Let’s take a look at the key simple moving averages in order to dissect Travelers’s price trend. The key moving averages are the 50-day, 100-day, and 200-day simple moving averages. Travelers stock is trading above these rising key averages that are consecutively stacked. What does this mean? The stock is displaying a wonderfully strong uptrend.
One to gain perspective into investor sentiment is through the use of the options market. More specifically, taking a look at the implied volatility and implied volatility skew levels of Travelers options may help determine if investors are bullish, neutral, or bearish. The implied volatility of Travelers options is at 15.96 percent today which coincides with a 50th percentile over the last 30 trading days and 40th percentile over the last 90 trading days. What does this mean? This means that investors or traders are buying a good amount of call and put options contracts, as compared to the last 30 and 90 trading days.
The implied volatility skew of April and May put options is steep while call option skew is average. As of today, there is an average demand from call buyers or call sellers and high demand by put buyers or low demand by put sellers, all neutral to bearish over the next two months. Investors are buying a good amount of call and put option contracts and are leaning neutral to bearish over the next two months, potentially hedging the monster gains they have already made.