May 18th, 2022 Watch List

Markets rallied on Tuesday, with the S&P and Nasdaq both closing up over 2% with stronger than expected retail data and news that the Covid lockdown in China will soon be ending providing the catalysts. Asia markets closed mixed overnight while Europe stocks are in the red this morning. U.S. futures are pointing to a lower open, the Dollar, Yields, and Oil are higher while Gold is lower.

And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-25/

And my rant from yesterday if you missed it: https://www.optionmillionaires.com/jb-pre-market-rant/

Futures are pointing to a rough start to the day, as Target reported earnings that disappointed and offered up plenty of caution citing increased costs and logistical issues despite a consumer that still seems strong, This is on the heels of WMT and HD earnings yesterday that saw both stocks fall, with WMT dropping the most in decades. Whether this is a 'pulling off of the band-aid' moment or the start of a trend will be seen in the coming months. Yesterday Powell spoke at the WSJ Future of Everything Festival and chalked up more hawkish comments. If the SPY can't hold $400 this morning, will not bode well and a retest of the low $390s will come quick:

YOU rallied again yesterday and I was able to close some of my calls for over 100% and held the rest. The market dip this morning will not help the rest of my position. Still love the story and may add some later dated strikes on any severe weakness... ie. $31.50 or so:

I will try and put my thoughts together in a DD post in the coming days but some of my tweets if you missed:

IBM had another strong session and is nearing that $140 resistance. It has actually held up well on down days for the market. Hoping it can hold up again today and look to test(and break) that $140 resistance before the week is out:

BPT closed slightly in the red yesterday but should show some strength today as Oil is higher. Not looking to add any more strikes as of yet but if it clears the $17.29 multi-year high, I may look to add some more calls past my June strikes:

SSYS gapped higher at the open yesterday after strong earnings and guidance. It then remained rangebound between $19 and $19.50 - a good sign that it actually held the gains. If it can find support today I will look for later dated strikes to play for a move into the $20s in the coming weeks:

If stocks can't find footing this morning I may look at some speculative puts, likely in a name like ULTA, which should be pressured in sympathy with TGT earnings. On the flip side, will be looking at spec calls in the same names I have had on this weeks watch lists if the market finds a bid: SAM, TRIP, and U.

Here are the analyst changes of note for today:

Workday price target lowered to $300 from $340 at Wells Fargo
Wells Fargo analyst Michael Turrin lowered the firm's price target on Workday to $300 from $340 on multiple compression across software. The analyst keeps an Overweight rating on the shares
RingCentral price target lowered to $115 from $150 at Wells Fargo
Wells Fargo analyst Michael Turrin lowered the firm's price target on RingCentral to $115 from $150 on multiple compression across software. The analyst keeps an Overweight rating on the shares
Adobe price target lowered to $525 from $600 at Wells Fargo
Wells Fargo analyst Michael Turrin lowered the firm's price target on Adobe to $525 from $600 and keeps an Overweight rating on the shares. The analyst notes that rising rates, inflation, E. European conflict, and tightening labor markets have each contributed to increasing concerns around a tougher spend environment and potential recession in late-2022/2023, thus having an outsized impact on software valuation levels of late
Roth Capital upgrades Salesforce to Buy with $242 price target
As previously reported, Roth Capital analyst Richard Baldry upgraded Salesforce to Buy from Neutral with a $242 price target. The analyst notes that since he cut his rating to Neutral in late 2017, Salesforce's shares have appreciated at a 10% CAGR despite a 25% revenue CAGR. Given a near 50% selloff versus their 52-week highs, Baldry believes Salesforce's resulting 5.6-times run-rate revenue multiple now adequately factors in its less savory operational tendencie
Jumia Technologies price target lowered to $9 from $11 at Stifel
Stifel analyst Lamont Williams lowered the firm's price target on Jumia Technologies to $9 from $11 and keeps a Hold rating on the shares after the company reported Q1 GMV growth that was largely in-line with his estimate and an adjusted EBITDA loss that was slightly below his expectation as the company continues to invest. While Jumia expects to accelerate GMV growth through the balance of the year and to reduce EBITDA losses beginning in FY23, its commitment to drive platform usage/monetization growth through strategic investments and initiatives to diversify its revenue base comes at a cost when its markets are still early, potentially limiting the ability to scale in the near to intermediate-term, Williams said

And here is what I am watching today: ULTA, SSYS, YOU, SAM, TRIP, U, RBLX, ROKU, CMG, DUST, JDST, and IBB.

Let's have a great day!

-JB

JimmyBob (Scott)has been trading equities for over 15 years, a majority of which were OTC micro-cap stocks. He started trading high risk stock options over the past 7 years, and has proven winning trades in excess of 15,000%.

As one of the Co-Founders of optionmillionaires.com, Scott enjoys sharing his knowledge with other investors through timely blog posts, daily watch lists in the forum, weekly webinars, and helpful advice within the chatroom.

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