$CVX Options Intelligence

🎯 SELL CVX NOV 21 160/165 CALL SPREAD

I recommend a bear call spread because the near-term IV for the Nov 21 expiration is elevated at 39.1% (Clean IV 39.1% vs baseline 18.0%), indicating options are overpriced and favoring premium selling. The stock price is $157.98, just below the 165 strike, and technicals show neutral RSI (57.81) with price slightly above 20-day and 50-day MAs, suggesting limited near-term upside. Additionally, Chevron goes ex-dividend on Nov 18, which typically exerts slight downward pressure post-dividend. The expected daily move is ±$3.23, making the 165 strike a reasonable short call level for limited risk premium collection.

Sell CVX Nov 21 160/165 Call Spread
Stock Price: $157.98 | Entry: Sell 160 Call Bid $1.10, Buy 165 Call Ask $0.45 = Net Credit $0.65 per share ($65 per spread)

📊 Trade Metrics

• Max Profit: $65 per spread (net credit received)
• Max Risk: $435 per spread (difference between strikes $5.00 - $0.65 credit)
• Breakeven: $160.65 at expiration
• Win Probability: Moderate to high (stock must stay below 160.65)
• Days to Expiration: 4 days (Nov 21)

📈 Term Structure & Volatility Analysis

• Baseline 90-day Vol: 18.0%
• 4-day Nov 21 Clean IV: 39.1% (overpriced, sell premium)
• 9-day Nov 28 Clean IV: 13.8% (underpriced, buy premium if calendar desired)
• IV Rank: 100% (very high, favors selling premium)
• Put/Call Volume Ratio: 0.12 (very bullish, heavy call buying) but short-term elevated IV justifies selling expensive calls
• Earnings on Jan 30, 2026 — Nov 21 expiry is before earnings, so trade is not for earnings play but for near-term premium decay

📈 Greeks & Volatility

• Delta short 160 Call: ~0.45 (moderate risk)
• Theta: Positive for seller, benefits from time decay over next 4 days
• Vega: Negative for seller, benefits if IV drops post-trade
• Current IV: Elevated at 39.1% vs historical 18% baseline

🎯 Why This Trade

The term structure shows a stark IV skew with near-term Nov 21 options nearly double the baseline volatility, signaling overpriced premium ideal for selling. Chevron’s technicals are neutral/bullish but with limited short-term upside given the proximity to the 160 strike and expected move (~$3.23). The ex-dividend date on Nov 18 may cap upside momentum. The short 160/165 call spread collects $0.65 credit with defined risk, benefiting from time decay and potential IV contraction. This is a tactical, low-risk premium sell ahead of the dividend and ahead of the next earnings cycle.

📊 Pro Analysis

• Current IV: 39.1% (high) vs Historical: 18%
• IV Rank: 100% (strong sell premium signal)
• Expected Daily Move: ±$3.23 (2.04%) supports strike selection
• Put/Call Volume Ratio: 0.12 (bullish bias but selling premium exploits overpriced calls)
• Technicals: RSI 57.81 (neutral), price above 20/50 MA, MACD bullish but near resistance
• Dividend: $1.71 ex-date Nov 18 (likely to pressure price short term)
• Related sector peers like XOM also show mixed signals, favoring cautious premium selling

🔍 Earnings Date Check

• Earnings: Jan 30, 2026
• Recommended expiry: Nov 21, 2025 (4 days) — well before earnings, so no earnings volatility risk

💡 Trade Management

• Entry: Place limit order to SELL Nov 21 160 Call at $1.10 and BUY Nov 21 165 Call at $0.45 for net credit $0.65
• Target: Close at $0.20 credit or better (profit ~69%)
• Stop: Exit if CVX rallies above $162 (breakeven plus cushion)
• Time stop: Close 1 day before expiration to avoid gamma risk

📅 Market Overview

Chevron is trading at $157.98, supported by bullish moving averages (20, 50, 200-day MAs) and a neutral RSI, indicating no immediate strong directional bias. The stock’s fundamentals remain solid with a 4.33% dividend yield and stable earnings. The energy sector shows mixed signals with some pressure from recent crude price declines. The upcoming ex-dividend date on Nov 18 may limit upside in the very short term. Elevated IV and extreme IV rank (100%) create a favorable environment for selling premium in near-term expirations. This trade aligns with a cautious neutral-to-bullish stance but exploits short-term overpriced call premium with defined risk.

🔒 Pricing Validation

• 160 Call intrinsic: max(0, 157.98-160) = 0 (OTM)
• 165 Call intrinsic: 0 (OTM)
• Spread intrinsic: 0
• Bid/Ask for 160 Call: approx $1.10 / $1.15
• Bid/Ask for 165 Call: approx $0.40 / $0.45
• Net credit $0.65 is above intrinsic value and respects put-call parity

Confidence Level: Moderate-High. The trade benefits from clear IV skew and term structure, defined risk, and technical setup. The main risk is a sharp rally above 165 in the next 4 days, which is less likely given the ex-dividend pressure and expected move.

Risk Assessment: Limited max loss of $435 per spread; risk defined and manageable with tight stop. Time decay and IV contraction favor the seller in the short term. Avoid holding into earnings to mitigate volatility spikes.

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If you want a calendar play, consider buying the Nov 28 160 call (IV 13.8%, underpriced) and selling the Nov 21 160 call (IV 39.1%), but that is more complex and requires margin.

This recommended bear call spread is the best straightforward, low-risk premium-selling trade for CVX today given current market conditions.