4/22 Recap
Very weak bounce in the SPY today, we are working on our 7th straight red candle right now. We have not even tested the 8 ema in 5 sessions and this is just normal weakness when you get that bearish crossover I discussed over the weekend. The process of these flattening out is just something that takes time. I’d love to be an optimist and tell you we’re going to bounce, but barring some incredible prints and guides from the megacaps this week, this market is just going to take a little bit of work. The good news is the underlying fundamentals are fine, this is more of a technical thing than anything else. This isn’t 2022 where inflation was really causing worries, this is more we’ve been up for 6 months in a row in tech and now they’re moving to other stuff short term like banks, look at names like C continue up with call buying everyday or even WFC from this past weekend’s best idea. They really are accumulating banks in size. That’s probably your best pocket of safety short term.
As for these big tech charts, look and tell me what you see that’s bullish? Almost none of them, except GOOG, are above their 50 day moving average. Meta is red today after fading a $10 gap up, Meta is fine, it has a 6% FCF yield and growing rapidly, but for now, it is weak. All of these are weak, that could all change again with a big report from MSFT,META, and GOOG this week, but until then, these aren’t inspiring for short term buys. If you’re a longer term investor, there is zero to worry about. As you know Amazon is my favorite name and I still do think it’s probably $300/share by end of 2025, but look below, it tried to get over the 50 day today and rejected lower.
The chart above is just not bullish, you can also see the 8 ema crossing down below the 21 ema now. I still love the company and am holding my position, but I also know it likely will be weak for a little bit. If you’re holding a long term trade like I am looking for a long term capital gain, you have to remember that your stock likely won’t be up all 12 months, there’s going to be bumps in the road. You either have to sell early when you see it and pay short term capital gains or you have to ride them out while utilizing things like covered calls in times of weakness.
Recent Trades
Last week on 4/17 I highlighted PARA it saw a huge put sale at $10 expiring this week and it is up 13% since through a pretty nasty period in the market. That put sale was on point and it seems unlikely that player is put those shares by this friday.
Another name that’s been seeing lots of bullish trades recently was WOLF and it just spiked 11% on news that Jana Partners is pushing them to explore a sale, lots of action recently in a fairly cheap name.
Trends
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2 Week
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Today’s Unusual Options Activity
Here is today’s link to the database, as always it expires at the open tomorrow. I will have the rest of today’s trades added to the database by the afternoon.
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