Futures are pointing to a red start to this holiday shortened trading week, with the S&P set to open .77% lower as I write this. Asia markets closed mixed overnight while Europe stocks are in the red this morning. Yields, the US dollar, and Oil are higher while Gold is lower.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-203/
Stocks fell for the second week in a row, although it was only a .19% drop for the S&P. This week is filled with earnings with 801 companies reporting, we get the Fed minutes on Wednesday, and the PCE inflation data on Friday. Geopolitical tensions also seem to be ratcheting up as of late, not sure that will pressure stocks just yet, but certainly something to watch. That $400 handle is getting close on the SPY in the pre-market, would want to see that hold if there is more weakness this morning. A break and close below that area and my $420 test scenario is likely off the table for the time being:
Here are the implied moves for earnings this week:
Home Depot and Walmart reported earnings this morning. HD's report was a miss all around while Walmart posted some decent numbers but offered up some weak guidance. Both are trading lower in the pre-market and will likely weigh on markets today. EXAS is set to report earnings after the close tomorrow. Still like this setup for a move into the $70s and higher. Will look for some calls to play for premium build with the plan to lock some/all in to cover costs before the close tomorrow:
U reports Wednesday after the close. APP already reported a monster quarter but the stock has given back quite a few of its gains. If U comes down to $37 or so and holds, I may look to add some lotto calls into the report:
I added some DKNG calls on Friday after their strong earnings. The company seems to be firing on all cylinders with such a huge TAM ahead of them. I was able to close most of them out for a profit to cover costs and held some into this week. I may actually look for some later dated strikes today for a move above $25 in the coming weeks:
Longer view on DKNG:
VKTX is still setting top here for a move to $15 in the coming weeks:
AI names look to have hit a speed bump. Still love AI and YEXT here. May look to add more later strikes on AI to go with my freebie calls. And may look to add some May strikes on YEXT to go with my March calls. They should report earnings the first week or two of March:
And lastly, MASI is on watch today. They report on the 28th and the stock has consolidated its recent rally. Think a move past $175 is in the cards before they report and then possible $190+ after earnings. MASI is such a great story:
And here is what I am watching today: YEXT, DKNG, MASI, EXAS, U, SMG, TWLO, TRIP, RBLX, SPOT, NFLX, AYX. CMG, ROKU, GILD, CDLX, SAM, IBM, SQ, ZYME, ICPT, ALGN, and GNRC.
Let's have a great day!
-JB