Stocks closed lower last week, with the S&P dropping 3.05% - it's worst weekly performance since March of 2023. Asia markets closed higher overnight while Europe indexes are also in the green this morning. U.S. futures are pointing to a bounce, the Dollar and Yields are higher while Oil and Gold are lower.
And here is my rant from Friday if you missed: https://www.optionmillionaires.com/jb-afternoon-rant-april-19th-2024/
It was a rough week for markets, with the S&P tumbling over 3% while the Nasdaq fell over 5.5%. It was the worst week for the S&P since March of last year and the worst for the Nasdaq since November of 2022. This week is a big one, with over 30% of the S&P set to report earrings including the likes of MSFT, META, GOOGL, and TSLA. We also get PCE data on Friday. And lastly, will be an important one to see how the market reacts after the recent weakness.
I would be surprised if markets don't bounce a bit after last week... even if just today and tomorrow. I thought the reversal from the overnight lows Thursday nights into Friday would be it, instead markets fought any bounce attempt Friday. Today it gets another shot. If the SPY can hold $497-498 think the $500s can come today and tomorrow with that $504.50 handle coming back in play. If it reverses the opening gains, just like it was doing to start last week, I fear more downside will come and that $487 level comes next:
Would want to see that VIX back under 17.50:
Shorter view:
And lastly, despite Friday's sell-off, more names climbed back over their 50dma, a possible good sign if that trend continues today:
Like I keep saying, I don't have my bear suit on per se, but am open to more downside and will continue to use put hedges.
It is a big week for earnings, here are some of the implied moves:
Here are two possible names I may dabble in this week:
URI is one. Kicking myself for missing its last earnings rally. One of the reasons I like STRL as one of my top 5 stock for 2024 is the tailwinds from the $1.2 trillion infrastructure bill passed nearly 2 years ago. Seems it is starting to bear fruit in name like STRL, URI, and even GWW. I may look to add some spec calls in URI and GWW this week for beats and raises. Both stocks have nearly given back all their gains from last earnings and think they offer a nice risk/reward if the market finds any footing this week:
URI reports Thursday morning:
https://x.com/OMillionaires/status/1782065809151394133
and GWW reports Thursday morning as well
What a crazy day on Friday. My put hedges came back to life on AVGO and I was able to flip some LRCX puts. AVGO was down over 10% last week. If things reverse today, AVGO could certainly be looking at a test of $1100 so. Don't be surprised if you see me re-enter some hedge puts:
And of course MDB. Keep talking about this one breaking under $320 and then testing the $200s. Have my eyes on adding some hedge puts again here:
And lastly, still holding my CRWD puts. Will be looking to take some off to cover costs today and ride the rest. CRWD was down 8% last week and can see it test the $270s in the next day or two. If it does find a bid, will look to lock all my position in on a break of $290:
Still love DELL here. As I keep saying, will hold my calls while using hedge positions to offset losses while also looking for opportunities to add more strikes. Will be looking for June and beyond calls if it breaks under $110:
I added some June VKTX calls on Friday. They will report earnings after the close Wednesday. The earnings will be more about updates on their studies along with their cash position and comments on the conference call. They have NASH data coming out before the end to the Q as well. And of course, the possibility of M&A. Chart looks tight and think a move into the $70s and beyond this week:
And still have my eyes on CDLX, AVAV, and SE for calls:
CDLX:
And SE, which got another upgrade this morning:
And certainly not going to be overly aggressive either direction today.
Here is what I am watching today: DELL, AVAV, CDLX, GWW, URI, MDB, AVGO, SE, CAVA, IIPR, NOW, TZA, ,SPOT, EW, TERN, SNOW, LRCX, GPCR, PYPL, RDDT, IWM, and ADBE.
Let's have a great day!
-JB