3/10/25

The SPY continues to languish below the previous breakout of 565.15. You can see how vicious this move down has been with the 8 ema still almost 2.5% higher and racing down to catch up. The 50 day is beginning to slope down and and that is not good. We likely are still in an environment where all pops will be sold. Every push up to 565.15 will likely face resistance there, then more resistance at the 200 day just over 570. We need to see a reclaim of the 8 ema and a few days of building over it before we can say we’re possibly bouncing. Right now these are just oversold bounces and nothing more, the 21 ema is over 585 still over 5% higher. Tomorrow morning we have CPI so let’s see where we go after that but I expect all pops to continue to be sold for now.

Recent Trades

RKT - This weekend’s best idea gapped down hard yesterday on the news of the Redfin acquisition, I think that more than anything solidified the longer term bull case. In the short term the name got whacked but that risk reversal I mentioned sunday, you should have been able to put it on for a much larger credit yesterday morning if you did. It’s always a gift when you have a trade in mind and can put it on for a bigger credit. The redfin acquisition was expensive, but overpay, I don’t believe so, when you’re a mortgage company adding 50m viewers a month looking for a home is never an overpay especially with an interest rate cute bonanza on the horizon.

The credit ballooned to $1.10 on the trade below if you placed this today. So I still think its a great trade idea long term even though the buyout of redfin blew up the chart.

My Open Book