Markets fell again on Wednesday, with the S&P closing down .70% as stronger than expected PMI and ISM data weighed and as Yields and the US dollar rose. Asia markets closed lower overnight while Europe indexes are mixed this morning. U.S. futures are pointing to a lower open, the Dollar and Gold are higher while Yields and Oil are lower.
Stocks chopped around after the open yesterday, trying to find footing. Then 10am came, with the release of the PMI and ISM data which came in better than expected. The 'good news is bad news and bad news is good news' theme continues to play out. Stocks tumbled after the release. Yields and the US dollar rose as well. This morning it looks like we will have some continuation. The SPY closed right near its 50dma. There is also a potential bearish cross on the MACD... the last time that happened was in late July with the SPY tapping $460. It then tumbled to the low-$430s. Something to watch. I will probably start looking for some hedges again if the SPY breaks $440. For now, think we chop between the $440s and $450s over the coming days:
It was a great morning for ROKU. The stock gapped higher after raising its revenue guidance and announcing layoffs. It opened at $92, rallied to nearly $96, before reversing course for the rest of the day to close at $86. Just goes to show how divisive this name is. I used the move to close more of my Sept $90 calls for over 1300% and some of my OCT strikes for over 400%. Will continue to hold the rest for the eventual test of $100 in the coming weeks:
WW rallied over 14% yesterday on zero news. There was no catalyst outside of huge call volume. Still trying to find time to put together a good DD piece on WW but I did post some more thoughts on twitter (X)yesterday :
This GLP-1 story is still in the early innings of taking shape. Everyday there is a new report on what else these drugs may help:
All this does is increase the use-case for a company like WW. Think $12+ soon and then much higher. Will wait for $12 to break before adding more strikes:
VKTX closed up over 3% after announcing a new phase 2 study while also confirming data will be out in Q4 from its Phase 1 study of its oral weight loss drug. $16+ is coming soon and likely higher:
IIPR closed up over 2% yesterday despite the market weakness. I used the move to close some of my $90 calls for 100%. $90+ is coming next:
BIDU has been such a disappointment so far this week. The backdrop in China is really weighing. Not going to add any more strikes just yet and would want to see it back over that 50dma this week:
Thankfully I did not add any calls on YEXT and AI yesterday for their earnings. They both posted great quarters, beating estimates while raising guidance. Despite that, both stocks are falling in the pre-market. Will be watching both for a bounce though will likely stay on the sidelines for now.
And this is what I am watching today: AI, YEXT, VKTX, IIPR,, BIDU, WW, ROKU. LULU, U, GNRC, VKTX, ULTA, ISRG, GLD, GLL, LRCX, NVDA, ALGN, CMG, QQQ, SPOT, TEAM, BLK, IBM, and NFLX.
Let's have a great day!
-JB