by Eli, Zoe
Big end of the month rebalancing day on last Friday, it surprisingly went quiet for most of the session but made up for it in the final hour of the day.
The overall flow was quiet as a whole on the day but there was some selective buying out there, most of it coming in the morning, repeat institutional sweeping showed up in re-opening play $e.l.f. Beauty Inc(ELF.US)$ again, not the most ideal spot coming off its recent lift but certainly can have further upside, maybe just needs to hang around a bit if the overall market is not all that accommodating. $Alcoa Inc(AA.US)$, $Cameco Corp(CCJ.US)$, $TripAdvisor Inc(TRIP.US)$ all fit the rotation playbook, saw repeat buying once again at higher levels. $Unity Software Inc(U.US)$ a high growth name we would love to see some real buying at these levels, saw a little bullish positioning in a small put seller and call sweepers.
Although there was some activity out there Friday, nothing exciting enough to get jumping out of our chairs to build a position in. The top order flow on the week was the June call accumulation in $MasterCard Inc(MA.US)$ which is exactly the type of accumulation we want to see at this point, the stock is also working on a monster breakout after doing nothing for months.
On the sentiment front
The short-term sentiment remains on a bullish signal. We actually did get a squeeze last Friday, a couple of them but thanks to end-of-month rebalancing, a $2B market on close sell led to a nasty fade into the bell. The intermediate-term sentiment with some work still to do leaves the window open for some further selling or volatility, even if we do see more of a squeeze comes first.
You see, for the first time since the COVID bottom, the market once again is backing the Fed into a corner. Now, we hear all day that higher rates are good for certain sectors and bad for others but we all know when the bad stuff gets out of hand, it will likely weigh on the good stuff as players need to raise cash.
Notable bettings toward broader market indices ETF on 2/26
Market-wide option volume of 47.0m contracts was 6% above recent average levels, with calls leading puts 7 to 5. ETF and Index products saw relatively heavy volume, while single stock flow was moderate.
Individuals breakdown by sectors (2/26 notable bets)
Most active sectors included Telecommunications, Financials and Consumer Cyclicals while Energy and Health Care were relatively light. Of the 3,807 stocks with listed options, 1,334 (35%) closed higher, and 2,387 (63%) lower. Among the 500 most liquid single stocks, 30day implied volatility was lower for 338 and higher for 107. Unusual total option volume was observed in $AT&T Inc(T.US)$, $Rocket Companies Inc(RKT.US)$, $FISKER INC.(FSR.US)$, $SOS Ltd(SOS.US)$ and $Salesforce.com Inc(CRM.US)$.
Tech
Industrial
Consumer Cyclical
Financial
Communication Services
Healthcare
Energy
Real Estate
Basic materials
Consumer Defensive
Utilities
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