Lets look at MOMO

Today I once again came across Momo. Several weeks ago there was talk of the CEO and other officers buying out the company and taking it private. People were up on the news for a bit then the price wandered back down. Now the CEO issued a non binding letter, and once again the stock has jumped as it is back in the news:

NEW YORK (TheStreet) -- Shares of Momo (MOMO) are gaining 12.2% to $17.61 on heavy trading volume Tuesday after the Chinese Internet company received a "going private" offer.

Momo said it received a non-binding proposal letter from co-founder, Chairman and CEO Yan Tang, and investment firms Matrix Partners China II Hong Kong, Sequoia Capital China, and Huatai Ruilian Fund Management. Yang and the group offered to buy all shares they don't already own for $18.90 an American Depositary Share to take the company private.

The company formed a special committee of two independent, disinterested directors to consider the offer. The committee plans to retain legal and financial advisors to help evaluation the possible transaction.

It seems that this is a rather long process and there is a lot of steps/time/this isnt happening tomorrow. I believe that as more time passes, the stock is going to wander back down. But is there any more topside?

A bit. . The CEOs offer is to buy just under 19 dollars. When a company is bought out you will see it flatline for the say at the buyout price. Also lets look at the candles and what happened during last time's jump: It climbed up to where it was supposed to be and sat there and then wandered down. It would stand to reason that this is going to happen this time as well. When a lot of the end of day traders go home and look at this, I think it will make it go up tommorrow another half point to a point. Then at the top of the range say 19 I would do a put that is more out there, say Sept. to give us time and protect against erosion. That would be say in 2-3 days from now or so.
So lets get to it. We are going to do a HALF PRICED call. As in, half of what I would usually use when I purchase an option. This reflects my feelings on the strength/weakness of this play after all things are taken into consideration. This is my more conservative play for the day. My next post, GDOT, I am going to roll the bones and gamble. Below is my in for the half call:

The call I used here is actually quite brilliant in the fact that its so undervalued due to the fact of the price action today, being right outside the money with the stock just starting to wander down I can get this for cheap. If the stock does wander up closer to the price of the buy out this is gonna inflate fast.

Stay tuned for my next post. Its going to be a straddle on GDOT.