Unusual Options Activity in M, CCJ stock and PYPL

November 3, 2021

Unusual Options Activity Tankers 110221

Here’s what I learned in 25 years.

The stock market misses things… sometimes huge things.

And sometimes it takes a while to pan out.

But when it does… look out.

Think about the housing crash in 2009.

It was there for everyone to see. EVERYONE!

Remember the reports of people rushing to wait on line in Florida to buy a home with NO MONEY & NO INCOME VERIFICATION??!?!?!

They would buy the home to flip it a few minutes later to someone behind them on line for a profit.

I mean… it was right there in front of you. That couldn’t possibly end well.

Yet, for years nothing happened.

Now, think for a second...

China has been the world’s growth engine for the last 30 years.

When/if they pull back, do you think that won’t affect the WHOLE world?

Newsflash, China is pulling back (Here’s an article that relates it to dry-bulk/tanker shipping rates).

So what, Felix, the market is going up?

You’re right.

But remember what Leon Cooperman said (I paraphrase): “When this market eventually turns, the speed at which it goes down will make your head spin.”

I’m still looking for the odds of the SPY hitting $500 AND $400 in 6 months.

UNUSUAL OPTIONS ACTIVITY

1. A “Clean World” Likely Needs This

2. If You Like Saks, You Gott Love THIS Stock

3. Is there a Bottom to These Payment Names?

Let’s get started...


UNUSUAL OPTIONS ACTIVITY CCJ STOCK

A “Clean World” Likely Needs This

UOA Trade Idea CCJ 090221

CCJ is a name we have been long for a while. Our Target Stock Price was $27.50, which was hit today. But it looks like it may want more.

Better late than never, Bank of America upgraded the stock today saying:

“With tighter markets due to demand from the Sprott Physical Uranium Trust... and rising acceptance of nuclear’s potential role in decarbonizing, we expect rising term contracting activity in the near to medium term…  A growing term contract book should ultimately lead to a material improvement in profitability. Rising trends in both spot and long-term prices are likely to incentivize utilities to contract in the 5+ year time frame today, in order to mitigate the risk of contracting at much higher prices in the future.”

Uranium is looking like a better “clean” source of energy with every passing day.

The chart looks enticing even at these levels.

What Does the CCJ Stock Chart Say?

CCJ Chart - Options Activity 110321

CCJ stock is up 100% over the year.

The stock firmly above the 50 and 200dma. More importantly, the dips have held the 50dma.

While the bulls are in control, the bears might point out a little bit of a MACD diversion (dotted lines) and the lack of big volume today with this breakout.

As you would expect on a potential breakout, the options flows in CCJ stock are active again today.

Options Activity in CCJ Stock

Unusual Options Activity Scanner CCJ 110321

There’s unusual options activity in CCJ December options. This expiration is littered with significant open interest across most strikes between $21 and $36.

It appears like the $30 Calls are being bought in the event of a breakout spike. However, I could imagine selling stock here and replacing it with these exact calls.

The Risk-Reward Breakeven Price is $34.70 which seems like a big ask of the stock.

Just keep in mind that there should be a lot of risk-reward shuffling going on at these levels.


Stop Guessing - Mobile

UNUSUAL OPTIONS ACTIVITY M STOCK

If You Like Saks, You Gott Love THIS Stock

Unusual Options Activity M 110221

M is another name Winning Picks Premium Members are long that finally rammed through its $30 Target Stock Price. We’ve been long 6-month options since July looking for their online/digital story to get noticed.

The Saks announcement and Jana Partners has helped our cause:

“The thinking at Jana, according to a recent investor presentation, is that Macy’s e-commerce business could snag a market capitalization of at least $15 billion, or roughly twice what the combined company was worth before news started swirling about the potential break-up. Macy’s stock has rallied roughly 18% since Bloomberg first reported on Oct. 6 that Jana was calling for a digital spinoff.”

The stock is up but still could have a way to go.

What Does the M Stock Chart Say?

M Chart - Options Activity 110321

M stock has that “parabolic-thing” going on there where the curvature is in the right spot.

Bulls want to see it keep making new highs and holding previous highs.

Bears are looking for that blow-off top where it reverses quickly so they can pounce. They probably try to lean on it under $28.00-$28.50.

Options Activity in M Stock

Unusual Options Activity Scanner M 110321

Options are busy today. There is unusual options activity in M front-week Call options. The spike towards $32 this morning got traders excited. Unfortunately, for now many got caught reaching there.

I think the smarter play is to look at establishing a position for earnings so you can hear what the CEO says about the spin-off idea (if anything).

The M November 17th $30 Calls were bought 4,000 times for a little over $1.

Consider the same risk-reward adjustments here as you see in CCJ. This is the right spot to get out of stock and buy those calls for a possible larger move.


New Options Chain - Mobile

UNUSUAL OPTIONS ACTIVITY PYPL STOCK

Is there a Bottom to These Payment Names?

Unusual Options Activity PYPL 102121

Payment companies have been getting hit pretty hard in the last few months… especially PYPL.

Before the rumors about a PINS deal, PYPL was already down 10-15%. Since then the market has punished the stock almost another 20%.

Take a look.

What Does the PYPL Stock Chart Say?

PYPL Chart - Options Activity 110321

Like CCJ and M, the PYPL stock chart is experiencing some curvature.

Unfortunately, it’s upside down.

You can clearly see how much weaker a stock becomes under the 50dma.  Once it breaks the 200dma it becomes that much more dangerous.

The bears are in control here, but I suspect they are not pressing so hard on the gas down here.

Notice the differential between the stock price and the 50dma… It’s stretched pretty far.

The options flow is pointing to a bounce back.

Options Activity in PYPL Stock

Unusual Options Activity Scanner PYPL 110321

The unusual options activity in PYPL is centered around the front-week call options. Specifically, the buyers are looking at the November 5th $230 Calls. Over 11,000 have traded at a $1.50 average.

The Risk-Reward Breakeven Price is $234.91, which is quite a sharp move higher. It will clearly need Powell’s help today.

Earnings are expected on November 8th. I'd rather look at those options, but that's just me.

In general, I like the payment companies.

Yesterday, Winning Picks Premium Members bought options on a very cheap payment company that gets no love… of course, until someone decides it’s time to take it higher. Come and join us or at least check out what we’re doing.

Sign up for the Options Trading Newsletter via email and receive a FREE 7-day Options Course.

Now go make some money!

Best,
Felix

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