Stocks fell again on Thursday, with the S&P finishing the session down .77% and lower for the 3rd session in a row. Asia market tumbled overnight while Europe indexes are also in the red this morning. U.S. futures are pointing to a lower open, the Dollar, Yields, and Oil are in the red while Gold is in the green.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-305/
Stocks fell again on Thursday, in a session that reminds me of an ice cube melting in the sun or a tire deflating over the course of a few days because of a pinhole leak. If there is an silver lining to the last few sessions, it is that the market sell-off seemed somewhat orderly. No wild swings or gaps. I think one more down day or a flush and should be some playable bounces next week. There is no major catalysts this morning outside of DE earnings, which came in better than expected. Overnight, reports came out that Evergrande is filing for bankruptcy. Have to see how this weekend plays out with China headlines likely set to dominate. Hopefully no crazy surprises or black swans and maybe markets can find some footing ahead of Powell's speech at Jackson Hole next Friday. The SPY closed solidly under the 50dma yesterday but also under the lower Bollinger band for the second session in a row. Have to think some type of bounce comes either today or Monday:
With markets falling and the SPY under $440, I finally added a hedge for downside. It has been a while since I have added a position to play for a sell-off. I was eyeing TZA or FAZ calls and went with FAZ with the specter of more bank downgrades coming. Will likely close some out at the open to cover costs and then just ride the rest as protection. FAZ did rally to $25 during the Silicon Valley Bank fiasco... don't think it goes there, but do think can trade north of $20 if this market continues to melt:
I also added some GLD puts. Gold has fallen in 12 of the past 13 sessions. Most of the moves have been less than .50%. Think at some point there will be a 3%+ move to the downside. Of course, take with a grain of salt, as I am not a Gold bug. But I do think if this $1910 area breaks that new multi-month lows come... likely to $1850 or so first. May look to add some GLL calls as well today:
WW rallied over 5% yesterday, closing right at $10. Hopefully continues the rally today and starts the move to $12+ in the coming week or two. :
ANET rallied at the open, testing $184.83 before selling off with the rest of the market to close at $182.76. Will need a big move today for the rest of my calls. Will likely wait until next week to add anything:
A rough session for ULTA, closing off over 2% despite a great report from WMT, great retail sales numbers this week, and TGT numbers that came in mostly inline. Still watching to add a possible position for calls next week but will wait for premiums to come down. $500 calls, which are $64 out of the money with 5 days till expiry, are $2 x $2.35. Not the type of risk/reward I like unless I was confident the stock would rally into the report so I could close some out to cover costs:
Great headlines this morning out of market watch. Once would assume an unusual amount of options expire today:
Instead, it is a normal expiration day. Likely will keep things small. May look to play some early lotto puts on names like NOW, AVGO, and LRCX. And then possibly play some bounces into the afternoon. Also, may look to add a few TZA calls to go with my FAZ calls.
Also, will look to be on audio in the chatroom before noon.
And this is what I am watching today: TZA, LRCX, NOW, AVGO, ULTA, WW, VKTX, ROKU, ALGN, CMG, QQQ, SPOT, TEAM, ISRG, BLK, IBM, and NFLX.
Let's have a great day!
-JB