Every time the market has a big down day or stretch, what do we see?
Traders flooding right back into chip stocks…
I haven’t done a video in a while so I figured it’s as good a time as any to give a full market update on what I’m seeing and what I’m trading.
In a market update that’s anything but static, we’re seeing a compelling dance between the Nasdaq’s dips and a robust appetite for chip stocks. It’s as if every time the market takes a hit, investors swoop in on semiconductor shares looking for bargains. Despite a shaky start, we ended up in the green Wednesday, driven by none other than the chip sector.
Micron (MU) caught some serious order flow in the May monthly expiration, $135 strike calls coming into play.
Out of the money? Sure, but Micron’s got the legs for significant moves if you consider its average true range — just take a look at its $4 move today. But it’s not just Micron…
Nvidia (NVDA) and Advanced Micro Devices (AMD) both dusted themselves off from red to green, signaling a sector-wide resurgence.
The story of the day, however, was a mighty bet on Meta Platforms (META). Investors are gobbling up calls as if they were the last chips at the table. Netflix (NFLX) also saw some action ahead of earnings, aligning with the narrative that the ‘Magnificent 7’ are back to their old market-dominating tricks. It seems like a replay of the past with Facebook, NVIDIA, Netflix, AMD, and even Tesla, which shrugged off bad news and downgrades with a $5 uptick today.
A word to the wise: About 80% of gaps get filled, and we’re seeing those gaps close with surprising ease. So keep your eyes peeled.
I’ll cover all that and more in today’s market update video up top, so be sure and take a look at what I’m seeing and trading!
Wednesday’s Top Order Flow:
- MU May24 Strike: 135 Calls premium: $164,700 ASK BULLISH
Trade Date: April 3, 2024 Trade Time: 11:11 am - META Apr24 5th Strike: 507.5 Calls premium: $383,665 ABOVE ASK BULLISH
Trade Date: April 3, 2024 Trade Time: 11:13 am - NFLX May24 Strike: 685 Calls premium: $246,400 ASK BULLISH
Trade Date: April 3, 2024 Trade Time: 10:52 am
Note: If no date is listed after the month, it’s the monthly expiration (third Friday).
Lance Ippolito Trading Team
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
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