Topics covered:
1) 0:00 Announcements
2) 0:30 Market Commentary and Index Review (Nasdaq Composite, S&P 500, and Russell 2000)
3) 7:55 Commentary on Breakout Failures
4) 11:10 Stock Review – Medical Products: SWAV, INMD, VCEL, ALGN, PGNY
5) 13:15 Stock Review – Watch List/General Ideas/Commentary: SMH (ETF), NVDA, HYRE, UPST, NVS, VOR, MGNX, RBLX, FDX, UPS, CELC, APEN, EPIX
6) 19:45 Conclusion/Summary

Market Summary:
I’ve discussed several times over the past few months how we are in two different markets. Growth stocks are correcting and I still recommend staying defensive until conditions improve. The Nasdaq Composite and Russell 2000 are both below their respective 50-day moving averages, and I would specifically like to see two things happen before getting more positive on this market: 1) Having both of those averages get back above their 50-days on some consistent days of strong volume and 2) Seeing more stocks set up and breakouts starting to work again.

The other market is the strong uptrend we are seeing in other sectors outside of growth. I mentioned how one of two things would happen: 1) The selling in growth would stabilize and eventually lift the rest of the market with it or 2) The weakness beneath the surface in growth would eventually bring down the S&P 500. I’ve been leaning towards that second scenario to happen and it is slowly doing so this week. For example, some recent strong sectors such as Retail (XRT down -2.36% today), Steel (SLX -3.37%), and Energy (XLE -2.62%) were all down today greater than the general market. I realize that it is only one day, but I interpret this as the weakness in growth starting to get to other sectors.

I would like to remind members to stay defensive and keep positions light. Some people asked me if the reversal today could be signs of a bottom. Of course, no one knows but my first instinct is to answer: BE PATIENT! I’m looking for a SUSTAINED uptrend and it will take some time before this happens. Of course, I will stay on top of the day-to-day price action and pass along any positive developments as soon as they happen, but for now, stay disciplined and be patient until market conditions improve. When they do, there will be plenty of opportunities. In this video, I review some stocks that are holding up well, and also the reason I don’t like giving setups in corrective markets (mainly because breakouts fail during corrective periods). Good luck for the remainder of the week!

Unusual Option Activity
5/19/21 Facebook (FB) earlier this morning with 3500 September $320 calls bought $19.85 to $20
5/19/21 MasterCard (MA) buyer of 1500 July $360 calls $15.20
5/19/21 Visa (V) big buyer 2500 July $225 calls $7.85 offer
5/19/21 Semiconductor ETF (SMH) with 3,500 June $245/$265 call spreads bought this afternoon for $2.70
5/19/21 WalMart (WMT) afternoon buyer 1000 December $140 calls $10.25 to $10.35
5/19/21 HyreCar (HYRE) spread this afternoon sells the June $10 puts and buys the $20/$25 call spread 5000X for $0.65
5/18/21 Western Digital (WDC) with 1000 January 2023 $70 puts sold to open for $14.85
5/18/21 Materials ETF (XLB) buyer 5000 August $90 calls for $3.08 as the June $87 adjust
5/18/21 EOG Resources (EOG) with 500 January 2023 $70 calls opening today for over $1.2M as January $60 adjust
5/18/21 Zillow (Z) opening sale 300 November $85 puts $6.20
5/17/21 Square (SQ) with 740 December $190 puts sold to open today for $24.40
5/17/21 Western Digital (WDC) with the June $90/$110 call spread being bought now over 10,000X for $0.85
5/17/21 Western Digital (WDC) also with 4000 June $95/$110 call spreads bought for $1