Anybody Buying Yet? Where’s the Bottom?

[Flatrock]

I refuse to speak Dow. Had to convert that to S&P. Seems like you think we are giving up all YTD gains and even some of December. The economy would need a a solid kick in the sack to get there. June 21 will be the tell. Lots of call options stacked across the curve on that date. If we get there I will find a way to be a buyer, which is probably why we won't get there.

Do you find that it's ever useful to pay attention to option expiration? You just using it for very quick trades? IMO, unless you're doing a trade with the timeframe of just a few days, option expiration is meaningless.

 

[Flatrock]

I’m waiting for a stock split

June 7

 

[SAJ-99]

Do you find that it's ever useful to pay attention to option expiration? You just using it for very quick trades? IMO, unless you're doing a trade with the timeframe of just a few days, option expiration is meaningless.

Oh, I most certainly do. Options expiry matters a lot. Maybe not the specific day, but the various times that lead into that day. Because options have become so popular, more of the flows are coming from market maker hedging the options exposure. As soon as options expire, the flows ramp back up after options are reset. It isn;t a coincidence that the low from the April selloff was the option expiration and stocks turned up. Here is a link that explains it in more detail. News certainly affects money flows and can overwhelm hedging activity, but in markets that chop higher, those dates are key.

Options Vanna & Charm

Two Greeks are increasingly mentioned as traders seek to better define the impact of the options market: Vanna and Charm.

spotgamma.com

I’m waiting for a stock split, might be a good indicator

The stock spilt should provide a little boost to option acitivity. Right now one option covers $120,000 worth of stock. Not a lot of retail traders can afford the options or take that risk. Cut it to $12,000 and your option activity should increase by more than 10x. On the downside, it means someone with 100 shares will have 1000 shares and they might be more willing to trim the exposure by selling some. The trimming should be complete in the first few weeks, the option benefit should keep going.

 

[Deleted member 56631]

Oh, I most certainly do. Options expiry matters a lot. Maybe not the specific day, but the various times that lead into that day. Because options have become so popular, more of the flows are coming from market maker hedging the options exposure. As soon as options expire, the flows ramp back up after options are reset. It isn;t a coincidence that the low from the April selloff was the option expiration and stocks turned up. Here is a link that explains it in more detail. News certainly affects money flows and can overwhelm hedging activity, but in markets that chop higher, those dates are key.

Options Vanna & Charm

Two Greeks are increasingly mentioned as traders seek to better define the impact of the options market: Vanna and Charm.

spotgamma.com

The stock spilt should provide a little boost to option acitivity. Right now one option covers $120,000 worth of stock. Not a lot of retail traders can afford the options or take that risk. Cut it to $12,000 and your option activity should increase by more than 10x. On the downside, it means someone with 100 shares will have 1000 shares and they might be more willing to trim the exposure by selling some. The trimming should be complete in the first few weeks, the option benefit should keep going.

Yeah I’m curious to how committed investors will be and look forward to the short squeeze

 

[Treeshark]

Unless you're Cathie Woods.

My investment in ARKK had to have given her brain damage…

It is almost impossible for the timing of her stupid decision-making to be that coincidental.

 

[cgasner1]

If I was smart I’d sell it and book a sheep hunt. Just tell my wife next spring I won it in a raffle

 

[Flatrock]

Oh, I most certainly do. Options expiry matters a lot. Maybe not the specific day, but the various times that lead into that day. Because options have become so popular, more of the flows are coming from market maker hedging the options exposure. As soon as options expire, the flows ramp back up after options are reset. It isn;t a coincidence that the low from the April selloff was the option expiration and stocks turned up.

They matter a lot to who? People who are active traders? A 5-7% pullback is a nothing burger for the vast majority of investors. Maybe expiration had something to do with the April pullback and bottom but I would say it had a lot more to do about bond yields than expiration. Stocks really started to pop as the 10 year went below 4.5%.

 

[SAJ-99]

They matter a lot to who? People who are active traders? A 5-7% pullback is a nothing burger for the vast majority of investors. Maybe expiration had something to do with the April pullback and bottom but I would say it had a lot more to do about bond yields than expiration. Stocks really started to pop as the 10 year went below 4.5%.

Agree it doesn’t matter to most investors. To them it’s noise, as it should be. You asked a me, specifically a question, I answered, but you are correct in that it shouldn’t matter to most.
Why is 4.5% so special a level? Particularly when the largest names that are driving this market don’t need debt at all. Those that do, small caps, are down on the year. Seems you are looking for signals through the noise. And the yield on the 10yr shouldn’t matter to most investors either. So

 

[Deleted member 56631]

Dividend reinvest and sleep easy. Take profits in may and go fishing.

GME-? What’s the attraction?

 

[Flatrock]

Agree it doesn’t matter to most investors. To them it’s noise, as it should be. You asked a me, specifically a question, I answered, but you are correct in that it shouldn’t matter to most.
Why is 4.5% so special a level? Particularly when the largest names that are driving this market don’t need debt at all. Those that do, small caps, are down on the year. Seems you are looking for signals through the noise. And the yield on the 10yr shouldn’t matter to most investors either. So

I was just asking why you said expiration matters a lot when it isn't a concern for the vast majority of investors.

Markets are obsessed with bond yields. I'm just saying that the 10 year moves markets and is one hell of a lot more important than option expiration.

 

[SAJ-99]

I was just asking why you said expiration matters a lot when it isn't a concern for the vast majority of investors.

Markets are obsessed with bond yields. I'm just saying that the 10 year moves markets and is one hell of a lot more important than option expiration.

Maybe it is best to say that option expirations matter a lot in the proper time frame. The June 21 expiration doesn’t matter if you invest to retire in 10 or 20 year. June 21 expiration matters a lot to where the index will be on June 22. Ironically, the more people buy and hold and target the price in 10yrs, the more the flows from the little things drive the price in the short term.

10yr yield is noise to stocks. Media has current attached themself to it as the narrative because they have nothing else. It’s been boring and yields sounds good and people, even professionals, buy into it. It will need to break above 5 or below 4 to matter, and that will need data that will become the new narrative. See jobs data tomorrow for an example.

 

[Sytes]

Dividend reinvest and sleep easy. Take profits in may and go fishing.

GME-? What’s the attraction?

The attraction is the short squeeze though it will not last. GME is a struggling company that didn't roll when rolling was needed into the online market for their brick and mortar locations.
Not a stock worth holding. If played, good $ is ripe for the taking, both long and shorts on and off over a few months.

 

[Deleted member 16864]

Biden shit his pants l! Sell! Sell! Sell!

 

[Sytes]

I believe INTEL holds potential.

 

[Deleted member 56631]

The attraction is the short squeeze though it will not last. GME is a struggling company that didn't roll when rolling was needed into the online market for their brick and mortar locations.
Not a stock worth holding. If played, good $ is ripe for the taking, both long and shorts on and off over a few months.

Better cash out

 

[Deleted member 56631]

I believe INTEL holds potential.

Intc was a big holding of mine for years but I can’t say intc can compete in terms of stock performance. Perhaps they can turn that dinosaur around

 

[popeyoung12]

Imo, the first rate cut will be dec. And the economy is slowing, so top and bottom lines will suffer. A correction is coming, my guess 9/24. Besides, m1 and m2 is out of whack. When sp hits 4700, I am all in. Fun to watch and gamble.

 

[noharleyyet]

Biden shit his pants l! Sell! Sell! Sell!

 

[Sytes]

Intc was a big holding of mine for years but I can’t say intc can compete in terms of stock performance. Perhaps they can turn that dinosaur around

INTEL difference they were late to the AI party w/ a failed push whereas AMD competed with INTEL (CPU) and NVDA (graphics cards), turned AI.
We'll see how Lunar Lake turns out.

 

[antelopedundee]

Nvidia, the thing I will miss is the big price swings on good days like $50 or $60 or $80 per share just like Amazon and will be the same for Chipotle.