GAP Reddit Mentions | ChartExchange

Ok so few things ( and i\`m attributing those to gaps in my own knowledge ):
1)When calculating IV on a price of an option - i assume u go about using BScholes Model ? ( this is covered extensively in the book in order of finding "mispriced options" on longer intervals - havent really tried it as of yet ). From my understanding however IV changes based on market conditions and more or less measures the speed of which a price change - so 2 different stocks on 100 would have different IV depending on previous movements - which would result in very differently priced options . IS there a specific way u go about calculating the IV in order to determine what fair value is ?
2) In practice - as i observe 4 - 6 stocks options price daily LLY pricing changes on minute intervals from 28$ to 25$ and back on open with limited move in price. Now personally i\`ve attributed that in change in IV - as i can see it go down quite a bit and then right back up - as the candles are trying to move in a direction. Based on my understanding Vega and IV are proportionally correlated - so a change in one would result in change in the other. Am i contributing the seesaw of price increase-decrease to the wrong attribute then ? In other instances where IV dipped below 30 on open i\`ve entered and exited ( 18$ to 22$ - i dont have exact numbers in hand but about that ) in a matter of seconds , in this case the price is not even moving enough to cause that as a change - only big number changing is IV. I exit right away - as based on my previous interactions this price will not hold if the stock does not do a move ( and in a lot of cases is just an IV gap that causes the price to move ). \*Ive played 2 week to expiration using this aswell - as further from expiration options are - higher price changers would occur when IV goes up. In those cases stock might not be doing a move ( or a very insignificant move ) and i\`ll try to catch an IV dump and exit on the increase.
3)Using tesla as example ( as difference in spread and price movements on a stock with more liquid options is more straight forward ) there are times where sharp increase/decrease of value in options prices occur (that i have corrolated with change in IV ) without such a sharp price "increase/decrase":
3.1 ) On Monday open Tesla ATM were 17.8$ ( this is for a straddle ) , It was a gap open - so usually those a bit of increase volatility on them , in the first 2 mins as the price retraced prices drop to 16.7 for ATM straddle ( i filled at 17) - matched low volume / resistance support - i entered a 445 straddle and exited at , 18.00 ( wayy to early 3 minutes later ) as it has reached 1st target of about 1% sharp increase. Now i attribute the initial depreciation on the fact the stock is moving "somewhat slower" than what the "GAP open" has priced - IV drops ( which it did ) - and options devalue . Am i wrong to see it this way ? (Screenshot below - reddit only allows 1 screenshot - so i added the price entry/exit instead of stock chart).
3.2) On Friday at 9.02 there was an IV dump across stocks - i had positions in Tesla and META that i was a little ahead - that turned into losses immediately ( META went from 6.7 to 5.2$ in a matter of seconds) - this was not a price move - volatility just shifted rapidly and never went back up. TBH i dont know how to "guard" against those properly . Only though on how to do so moving forward was to get an "average" daily IV (different time ranges where it applies ) and try to determine low - high ranges and include them in my exiting decisions . Another example for this would be christmass/holiday weeks - where stocks open with "normal" ( slightly below average IV) and then they dip... HARD. Tesla went to 36% IV that week i believe it open in Mid 40\`s (dont have the actual data ) - i got stuck in 1 of the sweeps and when i saw it dipping below 40IV exited.
I tried to list as many different scenarios that i contribute price changes on IV ( i might be missing some more ) . Please feel free to correct any/all where u think i\`m wrong - i truly appreciate the feedback. Additionally do you have any feedback on how to determine if a straddle price is "Correct"( overpriced/underpriced) ? Currently i evaluate it based on what move i think the price would occur and % of what the staddle\`s cost is - however in a lot of cases ( with further experiation) that is not an optimal way to do it - especially when there are significant price changes on open.
https://preview.redd.it/vtvnqktvzjcg1.png?width=499&format=png&auto=webp&s=4bac80aa91665b828cc807a60995f4e7f248e43c

.dark-mode .dGk3ql{ color: white; background-color: #333333; border: 2px solid white; }.light-mode .dGk3ql{ color: #333333; background-color: white; border: 2px solid #333333; }GAPThe Gap, Inc.stock NYSE

GAP
The Gap, Inc.
stock NYSE