We gapped down below the 21 ema and the 50 day today, that is not bullish at all. We reversed a bit on the news Mexico decided to send 10,000 troops to secure the border. While that was encouraging, we are just in no man’s land technically now. Bulls would like to see a gap up over 600 to clear this resistance and bears are still licking their chops at the notion our first close below the 100 day in a long time is less than 2% away at 586.99. There’s really nothing to say here until we get a more decisive move. Perhaps after AMZN and GOOG report this week and we let this tariff news be digested but right now the /NQ is down just over 200 when it was down 500 this morning, so we’ve made decent progress thus far.
The big level to watch this week is that light blue line, the 21 week ema, it sits at 586.61 right now and as you can see we have not closed below that since late 2023. Either the market finds buyers there in a worst case scenario soon or you probably need to start trimming your longs because we’re breaking a 15 month long uptrend. If we get closer, we will discuss it more but it would be a big change of character when the only 2 dips we’ve had below that in the last year were immediately bought up.
Recent Trades
TVTX - In the 1/22 recap here I highlighted this risk reversal on this obscure biotech and it has risen over 11% since to 20.43 and these risk reversal now are up nicely if you want to close them without waiting for whatever is coming, they’re up just nearly 40% in under 2 weeks.
My Open Book
I am a lucky guy, I escaped today unscathed so far and am up quite a bit actually. My 2 big positions are doing alright in this selloff. META and AMZN are the only megacaps green right now and carrying me. META especially has been a beacon of strength ever since that day we saw those huge max strike calls bought. I was assigned 1000 shares friday with those 690 puts I had sold, I simply turned around and sold covered calls for this week at 700 and got 8.70/share and now I can make $10 + $8.70 on my 1000 shares in a week. Again I have plenty of META, I don’t really want these shares but I got them right at the level I wanted friday. Now, I have to work my way out of this, worst case I’m not called away at 700 on friday and pocketed $8.70/share and do it all over next week with my new basis at 680.90(adding the .40 I got last week). META should be a PEAD candidate this quarter and it shouldn’t break the 8 ema on the daily, so until it does, I will be in this risk reversal I have. I had to close up some Jan 2026 short puts I had late friday for margin purposes when it looked like I was going to take assignment of some META shares.
Today’s Unusual Options Activity
Here is today’s link to the database as always it will be active until the opening bell tomorrow, the rest of today’s action will be added by the afternoon so check back in the link below for all the updated trades and trends.
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