Equity & Options
Market Research, Analysis
& Strategies
is the premier site for active option and equity traders offering real time coverage of markets via options activity alerts, technical set-ups, breaking news, in-depth research and much more.
Set-Ups
Talk
Weekly
market
View
The SPX closed higher by 6% on the week and about half of that move came on Friday to close the week with a sharp rally into 3900. With prices closing back above that level, it’s back to a tricky spot as quarter end nears but using the 8/21 EMA as a road map for short term bias will be key. MACD is crossing to the bullish side so the market might be willing to follow through higher into quarter end. Staying above 3900 can potentially see 3970-4000 if the markets want higher but with 4 days left in the quarter there might be a lot of whipsaws back and forth action as well. The next overhead level is near 4000 where the open gap exists from two weeks ago. If the market traded up into that it would likely be met with stiff resistance near the 55 EMA and start to become short term overbought. The 4110 level from the February lows continues to be a more longer-term line in sand for trend.
Market Sentiment/Breadth
AAII sentiment for the week ending 6/22 showed bullish responses drop to 18.2% from 19.4% prior while bearish responses rose to 59.3% from 58.3%. Neutral sentiment steady to 22.5% from 22.2%. Optimism is at among the lowest levels recorded in the survey. At the same time, pessimism rose to one of the highest levels ever recorded. NAAIM Exposure fell sharply to 19.86 and is in extreme bearish sentiment. Lipper fund flows for the week ending 6/22 had $5.4B of outflows of equities. Friday’s close saw NYSE new highs at 10 while new lows of 68, bearish breadth but improving. The percentage of SPX stocks above their 50-MA is 22.4% while those above their 200-MA was 24%. NYSI and NASI Summation index both below the 8-MA but starting to curl up. NYMO rose to 0 to end the week in flat and neutral. Cumulative AD remaining in a downtrend below the 40 EMA short term and 89 EMA long term. CBOE Equity P/C 50-day MA at 0.67 and at very high levels. CNN Fear and Greed in Extreme Fear zone at 28 from 14 last week.
Open
Interest
Alerts
Cytokinetics (CYTK) highlighted this morning to members with a buyer of 1000 July $45 calls $1.90 and has the 1000 Jan. $20 calls bought 12/27/21 in open interest holding for more. CYTK an impressive chart breaking out of a weekly value range with bullish moving average slopes and outperforming Biotech peers.
CYTK recently announced that the PDUFA for myosin activator omecamtiv mecarbil (OM) for the treatment of heart failure with reduced ejection fraction (HFrEF) has extended by three months to February 28, 2023. CYTK believes recently approved Camzyos from BMY opens the door for the drug class and views afi as potentially next in class in the space. CYTK is a late-stage US biopharma focused on developing novel therapeutics based on sarcomere (muscle cell) biology, making it unique in its approach. CYTK's current primary focus is cardiovascular (CV) disease, and lead asset omecamtiv mecarbil (OM), which is partnered with Amgen (AMGN).
Biotech M&A has been heating up and after scoring big last week in SeaGen (SGEN) that showed similar characteristics of relative strength in price action and unusual upside call buying, CYTK could be a candidate. It is seen as a M&A candidate with the potential for aficamten in oHCM in light of past consolidation in this disease area combined with the potentially large TAM in the disease, Goldman notes a $71 M&A value. Amgen (AMGN) would make sense as a logical buyer, its partner.
Chart
Set-Ups
Academy Sports (ASO) shares flagging right under monthly value area high with MACD crossing bullishly after making a recent higher low near 33. Higher short interest name at 11% of float. Potential to pop up into 40 on strength and squeeze above May highs.
Market
Talk
The SPX closed up 6% on the week and about half of that move came on Friday to close the week with a sharp rally into 3900. The market showed some capitulatory signals last week into lows with breadth washouts and very heavy put volumes so getting this rebound into the 21 EMA was the likely outcome into the end of month. Now with prices at that level it’s back to a tricky spot as quarter end nears but using the 8/21 EMA as a road map for short term bias will be key. Staying above 3900 can potentially see 3970-4000 if the markets want higher but with 4 days left in the quarter there might be a lot of whipsaw back and forth action as well. The VIX closed the week back to near 27 but still did not get absolutely crushed like one might expect with the large rally off lows for the SPX. Realized volatility remains high in the market and right now it likely still points to two sided swings up and down but the market was overall very oversold coming into this week. Now as things normalize it will be important for breadth and market internals to steer the ship higher if that is the path of least resistance. It will become clear what the path is the next few weeks just by watching breadth and the amount of new highs/lows overall either improving or not. The sector leaders for the week were in Biotech +13%, Internet +13%, Homebuilders +9%, and Software +12.5%. Laggards included Energy -8%, Gold Miners -3.5%, Agriculture -1.5%.
Flow
Recap/
Highlights
Options flows for the week showed put buyers in some weaker growth snapback names like COIN. But the metals and energy names saw the bulk of put buying as well as size put buyers in consumer spending stocks like PTON, ROKU, EL, BBY. Travel names like HLT, EXPE, WYNN, LVS saw bull flows by Thursday and China names continued seeing bullish action. Opening call sellers were active in the commodity space and ITM put buyers active in Homebuilders into the Friday rally.
OptionsHawk
OptionsHawk is the premier site for active investors
We provide real time coverage of the market via options activity alerts, fundamental research, breaking news, technical set-ups and alerts, earnings strategies, sell-side commentary and much more. We provide a full suite of research and analysis to allow investors to make better informed decisions.
Our Mission
OptionsHawk is an idea generation and research platform providing accurate, unique, and high quality analysis of the equity and options market in real time. OptionsHawk aims to be the premier community for traders and investors as we simplify and maximize the efficiency of your research process while also handpicking and presenting the best ideas based on our many years of experience in a concise and timely manner.
Our Process
We integrate all methods into our process to give the most thorough assessment of a company, which includes fundamentals, technicals, institutional option and equity flows, management commentary, Macro views, catalyst discovery, and sell-side research.
Our Vision
The Hawk symbolizes the ability to use intuition and higher vision in order to complete tasks or make important decisions. Hawks also encourage you to use laser focus and precision to get things done, and to take the lead in life. The hawk represents focus, strength, and poise, and as messengers to learn powerful lessons or expand your knowledge and wisdom. The Hawk encapsulates our company vision.
Browse and Compare Options Hawk Products