Options Strategist: GoPro is Targeting $35 Per Share

Nic Chahine was recently a guest on #PreMarket Prep, a daily trading idea radio show hosted by Joel Elconin and Dennis Dick. Tune in to the daily broadcast live Monday-Friday at 8 a.m. ET here.

On Benzinga's #PreMarket Prep, Create Income With Options Spreads Author Nic Chahine said that GoPro Inc GPRO, a stock that was nearly $65 a month ago, is now targeting $35 to $37.50 after having lost support in the $47 range.

That support was officially lost on Monday, resulting in the stock trading 6 percent lower on Tuesday. In illiquid after-market hours, the stock was indicated an additional 5.5 percent lower – trading last at $41.25.

With GoPro specifically, he said that he was not quite sure how much of the stock price was "earnings strength" versus a momentum story. That suggested that there may be some more room for GoPro to fall. Chahin, who reminded listeners that his whole portfolio is bearish, said his favorite strategy is to use non-fundamentally based pops to sell credit call spreads. He said that when doing this, he leaves "a lot of room" to the upside, meaning that he did not sell at-the-money spreads.

This year, GoPro has dipped 31 percent as of Tuesday's closing price of $43.69. The price fell early in the year to these levels before recovering and trading positive for the year in early August. In the rest of the month, the price fell precipitously.