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Why MPWR Is an Excellent Covered Call Candidate Right Now Strong · 85/100
MPWR · $1353.85 ·
Analysis generated Apr 10, 2026 ·
Data as of market close Apr 10
· Market closed — data may be from last trading day
Quick Take
MPWR is trading at $1353.85 with RSI at 73 (overbought territory). Options IV is at 55% — 34% below its 30-day average of 82%. While the stock is extended, IV is below average which means premiums aren't as rich. The trade still works but yields less income than usual.
Technical Signals
RSI (14)
73
IV Today
54.6%
IV vs 30d Avg
-34%
MACD
bullish
ADX
24
MFI
75
The Setup
MPWR Covered Call
LONG STOCK
100 shares @ $1353.85
SHORT CALL
$1460 Jun '26 · $89.0/sh
Net Cost
$126,485
Max Profit
+$19,515
Break-even
$1264.85
Projected P&L at Target
+$19,515
(15.4%)
P&L at Expiry
P&L Scenarios
What happens at different MPWR prices by expiry:
| MPWR Price | Today | May 5 | May 27 | Jun 19 (exp) |
|---|---|---|---|---|
| $1083 (-20%) | -$19,610 | -$18,797 | -$18,263 | -$18,177 |
| $1151 (-15%) | -$13,904 | -$12,698 | -$11,699 | -$11,408 |
| $1218 (-10%) | -$8,664 | -$7,040 | -$5,431 | -$4,639 |
| $1286 (-5%) | -$3,953 | -$1,939 | +$329 | +$2,131 |
| $1327 (-2%) | -$1,397 | +$815 | +$3,447 | +$6,192 |
| $1354 (0%) ← now | +$192 | +$2,517 | +$5,360 | +$8,900 |
| $1381 (+2%) | +$1,689 | +$4,109 | +$7,130 | +$11,608 |
| $1422 (+5%) | +$3,763 | +$6,291 | +$9,506 | +$15,669 |
| $1460 (+8%) ← target | +$5,542 | +$8,132 | +$11,444 | +$19,515 |
| $1489 (+10%) | +$6,779 | +$9,389 | +$12,718 | +$19,515 |
| $1557 (+15%) | +$9,279 | +$11,857 | +$15,053 | +$19,515 |
| $1625 (+20%) | +$11,316 | +$13,768 | +$16,651 | +$19,515 |
Why This Strategy, Why Now
- RSI at 73 — extended, ideal for selling calls
- IV -34% vs avg — premiums below average, less income
- MACD bullish — stock has upward momentum
- ADX at 24 — moderate trend
- No squeeze — no imminent breakout
- MFI at 75 — money flow confirms overbought
Key Risks
MPWR 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 MPWR approaches the strike before expiry.