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Today, we’re opening a new bullish trade on Adobe Systems, Inc. (NASDAQ:ADBE). ADBE released its quarterly earnings last week and beat revenue estimates by $40 million and earnings estimates by $0.04 per share — coming in at $2.29 billion and $1.73 per share, respectively.
The company’s Digital Media, Digital Experience and Publishing business groups all outperformed expectations, and this bullish news sent the stock up to a new 52-week high on Friday, giving us an excellent opportunity to take advantage of the renewed bullishness with a new put-write. 
Looking at the chart of ADBE, you can see the stock has not only broken out to a new high but also broken above the up-trending resistance level that marked the top of the up-trending channel the stock has been in since the company’s last earnings announcement in June.
The stock had set up for this bullish breakout by forming a low in early September that failed to drop all the way back down to the up-trending support level at the bottom of the channel, and today’s price action confirms the breakout.
Looking forward into October, we know that former up-trending resistance levels typically turn into new up-trending support levels. By the time we reach the October expiration of this trade, the up-trending level will be above our strike price of $275, increasing the odds that ADBE will be trading above our strike price.
However, if it does end up trading below our strike price by expiration, we wouldn’t mind having the stock put to us. It has been a perennial winner, and we expect it to remain as such during 2018.
‘Sell to open’ the ADBE October 19th $275 Put Write (ADBE181019P00275000) for a minimum price of $7.10.
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