Palo Alto Networks Inc (NASDAQ:PANW) stock is on track for a record close and fifth-straight win today. The equity sports a 37.6% year-to-date lead, with support stemming from its 20-day moving average and $380 level. The cybersecurity staple could soon topple its Nov. 14, all-time high of $408.53, thanks to a historically bullish signal now flashing.
The bullish signal in question is low implied volatility (IV), which in combination with PANW's recent peak makes for a strong technical setup. Schaeffer's Senior Quantitative Analyst Rocky White's latest study shows there were six times in the last five years when the equity was trading within 2% of its 52-week high, while its Schaeffer's Volatility Index (SVI) stood in the 20th percentile of its annual range or lower. This is now the case with the stock's SVI of 26%, which sits in the low 1st percentile of its 12-month range.
White's data shows just one month after these signals, the stock was higher 83% of the time, averaging a 5.4% pop for that period. From its current perch of $405.65, a comparable move would place PANW at a fresh record peak of $427.55.
Short-term options traders lean bearish. This is per the stock's Schaeffer's put/call open interest ratio (SOIR) of 1.40 that stands higher than 83% of readings from the past 12 months. This means an unwinding of this pessimism could keep tailwinds blowing for PANW.