Editor’s Note (Profit-Taking Alert): CVX opened around $186 this morning (Feb. 27), and our March 20 $170 call “lottery ticket” has exploded in value. This update is a simple one: we’re taking the win and closing the trade now. Lottery tickets are meant to be cashed when they hit.
Back in early January, we were staring at a geopolitical headline grenade out of Venezuela — the kind of situation that usually sends traders running to “Buy oil!” and asking questions later.
But instead of trying to guess whether crude would spike or collapse, we focused on something the market was actually rewarding in real-time: Chevron (CVX).
In the original write-up, the core thesis was straightforward: if Venezuela chaos turned into an “energy story,” the business (CVX) could outperform the crude proxy (USO). We wanted the potential windfall, but we also wanted a trade with a clear, predefined risk: the premium we paid.
If you want to re-read the original article, here it is:
Venezuela Chaos Trade: A $1,000 Options Bet With Windfall Potential (Or a Total Loss)
The Original Trade (The “$1,000-Style” Lottery Ticket)
| Item | Details (Example Position) |
|---|---|
| Underlying | Chevron (CVX) |
| Strategy | Long call (defined-risk, swing-for-the-fences) |
| Contract | CVX March 20, 2026 $170 Call |
| Example Entry | $2.90 per contract (=$290 each) |
| Example Size | 3 contracts |
| Max Loss | $870 (100% of premium) |
This was never presented as a “safe” trade. It was a small, intentional “lottery ticket” position — the kind of bet that can absolutely go to zero… but can also turn into a windfall when the tape breaks your way.
The Scenarios We Originally Mapped Out
Below is the cleanest way to understand why this trade was so powerful (and so risky): intrinsic value at expiration. If CVX finishes below $170 on March 20, these calls expire worthless.
| CVX at Expiration | Call Intrinsic Value | Value (3 Contracts) | Profit / Loss | Return on Premium |
|---|---|---|---|---|
| $160 | $0 | $0 | -$870 | -100% |
| $170 | $0 | $0 | -$870 | -100% |
| $172.90 (Breakeven) | $2.90 | $870 | $0 | 0% |
| $175 | $5.00 | $1,500 | +$630 | +72% |
| $180 | $10.00 | $3,000 | +$2,130 | +245% |
| $185 | $15.00 | $4,500 | +$3,630 | +417% |
| $190 | $20.00 | $6,000 | +$5,130 | +590% |
| $200 | $30.00 | $9,000 | +$8,130 | +934% |
This table is the whole story: options can be dangerous (total loss is real), but when they work, the payoff ramps fast.
What CVX Actually Did
Here’s the punchline: CVX is now trading in the mid-$180s — and our once-out-of-the-money calls are now deep in the money.
Why We’re Taking Profits Now
This was a lottery ticket. It hit. And that’s exactly why we’re closing it.
With only a few weeks left until March 20 expiration, the risk/reward starts to change. A sharp pullback can take a big bite out of profits quickly, and the easiest way to turn a great win into a frustrating round-trip is to get greedy.
So we’re doing the disciplined thing: taking the windfall and moving on.
Profit Snapshot If We Close the Trade Now
The table below uses a conservative approach: assume you sell near the current bid (not the midpoint), because that’s the “instant liquidity” price.
| Metric | Per Contract | 3-Contract Example |
|---|---|---|
| Entry Cost | $290 | $870 |
| Estimated Exit (Sell-to-Close) | $15.75 ($1,575) | $4,725 |
| Dollar Profit | +$1,285 | +$3,855 |
| Percent Gain | +443% | +443% |
| Time in Trade | 53 days | 53 days |
This is what we mean when we say these trades won’t always work — but when they do, they can create a windfall.
A 15% move in the stock created a multiple-hundreds-percent gain in the option, because options are pure leverage.
What To Do Right Now
Action to Take: Sell to Close the the Chevron (CVX) March 20, 2026 $170 calls and take profits.
If you’re placing a limit order, check your broker’s bid/ask and work your order. In fast markets, spreads can be wide. Don’t panic-sell with a market order unless you’re comfortable with slippage.
Good trading,
Greg Patrick
P.S. A quick behind-the-scenes note: I originally built this idea in TrendSpider — it made it easy to spot the CVX-vs.-oil divergence, review unusual options activity (where the “smart money” action was leaning into CVX positioning instead of chasing crude), and pressure-test the trade against prior geopolitical windows (where CVX’s crisis behavior gave us a stock-specific playbook). If you like having charts, scans, and alerts under one roof, it’s worth a look.