Welcome to the morning report, where I go over the setup for the day as it relates to day trading. I’ll review levels using options gamma and show you where the support and resistance lie along with some other proprietary metrics like options skew and my very own Day Trading Bar Score that have good track records for forecasting bullish or bearish tendencies for the day.
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Today’s Setup
We are bouncing overnight as Bitcoin continues its torrid rally. When that thing gets going it really moves. This is the seasonality for Bitcoin. Pretty much right on time here.
You can kind of tell people are tired of getting their butts kicked in these Semis and clearly shifting gears to pile into that stuff again. It’s like a meme, I swear. They are like kids that rediscover old toys again.
Bonds are treading water, but notably not below Bessent’s magic line.
August Op-Ex
It’s options expiration and we’ll await the Index options expirey in the morning, followed by the ETFs and Single Stocks in the afternoon. Stocks up the most over the last 3 weeks will be vulnerable to a rough day today.
Some examples would include:
SAP 0.00%↑ SAP
VEEV 0.00%↑ VEEV
And stuff down the most might end up rising.
That would be bombed out stuff like:
UA 0.00%↑ UA
NXPI 0.00%↑ NXPI
Once Options Expire, a lot of these stocks will take on a new personality. It’s the guts of how the market really works. Positioning resets and Support and Resistance instantly change.
Folks are pivoting to NVDA earnings next week and expectations are still sky high for them to report beats and raises across the board.
Gas Never Stopped Going Down
Oil might be down a few bucks from the highs of the Iran War, but Gasoline is not. And Scott Bessent now appears to be everywhere all at once telling us that they are done bombing stuff over there, it’s all Economic Sanctions now, as if that is an improvement to the conflict. It does appear like he’s kind of running it all at the moment. It could be one reason why none of it seems to be sticking - he’s trying to do too much at once and making mistakes.
Nonetheless, Gas says that plan is too slow to resolution and it’s moving 2% this morning and about to get to the Admin’s Red Line. Heating Oil (not shown) is well past it’s Red Line and making new Iran War highs (that’s going to sting for anyone that needs to heat their house this Winter!).
Will we see action this weekend in Iran?
Don’t forget, after Scott Bessent’s little Bond Market jawbone the INFL 0.00%↑ INFL (Inflation ETF) has gone parabolic. Not the market response you want to see as Treasury Sec trying to help your team going into the Mid-Terms.
