Really not sure what to expect, but the level of bearishness combined with a few gigantic stock splits (AMZN splits Monday 6/6, GOOGL 7/15, and SHOP 6/22) could propel the marketing into the 4400 range. I believe that would be the MAXIMUM pain for bears, then continue down.
Reasons for my bullish short tern outlook.
1. AMZN stock spilt on 6/6 2. Incredible amount of PUTS across the bored leading to a sense of over hedging 3. TTM Squeeze on SPX daily looks primed to rip towards the upside 4. WeBull comments section is super bearish. lol
I really wish these young investors would stop chasing the quick buck. I can't help but feel like they are prolonging the inevitable correction if not causing a big crash. Most of these analyst on TV have no clue about 401K's or portfolio protection. Nearly all of them are individual stock pickers vs. macro economic market analyst. Then there is our lovely administration and pathetic Powell. No wonder these young investors are oblivious to the pitfalls of the markets. It's always been retail investor vs. "the machine" (financial Institutions) . Currently, it seems that the "MACHINE" is selling into every one of these rallies. And that algorithm/methodology/triggers, etc. will not change until we have a full scale wash-out/panic selling with confirmation (meaning not only did we break support but traded several days under that support level). Possibly when that young investor gives up.
mjcpaull
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stock splits won't make any difference
Turkish_007
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@mjcpaull, not from a market cap standpoint no. From a liquidity and options trading standpoint it absolutely will.
orange369
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hmm... technically, stock split should have zero impact on a stock value, zero. option traders are to gain only. until yesterday 1 option contract (100 shares per contract)= $244,700. starting next week 1 option contract= $12,235.
the other day, a CNBC commentator/trader said he bought amzn stock a week ago so he can sell it this coming week to retail investors. retail investors deserve the title "dumb money". amzn is 20% up in a week. I hope retail investors (I'm one too) are not that dumb.
next bigger move is likely down back to around 3800.
Turkish_007
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@orange369, you're not incorrect. Stock spilt from a technical standpoint won't have a direct effect on the underlying market cap. The lower price should bring in more liquidity, especially in options since the cheapest 7DTE option within +1 ATR won't cost 2k for one contact. Concentrators like that on CNBC deserved to get burned truthfully. That's a garbage thing to say, even though he's not wrong. Competing a larger rising wedge like this could also put more powder into the next downside move. Who knows 😂
Turkish_007
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@orange369, also you're option pricing is way off. An option around $23 would be 2.3k. Unless you're referring to the actual intrinsic value of the stocks the option allows you to buy, not the actual cost for 1 contact. Also, only 7% of ITM options at expiry actually get exercised.
orange369
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@Turkish_007, you're correct.contract notional value and option contract price are two different things. this is a stock market not politics, "garbage thing to say" is not applicable.
Turkish_007
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@orange369, I disagree. Calling retail traders stupid and trying to rob them blind is absolutely a garbage thing to say.
orange369
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@Turkish_007, Unfortunatelly their actions confirm the narrative.