U.S. stocks ended with modest losses on Monday (Feb. 26th), as the focus shifted after last week's AI-fueled rally to upcoming economic data that could affect the timing of the Federal Reserve's expected interest rate cut.
Regarding the options market, a total volume of 36,361,859 contracts was traded on Monday.
Top 10 Option Volumes
Top 10: SPY; QQQ; SPX; TSLA; NVDA; IWM; GOOGL; AAPL; MARA; VIX
Cryptocurrencies rallied sharply on Monday as investors jumped back into the market. Bitcoin traded over $53,000 for the first time since November 2021, and that's pulling the entire market higher.
Even bigger moves took place. Ethereum (ETH) jumped 8.3% since the close of the market on Friday, NEAR Protocol (NEAR) was up 21.3% on Monday, and Coinbase jumped 16.9%. Bitcoin miners Marathon Digital and Riot Platforms were up 21.7% and 17%, respectively on Monday.
It should be no surprise the rising price of Bitcoin has led to a jump in Bitcoin mining stocks. These companies not only generate revenue from mining Bitcoin -- so their revenue and gross margin will rise as Bitcoin does -- but they also hold Bitcoin on the balance sheet. This gives them double leverage when the price of Bitcoin increases, which is what we see today.
A total number of 2.47K options related to Marathon Digital was traded on Monday, of which 71% were call options. A particularly high trading volume was seen for the $30 strike call option expiring this Friday, with a total number of 66,360 options contracts trading before Monday.
Unusual Options Activity
Alphabet Inc. stock dropped as much as 4.4% on Monday following last week’s pause of a Google image generation feature that drew criticism over inaccurate historical depictions of race. Alphabet shed more than $70 billion from its market value.
Last week, Google acknowledged inaccuracies in image generation depictions of people and said it’s addressing the problems. Google aims to resume the feature in the “next couple of weeks,” Demis Hassabis, head of the research division Google DeepMind, said on Monday at the Mobile World Congress in Barcelona.
A total number of 760,065 options related to Google was traded on Monday, 2.5 times higher than the 90-day average volume. Among the total options trading volume, 61% were call options. A particularly high trading volume was seen for the $130 strike put option expiring May 17th, with a total number of 41,787 options trading on Monday.
TOP Bullish & Bearish Single Stocks
This report shows stocks with the highest volume of bullish and bearish activity by option delta volume, which converts option volume to an equivalent stock volume (bought or sold).
If we take the total positive option delta volume and subtract the total negative option delta volume, we will get the net imbalance. If the net imbalance is positive, there is more bullish pressure. If the net is negative, there is more bearish pressure.
Top 10 bullish stocks: SOUN; MARA; NKLA; LI; COIN; RIOT; Z; KGC; MSFT; HA
Top 10 bearish stocks: AAPL; WMT; RIVN; C; JD; IBRX; PLTR; WBD; BMBL; LXRX
Based on option delta volume, traders bought a net equivalent of 3,565,372 shares of SoundHound stock. The largest bullish delta came from buying calls.
The largest delta volume came from the 01-Mar-24 3 Call, with traders getting long 310,079 deltas on the single option contract.
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