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WMT Covered Call Strategy: Is Now a Good Time to Sell Calls? Moderate · 65/100
Walmart Inc. (Consumer Defensive) · $123.51 ·
Analysis generated Oct 30, 2026 ·
Data as of market close Oct 30
Quick Take
WMT is trading at $123.51 with RSI at 73 (overbought territory). Options IV is at 25% — 38% below its 30-day average of 41%. 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)
73
IV Today
25.0%
IV vs 30d Avg
-38%
MACD
bullish
ADX
42
MFI
62
The Setup
WMT Covered Call
LONG STOCK
100 shares @ $123.51
SHORT CALL
$135 Dec '26 · $1.78/sh
Net Cost
$12,173
Max Profit
+$1,327
Break-even
$121.73
Projected P&L at Target
+$1,327
(10.9%)
P&L at Expiry
P&L Scenarios
What happens at different WMT prices by expiry:
| WMT Price | Today | Nov 16 | Dec 2 | Dec 18 (exp) |
|---|---|---|---|---|
| $99 (-20%) | -$2,293 | -$2,292 | -$2,292 | -$2,292 |
| $105 (-15%) | -$1,679 | -$1,676 | -$1,675 | -$1,675 |
| $111 (-10%) | -$1,077 | -$1,062 | -$1,057 | -$1,057 |
| $117 (-5%) | -$505 | -$467 | -$443 | -$440 |
| $121 (-2%) | -$188 | -$129 | -$82 | -$69 |
| $124 (0%) ← now | +$9 | +$81 | +$150 | +$178 |
| $126 (+2%) | +$191 | +$278 | +$370 | +$425 |
| $130 (+5%) | +$434 | +$539 | +$664 | +$796 |
| $135 (+9%) ← target | +$716 | +$834 | +$984 | +$1,327 |
| $142 (+15%) | +$973 | +$1,082 | +$1,209 | +$1,327 |
| $148 (+20%) | +$1,106 | +$1,194 | +$1,278 | +$1,327 |
Why This Strategy, Why Now
- RSI at 73 — extended, ideal for selling calls
- IV -38% vs avg — premiums below average, less income
- MACD bullish — stock has upward momentum
- ADX at 42 — strong trend, stock may run past strike
- No squeeze — no imminent breakout
Key Risks
WMT 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 WMT approaches the strike before expiry.
ADX at 42 indicates a moderately strong trend. In trending markets, covered calls cap your upside too early. Use a higher strike to leave more room.