2/20/25 Live Trading Room Market Recap & Trades
A few rants this morning on potential for FX volatility to not only trigger equity volatility, but for sovereign bond duration shock to trigger equity volatility.
And why do I say that? Because my yen triggered last night on news
Geoffrey says: “Looks like SVB on steroids.”
“better hope that the bank run is stopped on Norinchukin... A currency long that has to be unwound like mid last summer? NOTHING BURGER A bank forced to offload sovereign bonds because they have a deposit flight? That's your REAL carry trade unwind.”
I warned clients last month to be on the look-out for
It could explain in part the massive VIX call buying past few days I’ve been tracking live.
Traders Piling Into VIX Call Hedges Raise Pressure on Dealers
EARNINGS
Wed, as discussed live & in trading room notes, I rec’d bearish CVNA + WMT but bullish $BABA + $NTR earnings. ✅✅+ ✅✅
CVNA rejected at stated Mo resistance 286 + opened below 268 where I said it was also a great chase back into 10W 245 with overshoot to 240. It hit 234 before bouncing. Bigger picture, it formed a bearish engulging on wkly which translates to weakness back into 220 area, but don’t rule out a bounce at 55D!
WMT was not only extended but I posted yday a fundy case on why they could revert to the mean near 96. It gapped down premarket to 94.30 after disappointing on outlook, before settling at 97. Once 96 breaks, 93.58 then 92.50 would not surprise.
BABA is simply beautiful beast of continuation. They gapped up to $145 before closing at 137. I had 134-140.70 as next PT so this is where I see digestion!
NTR also beat but didn’t have a big move. It is just forming a nice trend reversal pattern on wkly. Needs to get stay/54/55. Has a good look.
Thurs morning I revisited bullish bets in NEM + CELH. Since reporting afterhours…
NEM continued to accumulate bullish bets; today it was April $50C and more Mar $50C. It tagged 50 AH, currently 49.
CELH was presented near open Wed morning > 24.20. Pushing 34 afterhours. If you recall that was my SWING long PT but it hit it in a day. Nice job if long.
CONTRIBUTOR’S CORNER:
Alexander keeps bringing up CADL in trading room which he is long. It has risen 40%! Can herpes virus drug kill cancer? Let’s hope!
Mikey says:
Still have my PEP long; I remember when KO exploded higher - said that I should have taken the other soft-drink lol... but - I had short puts on PEP (closed those already in profit) and have a long call lotto that I bought with some of the credit from the short puts. PEP 01.16.26 250 call 0.25¢ debit (free trade for me - just spending some of the profits from a closed short put spread)
Geoffrey is clearly crushing it with his China plays - mostly BABA. He is now up 78% YTD in his overall China-centric portfolio with 1.9X leverage.
Let’s update CHASE, SWING & TREND trades: