8/10 Recap

CPI came inline and the market bounced back some. Tomorrow we have PPI to navigate in this endless minefield of datapoints. We completely reversed the move up today and as of now are forming a pretty hideous inverted candle on the SPY. We keep trying to get over that 8 ema and just keep being rejected there daily. This is not a sign of strength at all. The market has been in distribution mode for over a week now.

You can see the intraday move here on the /NQ, tech stocks just sold off all day after that CPI pump. It’s going to be very difficult for the market to rise without the megacaps. In 2022 the megacaps were weak and so was the market, they’re just too large of a weighting now. They basically are the market at this point.

Apple specifically remains the weakest component. It is the only one red right now as the rest are slightly green. Apple has faded everyday since its earnings and is working on its 7th red candle in 8 days. Even the one green candle below was barely that. This one in particular considering the weighting of 7% is really weighing on everything. As long as it remains below all those moving averages that are sloping down, this is going to be a thorn in the side of the market because it’s going to weigh down the tech megacaps because the “magnificent 7” everyone talks about are just about 30% of the weighting in the SPY.

Trends

Well the trends I mentioned in yesterday’s recap of BABA and DIS played out today. BABA is up 6% right now and DIS is up 4.5%. Those names were coming up repeatedly over the recent timeframes and DIS especially with that huge near $20m buy of in the money calls yesterday worked out perfectly. Today it was RIVN that was seeing alot of bullish positioning for the forward timeframes as you will see below.

Week To Date

2 Week

1 Month

Today’s Unusual Options Activity

The one that stood out today was CPRI. It is up 56% right now on the takeover talk underway. I had noted this one in multiple recaps recently. You can see those 3 huge call buys of 5000x on 7-19, 7-24, and 8-7. Those paid out a fortune today. The stock is sitting at $54.xx today. These smaller names continue to be pockets of alpha within the dataset. I’ve lost track of how many of these smaller trades boom shortly thereafter but with the PENN trade 2 days ago and now this, it has been a good week for the “lucky” call buyers.