Option Movers | This Audio AI Specialist's Call Options Skyrocket 600% ; Negative Sentiment on Tesla May Overdone
The S&P 500 and Nasdaq edged lower on Wednesday (Mar. 13th) as investors took profits in chipmaker stocks, while they braced for producer price data and further clues on the inflation trend ahead of next week's Federal Reserve meeting.
Regarding the options market, a total volume of 42,158,732 contracts was traded on Wednesday.
Top 10 Option Volumes
Top 10: $SPY(SPY)$; $QQQ(QQQ)$; $TSLA(TSLA)$; $SPX(SPX)$; $NVDA(NVDA)$; $AAPL(AAPL)$; $VIX(VIX)$; $IWM(IWM)$; $AMD(AMD)$; $KWEB(KWEB)$
Source: Tiger Trade App
$Tesla(TSLA)$ shares fell 4.54% to $169.48 on Wednesday after Wells Fargo raised concerns over the waning impact of price cuts by the world's most valuable automaker on the demand for its electric vehicles and downgraded them to "underweight".
The brokerage also slashed Tesla's price target to $120 from $200, which is one of the lowest on Wall Street and implies a 32% downside to stock's last closing price.
A total number of 2.95 million options related to Tesla was traded on Wednesday, of which 62% were put options. A particularly high trading volume was seen for the $170 strike put option, with a total number of 233,918 options trading as of Mar. 13th.
Source: Market Chameleon
However, Wedbush analysts said Wednesday they believe the negative sentiment surrounding Tesla stock is “way overdone.”
The team pointed out that Tesla remains on track to surpass the production and sales milestone of 2 million units in 2024. Moreover, achieving a range of 2.1 million (base case) to 2.2 million (stretch goal) units is still considered feasible, despite a softer performance in the first quarter, with projections now leaning towards the 430,000 units mark.
Unusual Options Activity
Source: Market Chameleon
Audio AI specialist $SoundHound AI(SOUN)$ surged 24.82% to $8.65 on Wednesday. The stock has gained 308% so far this year.
While there are a host of major players developing AI-powered voice assistants, SoundHound AI is fetching the majority of media coverage thanks to its relationship with Nvidia.
Speech recognition has many different use cases. SoundHound AI's technology is primarily used in vehicles, restaurants, and smart home appliances. With a customer roster that includes Qualcomm, Toast, $Block(SQ)$, and Hyundai, SoundHound AI has proven that it can attract some of the world's leading brands.
A total number of 387,610 options related to SOUN was traded, of which 80% were call options. Market sentiment for SOUN was quite bullish as of Mar 13. Based on option delta volume, traders bought a net equivalent of 6,617,260 shares of stock. A particularly high trading volume was seen for the $8 strike call option, the contract surged 600% with SOUN shares surging nearly 25%.
Source: Market Chameleon
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: $SOUN(SOUN)$; $NYCB(NYCB)$; $CCJ(CCJ)$; $GOGO(GOGO)$; $AMD(AMD)$; $C(C)$; $GOTU(GOTU)$; $X(X)$; $RIOT(RIOT)$; $PATH(PATH)$
Top 10 bearish stocks: $WMT(WMT)$; $AAPL(AAPL)$; $DVN(DVN)$; $CVE(CVE)$; $KO(KO)$; $YMM(YMM)$; $CCL(CCL)$; $RIVN(RIVN)$; $HPE(HPE)$; $M(M)$
Source: Market Chameleon
Based on option delta volume, traders sold a net equivalent of -6,041,354 shares of $Walmart(WMT)$ stock. The largest bearish delta came from selling calls. The largest delta volume came from the 15-Mar-24 58.33 Call, with traders getting short 6,675,895 deltas on the single option contract.
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