In Wednesday’s MidWeek Video, I mentioned the Nasdaq Composite’s pattern of grinding higher for approximately 8-12 days and then pulling back in 1-3 days down to its 21-day EMA. If we saw further strength into Thursday and Friday, I was planning on reducing exposure. I reduced three ways on Thurs/Fri: 1) By reducing position size on some positions 2) By locking in some profits and 3) By getting stopped out of some stocks. The most important thing I want to stress is that everyone has different timeframes. If any of my ideas have a weekly close below their 10-week moving average, I am closing my position 99% of the time. If you don’t have the time to watch your positions, then I suggest taking smaller positions and having a longer-term timeframe. If you still like the story in some of these stocks and don’t want to close your position, just understand that it will likely take time for these stocks to base out and recover. I am still bullish on this market mainly due to the little distribution and because we’re still above the key moving averages. If we do see a pullback this week, I discuss in this video a focus list of stocks that I will be looking to buy (or add to) if the Nasdaq visits it 21-day EMA. Also, the sector rotation makes this market very difficult to short for any sustained down move. I simply prefer to have cash ready in case we pullback to shake out some of the recent excess bullishness. See you Sunday, August 9th at 7PM EST for the next Stock Screening Webinar. Good luck this week!

Link to more information on Distribution Days: https://www.investors.com/how-to-invest/investors-corner/tracking-distribution-days-a-crucial-habit/
Mike Webster’s Weekend Video: https://www.investors.com/market-trend/stock-market-update-raging-bull-rotation/

Unusual Option Activity:
8/7/20 Zillow (Z) buyer 300 Jan 2022 $105 calls $16.20
8/7/20 Zillow (Z) opening sale of 1,050 January $65 puts for $5.55 to $5.50 into strength today following earnings
8/6/20 CrowdStrike (CRWD) with 440 March $97.50 puts sold to open $12.80, popular strategy in the name for months now
8/5/20 Salesforce (CRM) with 35,000 November $200/$230 call spreads bought for $12.00
8/5/20 Facebook (FB) buyer 35,000 November $250/$275 call spreads for $10.50
8/5/20 Microsoft (MSFT) buyer 75,000 November $220/$240 call spreads for $6.75
8/5/20 Adobe (ADBE) buyer of 20,000 October $450/$490 call spreads at $17.20
8/5/20 Amazon (AMZN) with 1250 November $3500/$3750 call spreads opening in that same timeframe as other Tech large cap bets
8/5/20 Microsoft (MSFT) with 2,000 September 11th (W) $220/$230 call spreads opening early for $2.90, pushing for any TikTok deal to
be done by 9/15.
8/5/20 Service-Now (NOW) seeing smaller lots but 1900 Aug. 14th (W) $450 calls opening near $5.35 today

Topics covered:
1) 0:00 Announcements
2) 0:35 Three ways I reduced exposure this week, Discussion on selling into strength/weakness, Making decisions based on your own timeframe
3) 12:55 Market Commentary and Index Review (Nasdaq Composite, S&P 500, Russell 2000)
4) 17:05 Stock Review – Mega Caps: AMZN, FB, GOOGL, NFLX, MSFT, AAPL, ADBE, CRM, NOW, QQQ (ETF)
5) 20:35 Stock Review – Software: DDOG, DT, AYX, FSLY, CRWD, NOW, DOCU
6) 25:10 Stock Review – Biotech: IBB, XBI, SGEN, REGN, VRTX, BTAI, IDYA, SDGR
7) 27:25 Stock Review – Quick discussion of the 5 setups from Wednesday’s MidWeek Video: DT, NOW, TSLA, EBAY, CRWD
8) 29:00 Focus List if we get a pullback – AMZN, TSLA, SHOP, ZM, CHGG, NVDA, LRCX, AMD, SMH (ETF), DXCM, Z, PYPL
9) 34:25 Current Setups – DECK, GO, KR, V, MA
10) 36:50 Conclusion/Summary