Futures are pointing to flat open asI write this, after last weeks rally. Asia markets closed higher overnight while Europe indexes are mostly in the red. The US dollar and Gold are lower while Yields and Oil are higher.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-260/
The S&P traded into 2023 highs last week, with the SPY finally breaking into the $420s - an area I have been chirping about for sometime. Earnings season and Economic data is winding down into the end of the month, so will be interesting to see if market can hold their ground. This week we still have some retailer earnings along with NVDA and get the Fed minutes on Wednesday. Friday we will get the last April inflation data piece with the PCE. The question is what will the next headwind for markets? Bear are clamoring over this lack of breadth, where only a few stocks are leading the market higher. I am sure it gets clicks even if they are wrong:
And now the Debt ceiling seems to be the another catalyst bears are pointing to for a crash... although this is not close to being the first time(or last) that the U.S. Government has come close to defaulting on their debts. Of course, if there is a default, markets will tumble. A good example of what could happen was in the summer of 2011, when Standard & Poor's downgraded the U.S. credit rating. Think markets were down over 3% that day and struggled most of the summer. That would be the biggest risk, but think there is little possibility that would happen. The SPY struggled to hold that upper Bollinger again on Friday. May need a day or two before that breaks and we head back above $420:
I added BLK calls on Friday. Think the stock has been sold off with the rest of the financial sector despite not having the same risks. It struggled to hold the 200dma at $672. Think once that breaks and holds $700+ comes. May look at some other strikes today:
ICPT had their AdCom on Friday and the committee voted against their NASH drug. It does not mean the FDA won't approve, but certainly makes it unlikely. Not going to be trading that one in the foreseeable future and the vote bodes well for MDGL and VKTX. VKTX has closed in the red for 3 straight sessions. That comes to an end this week and think all-time highs coming:
ROKU failed to follow-thru on Friday after the positive news from NFLX in regards to their ad-tier subs. Will need some catalyst this week for that $60+ move(which I think comes soon):
There are still plenty of earnings this week, here are the implied moves:
As I usually do, will be watching ULTA into earnings. The stock is off over 10% this month and think there is an opportunity for premium build into their report Thursday. May look at some calls:
WING and MDGL are also on watch this week:
WING to retrace its earnings move and break $230:
And MDGL to head back over $300 as ICPT's vote removes a NASH competitor:
And this is what I am watching today: ULTA, WING, WW, RARE, WIX, ZYME, BLK, CMG, SPOT, OLED, VKTX, AXSM, SAGE, RARE, SRPT, BLK, EXAS, RARE, GLD, W, SHW, ABBV, GLD, ALGN, SAM, EDIT, BLK, SITE, SMG, and ULTA.
Let's have a great day!
-JB