To The Moon

Market Overview

The Nasdaq closed at a record high on Monday (May 20) while the S&P 500 gained slightly as technology stocks advanced ahead of Nvidia's highly anticipated earnings and investors gauged the timing of an interest rate cut by the Federal Reserve.

Regarding the options market, a total volume of 33,982,333 contracts was traded, down 22% from the previous trading day.

Top 10 Option Volumes

Top 10: $TSLA(TSLA)$, $AAPL(AAPL)$, $NVDA(NVDA)$, $AMC(AMC)$, $MARA(MARA)$, $AMD(AMD)$, $GME(GME)$, $AMZN(AMZN)$, $FFIE(FFIE)$, $HOOD(HOOD)$

Source: Tiger Trade App

Investors will look for evidence in $Nvidia(NVDA)$'s earnings that the AI chip leader can maintain its explosive growth and stay ahead of rivals. At least three brokerages lifted their Nvidia price targets ahead of results on Wednesday. The shares gained 2.5% on Monday.

There are 629.6K Nvidia option contracts traded on Monday, down 62% from the previous trading day. Call options account for 60% of overall option trades. Particularly high volume was seen for the $950 strike call option expiring May 24, with 26,507 contracts trading. NVDA 20240524 950.0 CALL

Source: Market Chameleon

Traders are pricing in a big move for Nvidia’s shares after the chipmaker reports earnings on Wednesday, though expectations for volatility are more muted than in the past, U.S. options markets show.

Nvidia's options are primed for an 8.7% swing in either direction by Friday, according to data from options analytics firm Trade Alert. That would translate to a market cap swing of $200 billion - larger than the market capitalization for about 90% of S&P 500 companies.

While massive by most measures, that implied move would fall far short of the 16.4% jump Nvidia’s shares notched after the company’s most recent quarterly earnings report. It is also less aggressive than the average 12% move traders had priced for the last eight quarters.

Reuters Graphics

Bitcoin advanced markedly on Monday in late afternoon trading, briefly topping $70K, leaving behind the subdued price action of the past few days. $Marathon Digital(MARA)$ shares jumped 14.8% on Monday.

There are 464.2K Marathon Digital option contracts traded on Monday, up 34% from the previous trading day. Call options account for 75% of overall option trades. Particularly high volume was seen for the $22 strike call option expiring May 24, with 19,164 contracts trading. MARA 20240524 22.0 CALL

Unusual Options Activity

Source: Market Chameleon

$Faraday Future(FFIE)$’s wild ride isn’t over yet. Shares leapt another 75% on Monday after an incredible end to last week.

There are 348.9K Faraday Future option contracts traded on Monday, down 76% from the previous trading day. Call options account for 66% of overall option trades. Particularly high volume was seen for the $2 strike call option expiring June 21, with 45,000 contracts trading. FFIE 20240621 2.0 CALL

Gold and silver exchange-traded funds gained on Monday as the underlying metals surged to new highs. The $iShares Silver Trust(SLV)$ (SLV), with $12.4 billion in assets, gained 0.7% on the day and are up 33% since the start of the year as retail investors look for diversification.

There are 819.5K SLV option contracts traded on Monday, down 7% from the previous trading day. Call options account for 69% of overall option trades. Particularly high volume was seen for the $23 strike put option expiring July 19, with 26,800 contracts trading. SLV 20240719 23.0 PUT

Movie theater company $AMC Entertainment(AMC)$ saw shares jumped almost 10% on Monday, which comes in the wake of meme stocks being highly volatile last week. While AMC shares have been volatile with meme stocks, the move could be related to a theatrical event. Last week, AMC hosted an exclusive "Listening Event" for Eilish's newly released album "Hit Me Hard and Soft." The partnership was announced during AMC's recent first-quarter financial results.

There are 470.7K AMC option contracts traded on Monday, down 39% from the previous trading day. Call options account for 75% of overall option trades. Particularly high volume was seen for the $5 strike call option expiring May 24, with 45,413 contracts trading. AMC 20240524 5.0 CALL

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.

Based on option delta volume, traders sold a net equivalent of -2,203,760 shares of Apple stock. The largest bearish delta came from selling calls. The largest delta volume came from the 24-May-24 192.5 Call, with traders getting short 2,386,968 deltas on the single option contract. AAPL 20240524 192.5 CALL

Top 10 bullish stocks: $UAA(UAA)$, $AMC(AMC)$, $GME(GME)$, $MARA(MARA)$, $FFIE(FFIE)$, $BNED(BNED)$, $SNAP(SNAP)$, $CPRI(CPRI)$, $HOOD(HOOD)$, $MRNA(MRNA)$

Source: Market Chameleon

Top 10 bearish stocks: $AAPL(AAPL)$, $TLRY(TLRY)$, $DJT(DJT)$, $SBUX(SBUX)$, $UEC(UEC)$, $RIG(RIG)$, $AMD(AMD)$, $BB(BB)$, $NCLH(NCLH)$; $TSLA(TSLA)$

Source: Market Chameleon

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