Roblox shares have recently dropped in value. In July, they peaked at $150, but by December 19, 2025, the price had slipped to under $82.00. During its last earnings call, Roblox raised its outlook but warned of potential margin compression. This is due to several reasons, such as heavy spending on AI safety and infrastructure, higher payments to creators, and tough comparisons following a successful 2025. Roblox is making significant investments in AI safety tools and data centers to support its vast user base. Its Developer Economics strategy includes increased payouts to creators, which lowers the company’s earnings from sales. There are worries that growth might appear slower in 2026, especially after last year’s success driven by viral games. From a technical trading standpoint, this decline offers a chance. By finding key support levels, investors can purchase quality stocks at a discount. For Roblox, a key support point is at $75.50, which was significant back in February 2025. Technical analysis suggests a strong price rebound from this level. Since Roblox shares fell from $150 in July to below $82 recently, we are closely monitoring the important technical level of $75.50. This price reflects a significant high from February 2025. A stock that is dropping and nearing a strong support area can provide a clear chance for a rebound. Given this situation, we should think about buying out-of-the-money call options for January or February 2026. The recent price drop has likely increased implied volatility, but this also means a quick rebound could bring big returns, especially on options like the $85 or $90 calls. The goal is to be ready for a fast reaction off that $75.50 support in the coming weeks. A safer approach would be to sell cash-secured puts with a strike price at or slightly below the support level, like the January 2026 $75 puts. This strategy lets us earn premium while setting our entry at a level we find appealing. If the stock rebounds, we keep the premium. If it falls, we acquire shares at a strong technical level. Recent data from third-party sources supports the likelihood of a rebound, helping to offset worries about difficult comparisons for 2026. Reports from Sensor Tower indicate that Daily Active Users in the first three weeks of December were 18% higher year-over-year, surpassing analyst expectations for the holiday season. This strong user engagement suggests robust growth for the platform despite concerns about margin pressures. We have seen this pattern with Roblox before, especially during the sharp decline in 2023, when the stock found a bottom and surged after holding a key technical level. This past behavior gives us confidence that institutional buying may occur at these clearly defined support zones. However, we should also prepare for the chance that the support level might fail. If the stock closes below $75.00, it would invalidate the bullish outlook and signal further declines. In this case, we should be ready to quickly switch strategies by buying puts to take advantage of a continuing downturn, aiming initially for the $68 level.

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