These 2 Stocks’ Unusual Options Activity Flashes Strangle Plays

Group 1: Federal Reserve Interest Rate Cut - The Federal Reserve announced a quarter-point interest rate cut, while the White House anticipated a half-point cut [1] - Markets reacted positively, with S&P 500 futures reaching a record high in premarket trading [1] Group 2: Options Activity - There were 862 calls and 433 puts in unusual options activity, resulting in a put/call volume ratio of 0.50, indicating a bullish sentiment [2] - Among 1,295 unusually active options, 11 stocks with October 17 expiration had both calls and puts, suggesting potential long and short strangle strategies [2] Group 3: Lyft (LYFT) Stock Performance - Lyft's stock has increased by 21% in the past five days and 73% year-to-date, reaching its highest level since April 2022 [6] - The stock's recent surge is attributed to the announcement of launching autonomous ride-hailing services with Waymo in Nashville by 2026 [6] Group 4: Options Strategy for Lyft - A long strangle strategy involves buying a call and a put option, anticipating increased volatility [4] - The $25 call option for Lyft has a high Vol/OI ratio of 25.90, making it a candidate for a long strangle [3][5] Group 5: Market Sentiment and Caution - Lyft has exceeded Wall Street's 12-month price target of $16.88, suggesting that investors should be cautious at current price levels [7]