4/11 Recap

PPI came in cooler than expected and equities bounced, the SPY is still stuck below the 21 ema, I hate to say it but that isn’t bullish. It looks like tomorrow will be the day the 8 ema crosses down through the 21 ema for the bear cross unless bank stocks somehow send the market soaring tomorrow.

Still though megacap tech seems like the trade for the time being which is odd because it comprises most of the market, so what is it telling us that those are very strong and the market is weak? Is breadth about to narrow again to just a few leaders? We will see but oil may be telling us something with leaders like XOM cooling off and the XOP having a big reversal. Maybe tensions in the middle east settle down and oil sells off? It’s had an unbelievable 45 days.

I saw some people in the current trades channel talking about RIVN and the move down today. When I wrote up RIVN a month back as a best idea, I specially said “ I would not suggest buying common”. The reason was, there was no real catalyst for the stock, they were on the cusp of releasing a new car but nothing material to earnings anytime soon so I suggested a risk reversal that could’ve paid you to wait for the story to unfold selling puts way lower at $5 out in 2026 right as that car was about to begin deliveries.

I hate hearing some of you lost money on RIVN because you bought stock or calls, but I take the time to explain how to structure trades so that doesn’t happen, if you ignore me and do your own thing, I can’t help. I always try to put trades on in a way where if the trade doesn’t work, you can still be ok. Those short puts on RIVN I suggested are down like 10% right now at $1.33 but they’re still nowhere near risk of assignment, that would need another 40% lower. There’s a method to my madness and I try my best to suggest put sales right at levels that shouldn’t be horrible to go long at in a worst case scenario, usually at support of some sort or in this case a deep value. In the future if you decide to just buy stock, always sell covered calls immediately when you take your position. Your position should always have some degree of protection whether its lower or higher above.

Recent Trades

On the bull side SMTC is up 5.75% right now, I highlighted that one yesterday as some odd calls came in at the max strike next month. I love when these trades work instantly.

So in yesterday’s recap I sent out, there was this bearish table, look at that GL trade, someone bought 1800 puts on Globe Life yesterday and it is decimated today down big time at -30%.

Amazingly, a notorious short seller dropped a note this morning on the fraud going on at Globe Life and the stock instantly dumped.

Again, here is where all this unusual options activity really shines. You pick up all the odd action. You have to wonder, were those put buys yesterday affiliated with those guys, if that wasn’t the case, I would say that was tremendously lucky timing on a name that sees nothing…..again why you really need to focus more on the obscure names in here and less on the megacaps because those see all sorts of action.

Trends

1 Week

2 Week

1 Month

Today’s Unusual Options Activity

Here is today’s link to the database, as always it expires tomorrow at the open and I will have the rest of today’s action added in later in the day. One thing you will notice today is puts bought lead the way, that almost never happens. Lots of pessimism in the options data today….