Weekly OFR (Option Flow Report)

The OFR — Option Flow Report

By Chris Capre, Head of BOS / TW / 2ST

(Do not forward)

Welcome to a new trading week!

The Week in Review

SPY:

SPY closed another week bearish with most of the losses on Weds, particularly aftermarket when TSLA/GOOGL posted earnings. While GOOGL beat, TSLA was mixed (missing on EPS) and both sold off with TSLA shedding -15% in market cap since and GOOGL -6% since. This was not the start to earnings season traders had expected, and with the conflict in the ME (Middle East) continuing, oil rising and bond yields climbing, SPY lost -1.06% on the week.

QQQ:

QQQ’s (as predicted) had much greater volatility vs SPY last week and we think that continues this week. Considering the Mag7 earnings from GOOGL/TSLA hurt overall markets, it hammered the tech index even more. QQQ closed down -2.55% and on the weekly chart is in danger of rolling over and losing the sideways corrective structure its maintained since May 11^th. A close this week < 684 would start to break that corrective structure and likely trigger some technical stops.

• We begin this week as one of the most packed macro calendars of the year with big tech/Mag7 earnings front and center with MSFT/META on Weds (aftermarket), AMZN/AAPL on Thurs (aftermarket) along with more AI tickers (ARM/LRCX) on deck and more coming next week.

• All of the above tech earnings are hitting with an FOMC squarely in the middle, and with the FED giving less forward guidance, we lean towards FOMC events becoming more volatile, especially with futures markets pricing in a rate cut by Sep or Oct, and definitely one later this year.