Some of my favorite action, both in money flow divergences as well as unusual options activity. Even useful for non-options traders, as most of this data correlates to equities as well.
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DrosNotes - 08.19.2018 - Stock Market Outlook
1. DrosNotes August 19, 2018
DROSNOTES | 08.19.2018 |
RECAP AND WEEK AHEAD
First and foremost.
Elon isnât going to jail. The tweet in question is worded as such.
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2. DrosNotes August 19, 2018
Notice the âconsideringâ word. That mitigates the entire sentence which even a cheap lawyer (of
which Iâm sure he retains the best) could defend in court. Because it means heâs CONSIDERING
taking taking the company private and CONSIDERING that price per shareâŠ.and heâd CONSIDER it
if the funding is secured.
An important point to keep in-mind is that he posted this after the Financial Times posted an article
about a Saudi fund considering taking on a major stake in the company. So i believe it was
mitigation. Perhaps there are ongoing talks which the articleâs author revealed that Elon and those
he is in possible talks with didnât want such things revealed. More on that here.
SO WTF is going on with the markets?
I wish I could give you a straightforward answer based on some of the evidence weâve seen so farâŠ
but I canât. Anyone who isnât on the âinsideâ who claims to know what is going on is just lying to
you. Weâve never seen a central bank inject so much capital into the system and then withdraw it.
We are oïŹcially in unknown waters. But I donât see a mega crash coming anytime soon. The Fed
wants to unwind those bonds slowly as to not crash the price of them on account of their own
selling. That would lower the price of the bonds and the Fed, just like any other investor, doesnât
want to lose money. Thatâs why dark pools exist. Ever been to a treasury auction? I havenât, props if
you have; but the takeaway of being a part of one doesnât matter. The past few auctions have seen
treasury prices spike and the markets turn down.
What I can tell you is what I see and possible buying opportunities.
[Note this list is partial, members of my room get a more thorough list as well as their questions
answered promptlyâŠ.still free: https://droscrew.echoïŹn.co - just say hello in the welcome room and
Iâll grant you the privileges.
Now some stock picks:
$TSLA - The bottom might not be in yet but I think this is a great spot for LEAPs or equity. It is
under the price it was when Elon made the tweet pictured above; and more positive evidence of his
proposition being unleashed have been conïŹrmed. I like anything around 380-400 strike price on
calls, out to at least October.
Based on Money Flows:
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3. DrosNotes August 19, 2018
Bullish:
- $AMZN - Friday saw the stock decline, but the money ïŹow was at +155.51 million bucks.
- $MSFT - Price declined Friday, but the money ïŹow implied buying with a 144.87 million money
ïŹow accumulation.
- $UNH - Price down, money ïŹow accumulation +127.03 million dollars.
Bearish
- $AAPL - Price up, money ïŹow accumulation -693.2 million dollars.
- $ACN - Price up, money ïŹow accumulation -124.53 million dollars.
- $AMGN - Price up, money ïŹow accumulation -90.43 million dollars.
- $BKNG - Price up, money ïŹow accumulation -153.88 million dollars.
- $CVX - Price up, money ïŹow accumulation -162.76 million dollars.
- $EL - Price up, money ïŹow accumulation -90.79 million dollars.
- $GRMN - Price up, money ïŹow accumulation -94.60 million dollars.
- $HD - Price up, money ïŹow accumulation -108.29 million
- $NOC Price up, money ïŹow accumulation -113.15
Thatâs it for this version of DrosNotesâŠ
The data above and the top money ïŹows below are via SuperStocks.
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4. DrosNotes August 19, 2018
So thatâs some money ïŹow based stuïŹ. Hereâs some options-based picks.
The âdrosFlowâ (my favorite bets) on Friday:
- $QQQ JAN19 $187 Cs - while towards bid-side, I like this trade because the market feels like it
wants a correction, and that expiry gives you a chance for upside even through a short pullback. I
wouldn't buy a ton of these. But a few wouldnât hurt.
- $XLE 31AUG18 (Weeklys) $72.5 Cs - a bit riskier with the short expiry but oil seems due for a
popâŠthis would capture that somewhat safely and with a higher % than $USO.
- $IRWD NOV18 $20 Cs - time is on itsâ side and i love the chart.
- $NGF OCT18 $60 Cs - very aggressive order placed, .15 spread and he just hit ask with no
worries.
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5. DrosNotes August 19, 2018
As always, trade safe. You can never know what the big money is doing with trades like any of the
aforementioned.
If you have any questions hop in the room or message me StockTwits or Twitter. The room gets the
fastest responses.
The above are observantions and not trade recommendations. Trade at your own discretion.
Cheers,
-Dros
www,androstrades.com
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