Markets tumbled on Wednesday, after a hotter than expected CPI number. The S&P fell .95% while the Nasdaq closed down .84%. Asia markets closed mostly lower overnight while Europe indexes are in the red this morning. U.S. futures are pointing to a higher open, the Dollar, Yields, and Oil are lower while Gold is higher.
And here is my rant from yesterday if you missed it: https://www.optionmillionaires.com/jb-afternoon-rant-april-10th-2024/
And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-435/
It was a nasty session on Wednesday after the CPI came in hotter than expected, although it was a good sign the SPY closed above $512.50. This morning the PPI data came in cooler than expected. The PPI is the producer inflation, so this read could somewhat offset the CPI as one would expect the CPI to follow suit next month or the month after. Either way, futures rallied after the data. Odds for a June and July rate cut tumbled and odds of a cut in Sept are at 44%. Hopefully the market can hold their gains this morning and the SPY can work its way back to that $518.50 handle into the weekend. Q1 earnings kick off tomorrow morning with the banks. Could provide another catalyst for markets so will be something to watch. And of course, still have my eye on the triple-headed monster. Yields, Oil, and the Dollar all rallied yesterday. If this trend continues, a pull to $204.50 on the SPY is inevitable:
TLT:
SE ramped higher after the open yesterday, despite the market weakness, breaking over $58. I used the move to lock some of my calls in for 100%. It then preceded to give back all of its gains, which it seems to do everyday now, before finding some buyers to close slightly in the green. Think only a matter of time before it crosses into the $60s but would not be surprised to see a breather soon before the next leg:
I added some later dated calls on ACB yesterday. Already locked some nice profits on the $7 calls( 100%, 500%, 1,100%) and wanted to have some exposure past April expiry. Think it trades north of $10 soon and likely higher but will remain bumpy:
Same goes for CGC. CGC was actually on the Reg Sho List yesterday:
https://x.com/OMillionaires/status/1778068166431633507
That means someone is shorting the stock without possibly having the stock to sell(didn't borrow)... ie. naked shorting. Maybe nothing but could be something and add to the upside. Still think $17-18 coming:
DELL closed slightly in the red yesterday after treading water in the green for most the day. Chart still looks nice here despite its 7% drop this week. If/when the market finds footing, should be $130+ soon. Higher highs and higher lows always a good sign:
STZ reported a strong beat this morning and offered up some nice guidance. The stock is gapping higher this morning but not as much as I would like to see. Think $275+ comes today if not higher. If it breaks $275 may look for some later dated strikes for a move to $290+ in the coming week or two:
Another boring session for ISRG. Boring and option premiums are like oil and vinegar, they do not mix well together. Will need a big rally today for my calls to have any shot. Chart is tight - one of these days it will break into the $400s and beyond. Not sure I will add anything more today but will be watching:
It was tough to add any hedges yesterday. Most of the names I would have added, like AVGO or MDB, reversed the morning gap before treading water the rest of the day... meaning any puts added at the open would be in the red. Still watching those names as possible hedges if the SPY trades under $512.50.
And here is what I am watching today: AVGO, MDB, ISRG, STZ, AVAV, ACB, CGC, DELL, NOW, TZA, IIPR. CDLX, ISRG ,SPOT, EW, VKTX, TERN, SNOW, NOW, LRCX, GPCR, NFLX, PYPL, RDDT, IWM, and ADBE.
Let's have a great day!
-JB