trading day
Quick Take
SHOP is trading at $122.54 with RSI at 60 (neutral territory). Options IV is at 64% — 17% below its 30-day average of 77%. Neither RSI nor IV strongly favor selling calls right now. Consider waiting for better conditions or using a different strategy.
Technical Signals
RSI (14)
60
IV Today
64.3%
IV vs 30d Avg
-17%
MACD
bullish
ADX
17
MFI
70
The Setup
SHOP Covered Call
LONG STOCK
100 shares @ $122.54
SHORT CALL
$130 Sep '26 · $11.4/sh
Net Cost
$11,114
Max Profit
+$1,886
Break-even
$111.14
Projected P&L at Target
+$1,886
(17.0%)
P&L at Expiry
P&L Scenarios
What happens at different SHOP prices by expiry:
| SHOP Price | Today | Aug 3 | Aug 26 | Sep 18 (exp) |
|---|---|---|---|---|
| $98 (-20%) | -$1,576 | -$1,448 | -$1,341 | -$1,311 |
| $104 (-15%) | -$1,105 | -$936 | -$771 | -$698 |
| $110 (-10%) | -$676 | -$470 | -$242 | -$85 |
| $116 (-5%) | -$292 | -$54 | +$232 | +$527 |
| $120 (-2%) | -$83 | +$170 | +$486 | +$895 |
| $123 (0%) ← now | +$48 | +$309 | +$640 | +$1,140 |
| $125 (+2%) | +$171 | +$439 | +$783 | +$1,385 |
| $129 (+5%) | +$343 | +$619 | +$976 | +$1,753 |
| $130 (+6%) ← target | +$402 | +$679 | +$1,039 | +$1,886 |
| $135 (+10%) | +$597 | +$878 | +$1,238 | +$1,886 |
| $141 (+15%) | +$812 | +$1,090 | +$1,435 | +$1,886 |
| $147 (+20%) | +$994 | +$1,260 | +$1,578 | +$1,886 |
Why This Strategy, Why Now
- RSI at 60 — extended, ideal for selling calls
- IV -17% vs avg — premiums below average, less income
- MACD bullish — stock has upward momentum
- ADX at 17 — range-bound, perfect for selling calls
- No squeeze — no imminent breakout
Key Risks
SHOP 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 SHOP approaches the strike before expiry.