Markets tumbled on Tuesday, with the S&P closing down 2%, making it the worst session of 2023. Asia market fell overnight while Europe stocks are also in the red but off the lows of the session. U.S. futures are pointing to a slightly higher open as I write this. The Dollar, Yields, and Oil are lower while Gold is higher.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-204/
It was a rough start to the holiday shortened trading week, with stocks opening the session lower, and failing to find any sustained bid, to close right near the lows of the day. The Dow, S&P, and Nasdaq all fell over 2%. Home Depot and Walmart earnings coupled with rising yields seemed to be some of the catalyst. Today we get the Fed minutes at 2pm. The SPY broke and closed under that $400 handle. Would want to see a move back above that today or I fear there maybe more downside in the coming days:
DKNG rallied out of the gate yesterday, reversing morning losses to trade up over 4%. I used the move to close the last of my weekly calls for some more profits and went and added some March strikes. The stock then reversed all the gains to close at $19.96. Still like the DKNG setup and think it trades north of $25 in the coming weeks so will hold those calls and may actually look for some later dated strikes:
I also added some inexpensive March U calls to play into earnings today. The monster APP report bodes well for U and think any beat and raise and the stock embarks on a move into the $40s, then $50+. At the same time, inline numbers or any downbeat guidance and the stock may languish. So a high risk, high reward trade. Will probably hold my calls into the close knowing they may be bid-less come Thursday:
At the end of the day I added some EXAS calls. For some reason I thought earnings were today but they actually reported yesterday after the close. I would have added them regardless. They reported a great Q and some nice updates on the conference call. I think it will rally today but the calls will be in the red at the open. If it breaks $63 or so I may look at some later dated strikes to play for a move into the $70s and beyond in the coming weeks:
MASI received an upgrade this morning. They will report earnings next week. Spreads/premiums make it tough to find a decent risk/reward strike. Will keep looking for some calls to play for a move into $170s and beyond:
FVRR reported strong earnings this morning and the stock is gapping back above $40. Only monthly strikes but may look at some March calls for a move back over $45:
Rough session for AI yesterday, though still love the name and setup. Spruce Point Capital was given air time on CNBC last week to spew his short case that folks betting on AI are speculating the company will make a profit... as if buying a stock for future growth is not the reason to buy a stock. By the time this company is profitable the stock will be much, much higher than where it is. I have been in many trades against his bearish calls and most have worked out. WIX, IRBT, ULTI, and many more. Not going to rule out more downside, but certainly looks like a bull-flag is setting up if $20 holds. Won't add more calls just ye,t and will just hold my freebies strikes, but would look to add on strength:
Lastly, GNRC received double downgrades yesterday and the stock tumbled over 8%. Think there is an opportunity for a bounce if it holds $115 today. May look to re-enter the calls:
Here is what I am watching today: FVRR, GNRC, MASI, AI, YEXT, DKNG, EXAS, U, SMG, TWLO, TRIP, RBLX, SPOT, NFLX, AYX. CMG, ROKU, GILD, CDLX, SAM, IBM, SQ, ZYME, and ICPT.
Let's have a great day!
-JB