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STX Covered Call Strategy: Is Now a Good Time to Sell Calls? Moderate · 70/100
Seagate Technology PLC (Technology) · $1065.01 ·
Analysis generated Jun 18, 2026 ·
Data as of market close Jun 18
Quick Take
STX is trading at $1065.01 with RSI at 75 (overbought territory). Options IV is at 84% — 32% below its 30-day average of 125%. While the stock is extended, IV is below average which means premiums aren't as rich. The trade still works but yields less income than usual.
Technical Signals
RSI (14)
75
IV Today
84.5%
IV vs 30d Avg
-32%
MACD
bullish
ADX
41
MFI
76
The Setup
STX Covered Call
LONG STOCK
100 shares @ $1065.01
SHORT CALL
$1150 Aug '26 · $147.7/sh
Net Cost
$91,731
Max Profit
+$23,269
Break-even
$917.31
Projected P&L at Target
+$23,269
(25.4%)
P&L at Expiry
P&L Scenarios
What happens at different STX prices by expiry:
| STX Price | Today | Jul 9 | Jul 30 | Aug 21 (exp) |
|---|---|---|---|---|
| $852 (-20%) | -$11,042 | -$9,206 | -$7,394 | -$6,530 |
| $905 (-15%) | -$7,335 | -$5,154 | -$2,785 | -$1,205 |
| $959 (-10%) | -$3,932 | -$1,440 | +$1,469 | +$4,120 |
| $1012 (-5%) | -$832 | +$1,922 | +$5,307 | +$9,445 |
| $1044 (-2%) | +$885 | +$3,770 | +$7,391 | +$12,640 |
| $1065 (0%) ← now | +$1,971 | +$4,931 | +$8,687 | +$14,770 |
| $1086 (+2%) | +$3,012 | +$6,037 | +$9,907 | +$16,900 |
| $1118 (+5%) | +$4,490 | +$7,594 | +$11,597 | +$20,095 |
| $1150 (+8%) ← target | +$5,862 | +$9,024 | +$13,110 | +$23,269 |
| $1172 (+10%) | +$6,740 | +$9,928 | +$14,045 | +$23,269 |
| $1225 (+15%) | +$8,739 | +$11,955 | +$16,063 | +$23,269 |
| $1278 (+20%) | +$10,509 | +$13,701 | +$17,693 | +$23,269 |
Why This Strategy, Why Now
- RSI at 75 — extended, ideal for selling calls
- IV -32% vs avg — premiums below average, less income
- MACD bullish — stock has upward momentum
- ADX at 41 — strong trend, stock may run past strike
- No squeeze — no imminent breakout
- MFI at 76 — money flow confirms overbought
Key Risks
STX 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 STX approaches the strike before expiry.
ADX at 41 indicates a moderately strong trend. In trending markets, covered calls cap your upside too early. Use a higher strike to leave more room.