Markets closed mixed yesterday, with the S&P closing down .37% while the Dow finished up .20%. Asia markets tumbled overnight while Europe indexes are in the red this morning. U.S. futures are pointing to a lower open, the Dollar and Yields are lower while Oil and Gold are higher.
It was a premium chop session on Tuesday, with stocks trying to rally after the open, only to come under pressure and give back the gains. After the close, Fitch downgraded the US credit rating from triple A to double A+. The second downgrade of the US in 12 years. The last time it happened was Aug 5th of 2011. I remember it like it was yesterday. Markets were still somewhat on edge after 2008-2009 and the government kept hitting the debt ceiling. The downgrade came on a Friday afternoon and was as if the market was hanging on a cliff and was waiting for someone to push it over... the downgrade was that someone. Stocks tumbled 10% or so in a very short period of time(and they were already off nearly 5% coming into the downgrade):
Hate to say, things are different now, but the reality is they are. Likely some chop at the open and then I think markets can kind of 'give the finger' to Fitch and melt higher the rest of the week pending any crazy surprises from AAPL and AMZN tomorrow. if things get dicey today, would want to see that $451 handle hold:
YOU reported a monster beat and raise this morning:
The CEO also addressed the Bloomberg hit piece on the conf call this morning , calling it 100% false and that the issue they talked about had nothing to do with their technology and has been 100% resolved. The stock is gapping higher this morning. Think $30+ comes. It has a 22% short interest so have to think some of these bear publications are short and will piggy back on the Bloomberg piece soon, so something to be aware of. May look to add some Sept strikes at the open:
After the close today TRIP reports. Already locked some calls in to cover costs so will just hold the rest of my strikes. A beat and raise and its $20+ comes. Inline or miss and the stock trades $17 and below:
FVRR, WW, and TNDM report tomorrow. Not much more to add then what I have been saying on the last few days watchlists( can read yesterdays here: https://www.optionmillionaires.com/august-1st-2023-watch-list/ )
TWLO and DOCU took breathers yesterday. TWLO still looks nice on a daily basis with earnings next week. If premiums come down, may look for strikes into next week:
Going to need a few days of green for this golden-cross to play out on DOCU:
ELF reported a monster Q after the close yesterday. Think that bodes well for ULTA which reports at the end of the month. ULTA reported a great Q1 yet the stock sold off after the report. It then bounced back in June but has now sold off for 10 of the past 12 sessions. Think an opportunity here to play some calls. May look for some weekly strikes and/or further out strikes to encompass earnings:
Still eyeing ROKU. It was a premium chop session with calls dropping in value as the implied volatility decreased yesterday. Could be an interesting bounce play on weakness this morning for the eventual move over $100:
And here is what I am watching today: UKTA, ROKU, YOU, TNDM, WW, SHW, BIDU, ALGN, ISRG, FVRR, ANET, ULTA, SSYS, BLK, Z, ANET, IBM, NFLX, QQQ, AXSM, and SAGE.
Let's have a great day!