One of the guidelines I’ve discussed in many recent videos is that just because it’s a bull market, it doesn’t mean every trade is going to work. You still have to use stops and have some form of a loss cutting policy. The reason I bring this up is that many of the Medical Products stocks I’ve mentioned over the past month have either broken below their 10-week moving average or are acting weak in general. Some examples include TMDX, HALO, CDNA, and PRCT. Today, I sold my position in NTRA and got stopped out of my small position in AXGN when it broke below the low of its recent flag formation. Again, this is just a reminder that you still need to manage risk and that taking losses is part of trading. We simply have to do our best to minimize these losses.
I’m pleased that two of the stocks on the Focus List reported strong earnings today (TSM and ISRG). The read-through from TSM’s earnings is that NVDA, AVGO, and ARM are likely to report strong numbers in their next earnings reports. These stocks saw more bullish options flow today.
(ARM) 750 March $160 calls bought $27.10 to $27.50
(ARM) massive midday buyers of 5000 January $190 calls for $10.74 to $10.84 in a few large blocks
(AVGO) seeing buyers of 1000 June $225 calls for $12 to $12.80
(AVGO) large buy 2550 September $230 calls $14.45
(NVDA) trading 90,000 December $180/$190 bull call spreads in the opening hour
(NVDA) seeing buyer flow on offers January $170 calls 35,000X
(NVDA) sees 1000 May $150 calls buy at $19.90
(NVDA) large buyers of 6900 Dec $149 calls at $9.37 as some $145 calls adjust up
Regarding NVDA, just be patient as it will likely build a handle around the 130-140 area before heading higher later this quarter. Good luck on Friday. I will have more for you in this weekend’s video.