To The Moon

Investors turned more cautious on rate cut expectations, leaving indexes roughly flat as bets on Fed easing unwound, driving a pullback in risk assets. Meanwhile, the meme stock frenzy saw another twist, with GameStop and AMC Entertainment giving back some of their recent gains.Friday, May 17th marked the monthly options expiration. SPY and QQQ saw heavy volume focused on settling this week's expiring contracts. For small-caps, bullish flows continued in the Russell 2000, with expectations capping upside below 12.9% by year-end.Details:The S&P 500 ETF (SPY) saw open call interest rise 0.8% over the past 5 days. Open put contracts increased 0.4% over the same period.For call options, the most actively traded was the $SPY 202405

Investors awaited comments from Fed officials for clues on the next policy moves, after the previous day's mild inflation report fueled rate cut hopes and drove major indexes to fresh record highs.Options market data suggested a positive view on the S&P 500 for May, though longer-dated butterflies spreads pointed to a gradual bearish shift. Upside room kept expanding in QQQ, with expectations for a 2.2% rally priced in by late May. For small-caps, bullish flows continued in the Russell 2000, with expectations for a 1.2% rally by month-end.Details:The $SPDR S&P 500 ETF Trust(SPY)$ saw open call interest rise 2.4% over the past 5 days. Open put contracts increased 5.6% over the same period.For call options, investors sold the most

The latest U.S. data releases showed April CPI and retail sales cooled, with the CPI report prompting markets to price in a faster pace of Fed rate cuts this year.Options market data suggested a continued positive outlook for the S&P 500, though longer-dated put buying remained. Upside room kept expanding in QQQ, with expectations for a rally over 1.3% priced in by May 20 expiration. For small-caps, bullish flows continued in the Russell 2000, with expectations for the index to hold above 210 through June 21.Details:The $SPDR S&P 500 ETF Trust(SPY)$ saw open call interest rise 0.9% over the past 5 days. Open put contracts increased 1.7% over the same period.For call options, investors sold the most

Previous U.S. data releases showed persistently elevated inflation, leading markets to price in a slower pace of Fed rate cuts this year. Meanwhile, comments from Fed Chair Powell later on became the focus.Options market data suggested a more positive view on the S&P 500, with institutional positioning for the index to hold above 520 through June 14 expiration. Upside room continued to open up in QQQ. For the small-cap Russell 2000, there was room left for a 2.4% rally this week, while expectations capped downside below 2.4% by June 21.Details:The $SPDR S&P 500 ETF Trust(SPY)$ saw open call interest decline -0.3% over the past 5 days. Open put contracts rose 0.6% over the same period.For call options, investors sold the most

Investors awaited this week's inflation report for clues on the Fed's policy path. Treasury yields and the U.S. dollar index declined.Options market data suggested the S&P 500 ETF could see a pullback of over 1.5% priced in by May 17 expiration. For QQQ, there was room left for a 2.2% rally this week, while a 4.2% decline was expected. The small-cap Russell 2000 had room for a 1.4% decline priced in for the week.Details:The $SPDR S&P 500 ETF Trust(SPY)$ saw open call interest decline -2.9% over the past 5 days. Open put contracts decreased -0.5% over the same period.For call options, investors bought the most $SPY 20241220 680.0 CALL$  with a 680 strike, adding 18,000 cont

Data showing a cooling jobs market revived hopes for Fed rate cuts later this year, boosting U.S. stocks. Home Depot and Caterpillar led the rally as the Dow notched its longest winning streak since December 2022 with 9 straight gains.Options market data suggested the S&P 500 ETF may have topped out around 521, with expectations for a decline of over 1.9% priced in by June 21 expiration. For QQQ, near-term upside was adjusted higher while longer-dated put buying continued. The small-cap Russell 2000 saw room for more upside into late May, with expectations capping gains in IWM below 6.8% by May 24.Details:The $SPDR S&P 500 ETF Trust(SPY)$ saw open call interest rise 2.3% over the past 5 days. Open put contracts increased 3.9% over the same

Rising Treasury yields and mixed corporate earnings impacted market sentiment, though the Dow Jones rose for the sixth straight session, reclaiming the 33,000 level.Options market data showed muted trading across the major index ETFs, with most activity concentrated in front-week options set to expire, suggesting retail traders were the main participants.Details:The $SPDR S&P 500 ETF Trust(SPY)$ options overall reflected a bullish trading sentiment, with sellers of put options dominating. Open call interest declined -1.4% over the past 5 days. Open put contracts increased 12.2% over the same period.For call options, the most actively traded was the $SPY 20240509 521.0 CALL$  w

Traders are looking for more clues on whether the Fed could start cutting rates. After a pullback in April, stocks have rebounded recently on renewed hopes for Fed rate cuts this year, with corporate earnings for the first quarter also providing some optimism so far.Options market data suggested the S&P 500 ETF may have topped out around 520, with any pullback limited to less than 4.8%. For QQQ, downside expectations continued to be tempered, with a decline of less than 2.2% priced in by June 21 expiration. Small-cap Russell 2000 looked to have topped as well, with expectations for the index to trade below 208 by mid-May.Details:The $SPDR S&P 500 ETF Trust(SPY)$ options overall reflected a bearish trading sentiment, with sellers of put opti

The surprisingly cool U.S. April jobs report stoked hopes for an earlier start to Fed rate cuts, sending the VIX fear gauge to a one-month low and pushing Treasury yields lower. Apple rallied nearly 6%, leading tech stocks higher.As the S&P 500 gradually rose, options market data showed continued adjustments to hedge put positions by raising strike prices. For QQQ, downside expectations for May were lowered, with a decline of less than 2.7% priced in by May 31st expiration. Small-cap Russell 2000 options saw active buying of calls, implying expectations for the index to trade above 205 by June 21.Details:The $SPDR S&P 500 ETF Trust(SPY)$ options overall reflected a bullish trading sentiment, with sellers of put options dominating. Open call

The surprisingly cooler U.S. April jobs report stoked hopes for an earlier start to Fed rate cuts, sending the VIX fear gauge to a one-month low and pushing Treasury yields lower. Apple rallied nearly 6%, leading tech stocks higher.Options market data suggested expectations for reduced volatility in the S&P 500 near-term, with a sideways bias this week and potential for the index to finish Friday below 509. QQQ saw continued buying of longer-dated downside protection. For small-caps, Russell 2000 options positioned for a range-bound move, with expectations for the index to trade between 194-210 into June.Details:The $SPDR S&P 500 ETF Trust(SPY)$ options overall reflected a bullish trading sentiment, with sellers of put options dominating. O