Markets opened the week as a mixed bag and then settled firmly into the red. The catalyst was less corporate than geopolitical: overnight caution gave way to a brief recovery on Middle East headlines, only for sentiment to sour again when Iran's response proved to be not what investors had hoped to hear. Notably, the VIX barely moved — up only a tick or two — which suggests the selling reflected headline-driven hesitation rather than genuine panic. With earnings season at its tail end and only a handful of large retailers left to report, the market's near-term direction is hinging almost entirely on what comes out of the Middle East. Against that backdrop, three names stand out as worthwhile setups, each illustrating a different way to express a view through options.
Circle: A Golden Cross in a Tightening Range
The first idea is Circle, which was down more than 4% on the day — slightly worse than the broader market. The appeal here is partly technical and partly structural. Circle recently printed a golden cross, the bullish signal that occurs when the 50-day moving average crosses above the 200-day moving average. Since its IPO, the stock has had a volatile history of sharp ups and downs, but the golden cross is a constructive sign worth respecting.
The trade is deliberately simple: a call spread expiring about a month out, buying the 115/125 vertical for roughly $3 (and slightly less as the day's weakness set in). The upside is attractive, but the position carries an obvious risk — Circle is closely tethered to crypto. With Bitcoin unable to reclaim the 80,000 level and trading nearer 76,000, that linkage matters. Even so, Circle has dramatically outperformed the asset class it tracks. Over roughly the past six months, near the time of crypto's all-time highs, Circle is up more than 40%, while the broader crypto complex is down anywhere from 15% to 50% depending on what you measure. That relative strength despite a falling tide is precisely what makes the name interesting.
The chart tells a story of compression. Circle has formed a symmetrical triangle, with one line sloping down across the highs and another sloping up across the lows, the latter beginning at the 52-week low near 4990. The 124–125 zone is a meaningful ceiling: it was a repeated low point during an earlier range and the area where the stock topped out again recently. Intraday highs poked above it, but lasting progress past that boundary has consistently failed. To the downside, 98 and 89 form a supportive zone — anchored by a gap level and repeated highs — that has been tested several times. Momentum, read through the RSI, has tilted more bearish, though the indicator itself is bouncing within a narrowing range that mirrors price. This is the classic precursor to higher volatility: low-volatility coils tend to resolve in explosive breakouts once a well-defined boundary finally breaks. For an upside bias, the 140 level stands out, since that is where heavy trading activity begins to thin out before picking up again between 180 and 210. To the downside, 8450 is the point of control — the single heaviest trading area — and it lines up neatly with the supportive zone identified earlier.
TJX: A Defensive Retailer Into Earnings
The second name, TJX, is an explicit earnings play, with results due Wednesday. The thesis rests on the resilience of lower-end and budget retailers in what looks increasingly like a K-shaped economy, where consumers split between trading down and spending freely. TJX sits in the same favored cohort as Costco, Walmart, and Target — names that are firmly in vogue. What makes the setup compelling is that TJX trades right down to its 200-day moving average heading into the print, an attractive technical foothold ahead of a binary event.
The chosen structure is a diagonal call spread: selling this week's 155-strike call and buying next week's 150-strike call — two different expirations forming a 150/155 vertical — for a debit of roughly $2. The structure lets the near-dated short option finance part of the longer-dated long option while keeping defined risk into the news.
Technically, 150 is the key level: a notable prior low and roughly where price sits now, making it a plausible breakout pivot. The broader shape is a downward-sloping channel, with the upper line connecting subsequent highs from 16582 and a parallel line fitting cleanly across the lows. Resistance is otherwise sparse: 153 marks another minor low, and 158–160 is a more defined resistance zone built from repeated stalls and consolidation. To the downside, 146 is a notable low and the area of a recent bottom. The moving-average picture is improving — the one-year, 251-day exponential moving average proved supportive recently, price is now bouncing above the 5-day weekly EMA near 149, and the next test is the 21-day monthly EMA at 153, which would also coincide with a breakout from the channel. The RSI showed bullish divergence, rising even as price made a lower close, and has climbed out of oversold territory; bulls would want it to push above the 50 midline. The volume profile places price in a relatively thin node between 147 and 151, with the point of control — the most pronounced area of heavy trading — sitting at 156. That is the level the bulls would need to recapture and clear.
Palo Alto Networks: Selling Premium After a Vertical Run
The final pick, Palo Alto Networks, inverts the logic of the other two. This is a stock to admire but to be wary of chasing — it has run too far, too fast. Its earnings fall on June 2nd, a few weeks out, so this position is deliberately not an earnings play; it expires before the report. The chosen structure is a slightly bearish iron condor, a bet on consolidation: selling next week's 220/225 put spread on the downside and next week's 250/255 call spread on the upside, collecting roughly $2.50 in premium. The bearish tilt comes from the call spread being closer to where the stock currently trades, expressing the view that the recent surge needs to cool before earnings.
The technical case underscores the caution. The stock just put in roughly eight days of strong gains, with intraday highs topping out at 24798. The 220–225 region stands out as the first meaningful potential support, since that aligns with old prior highs — though the sheer speed and ferocity of the advance has left few footholds along the way. The next reference below that is a gap level near 191, far enough away that it likely will not factor into most calculations. The 5-day EMA at 234 has mirrored the rapid ascent; a break below it would coincide with the lower channel boundary, creating a confluence of indicators — and when multiple technical signals line up at the same level, the eventual breakout can be sharper because more participants are watching the same spot. Most striking is the RSI reading of 86.5. On a scale that runs only from 0 to 100, anything above 80 is extreme, and 86.5 is uncommonly high — a sign of powerful but potentially overextended momentum. A more granular three-month view of volume shows a small pocket of activity at 230–240, another node at the prior 210–215 peak, and a deeper one at 193–200, marking the realistic support shelves beneath this stretched move. With the stock trading near 24508, up almost a percent on the day, the iron condor is a way to harvest premium from a name whose chart is sending an unmistakable "too far, too fast" signal.
The Common Thread
Taken together, these three setups show how a single market backdrop can be expressed through very different structures. Circle uses a straightforward call spread to lean into a technical breakout with defined risk. TJX uses a diagonal spread to position constructively into a known catalyst. Palo Alto Networks uses an iron condor to sell volatility into an overextended rally while deliberately sidestepping its earnings date. In a tape governed less by fundamentals than by geopolitical headlines, the lesson is that the instrument matters as much as the thesis: the right options structure lets a trader define exactly which outcome — breakout, drift, or exhaustion — they are actually being paid to predict.