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IBM Covered Call Analysis: Proceed With Caution Weak · 55/100
IBM · $230.76 ·
Analysis generated Apr 13, 2026 ·
Data as of market close Apr 13
Quick Take
IBM is trading at $230.76 with RSI at 36 (oversold territory). Options IV is at 0% — 100% below its 30-day average of 57%. Neither RSI nor IV strongly favor selling calls right now. Consider waiting for better conditions or using a different strategy.
Technical Signals
RSI (14)
36
IV Today
0%
IV vs 30d Avg
-100%
MACD
bullish
ADX
19
MFI
59
The Setup
IBM Covered Call
LONG STOCK
100 shares @ $230.76
SHORT CALL
$250 Jun '26 · $7.65/sh
Net Cost
$22,311
Max Profit
+$2,689
Break-even
$223.11
Projected P&L at Target
+$2,689
(12.1%)
P&L at Expiry
P&L Scenarios
What happens at different IBM prices by expiry:
| IBM Price | Today | May 5 | May 27 | Jun 19 (exp) |
|---|---|---|---|---|
| $185 (-20%) | -$3,850 | -$3,850 | -$3,850 | -$3,850 |
| $196 (-15%) | -$2,696 | -$2,696 | -$2,696 | -$2,696 |
| $208 (-10%) | -$1,543 | -$1,543 | -$1,543 | -$1,543 |
| $219 (-5%) | -$390 | -$389 | -$389 | -$389 |
| $226 (-2%) | +$295 | +$302 | +$303 | +$303 |
| $231 (0%) ← now | +$739 | +$758 | +$765 | +$765 |
| $235 (+2%) | +$1,160 | +$1,199 | +$1,224 | +$1,227 |
| $242 (+5%) | +$1,704 | +$1,788 | +$1,872 | +$1,919 |
| $250 (+8%) ← target | +$2,130 | +$2,248 | +$2,389 | +$2,689 |
| $254 (+10%) | +$2,266 | +$2,384 | +$2,520 | +$2,689 |
| $265 (+15%) | +$2,450 | +$2,536 | +$2,616 | +$2,689 |
| $277 (+20%) | +$2,481 | +$2,550 | +$2,618 | +$2,689 |
Why This Strategy, Why Now
- RSI at 36 — oversold, not ideal for selling calls
- IV -100% vs avg — premiums below average, less income
- MACD bullish — stock has upward momentum
- ADX at 19 — range-bound, perfect for selling calls
- No squeeze — no imminent breakout
Key Risks
IBM 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 IBM approaches the strike before expiry.