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Opinion: The bulls may lose enthusiasm for the stock, but these three potential buyout plays could land them in the money

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The US stock market, according to the S&P 500 Index SPX,
-0.97%And
It finally broke through the triple resistance at 4100, on February 1st. But the S&P 500 had trouble adding this breakout. Instead, the market has pulled back and has now retested the support at 4100 several times this week. So far, this support has held, but some overbought conditions and even sell signals had time to show themselves while SPX stalled in this area.

If the support at 4100 fades, that would be a psychologically disappointing event, likely to push the SPX down towards the lower end of its previous trading range – near 3800. On the upside, the initial breakout hit 4200, which was equal to late August levels. SPX has not closed a gap on its chart from that August time period (circled on accompanying SPX chart).

the gathering It managed to cross +4σ “adjusted Bollinger Band (mBB)”. Then, when the SPX fell below the +3σ range, a “classic” mBB sell signal was generated. Since the SPX fell further the next day, a complete sell signal of the McMillan Volatility Range (MVB) (green “S” on the chart) was confirmed. This would remain in effect until SPX either a) touches the -4σ band, which is the “target”, or b) closes again above the +4σ band, which would stop the trade.

Stock-only ratios continue to decline at a rapid pace. Thus, both are still on buy signals. They have now fallen to levels close to where the sell signals were generated last year. However, we do not use the previous levels as indicators for these overbought ratios. Instead, they will remain in an uptrend for stocks as long as they continue to fall – no matter how low they go on their charts. They will not generate sell signals until they roll over and start to go higher.

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The breadth was amazing for over a month. But this recent back-and-forth by the market, with several steep down days, has taken its toll. For the time being, both amplitude oscillators are still working on buy signals, but they have run out of “fluctuation” space. That is, any further negative build-up of supply from today onwards will generate sell signals from the supply oscillators.

New NYSE 52-week highs remain strong (reaching over 200 in one recent day), while 52-week lows remain in the single digits. Therefore, this indicator remains positive for stocks. The uptrend will continue unless the number of new lows outweighs the new highs of two consecutive days on the New York Stock Exchange.

The overall volatility composite remains bullish for the stock market as well. VIX VIX,
+6.16%
Remained at lower levels, despite some relatively heavy selling at times by SPX. Thus, the direction of the VIX buy signal remains valid (it started at the crossover inside the green circle on the accompanying VIX chart). The first sign of concern could be if the VIX should re-enter a “surge” mode – ie if it closes at least 3.00 pips higher over any one, two or three day period. Currently, the VIX must close above 21.48 today or Friday in order to re-enter the “spiking” mode. However, no recent signs of such an upward move have been shown.

The formation of volatile derivatives is also bullish for stocks – mostly. The only ‘concern’ in the build is that the short-term 9-day CBOE Volatility Index (VIX9D) is above the VIX. That’s because the CPI figures are due to be released this month on February 14thy, and that during a 9-day “window” for the VIX9D. Traders expect the CPI number to introduce some (more) volatility in stock prices.

We no longer hold a “fundamental” bearish position since the SPX rose above the downtrend line of the market. We will trade both the long and the short sides, though, as the sure signals from our indicators dictate.

New recommendation: MVB sell signal

Since a new MVB sell signal is generated, we will add a position in line with this indicator:

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Buy 1 SPY Mar (17) when the money is off

And sell 1 SPY Mar (17) at a price 25 pips lower.

This trade will be stopped if SPX is stopped Close Again above the +4σ band. We’ll keep you updated on the gang’s situation every week.

New Recommendation: Catalent Inc. (CTLT)

option size in Catalent CTLT,
+0.32%
It stayed elevated for several days, after if a loophole was first lifted higher on the news of a possible Danaher DHR acquisition,
-2.44%.
This rumor has slowed down a bit, but the stock is holding at levels above 70. Stock volume patterns are positive, and there are also buy-to-buy ratio buy signals in this stock. Because of price gaps, there is no visible support level until you get back to 58.

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Buy 2 CTLT Mar(17y) 70 calls

At 6 or less.

CTLT: 71.60 March (17.60y) 70 call: 5.50 bid at 6.20

Follow the movement:

All breakpoints are mental breakpoints unless otherwise noted.

We use a “standard” trading procedure for our SPY spread: In any vertical bull or bear spread, if the underlying hits the short strike, roll the entire spread. That would be a roll higher In the event of a bull call spread or roll under In the event of a bear outbreak. Stay at the same expiration, and keep the distance between strikes the same unless otherwise instructed.

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Long 2 PCAR 1 Feb (17y) 64.80 puts: Packar PCAR
+1.45%
hash 3 vs. 2 on February 8th. Thus, the “shares per option” was increased from $100 a share to $150 a share, and the staggering price was reduced by two-thirds. The Buy-Buy ratio carried over after a strong earnings report from PCAR. The options are essentially worthless, so we’ll hold onto them to see if the stock can pull some of them away.

Long calls 2 OSH Feb (17) 30: Oak Street Health OSH,
+0.40%
Received a $39 takeover offer from CVS Health. CVS,
+1.16%.
The stock is trading well below that level, apparently due to antitrust concerns, so we’ll exit and take a profit. Don’t sell your calls for less than par.

Long 1 SPY Feb (24y412 Call and Short 1 SPY Feb (24y) 426 calls: This spread was bought when the break above 3940 was confirmed by SPX, at the close on January 12thy. It came out on February 1, when Spy Spy,
-0.96%
Trade at 412.

Long 1 SPY Feb (17y) 404 call and Short 1 SPY Feb (17y) 419 calls: This spread is bought in line with the “new highs vs new lows” buy signals. It was brought up on January 26, when SPY was trading at 404. Stop yourself from this position if NYSE’s new lower lows exceed new highs for two consecutive days.

Long 4 NATI Feb (17y) 55 calls: NATI National Instruments contract,
-0.32%
Non-stop at first, to see if the bidding war will develop.

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Long 1 SPY Mar (17y(415 call and Short 1 SPY Mar (17y) 431 connection: This trade was established as a “breakout trade” when SPX closed above 4100. Stop yourself on a close below 4020 by SPX.

Long 3 XM Mar (17y) 15 calls: Continue to hold Qualtrics International XM,
-0.98%
While takeover rumors break out.

Send questions to: lmcmillan@optionstrategist.com.

Lawrence G. McMillan is the President of McMillan Analysis, a registered investment and commodity trading advisor. McMillan may hold positions in securities recommended in this report, either personally or in client accounts. He is an experienced trader, money manager, and author of the best-selling book, Options as Strategic Investing. www.optionstrategist.com

© McMillan Analysis Corporation is registered with the Securities and Exchange Commission as an investment advisor and the CFTC as a commodity trading advisor. The information in this newsletter has been carefully compiled from sources believed to be reliable, but accuracy and completeness are not guaranteed. Officers or directors of McMillan Analysis Corporation or accounts managed by such persons may have positions in securities recommended in the advisory.

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Rast’s accusations against Alec Baldwin were formally dismissed by Reuters

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© Reuters. FILE PHOTO: A view of the movie “Rust” playing at Bonanza Creek Ranch near Santa Fe, New Mexico, US January 20, 2023. REUTERS/Drone Base/File Photo

Written by Andrew Hay

TAOOS, New Mexico (Reuters) – Special prosecutors in New Mexico on Friday dropped charges against actor Alec Baldwin in the 2021 shooting of “Rust” cinematographer Halina Hutchins, referring to what many legal analysts described as a rationale for a prosecution. flawed jurisprudence.

A person close to prosecutors said the move followed new evidence of the gun Baldwin was carrying when he fired the shot that killed Hutchins while shooting the movie in Santa Fe, New Mexico.

This information undermined the prosecution’s case after a series of legal flops, leading them to dismiss the charges before a May hearing when a judge was to decide whether there was enough evidence to prosecute Baldwin and gunsmith “Rust” Hannah Gutierrez Reid.

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“The case was dismissed without bias and the investigation is active and ongoing,” prosecutors Carey Morrissey and Jason Lewis said in a memo.

Prosecutors went on to charge Gutierrez Reed, 25, with manslaughter. She has said she held the live round in the gun thinking it was a dummy round. The preliminary hearing in her case has been postponed to August 9.

The dismissal of the same charge against Baldwin came after his attorney presented evidence last week that the copy of the .45 Colt Baldwin has used has been modified with new parts since being manufactured by Italian gunsmith FLL Pietta.

The information compromised the prosecution’s argument that the gun was in fully working condition and could only fire if Baldwin recklessly pulled the trigger, according to the person familiar with the case.

Special prosecutors have said they may re-file charges against Baldwin once new evidence is examined, though legal experts are skeptical.

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“This very weak case against Baldwin should never have been brought in the first place,” said Ambrosio Rodriguez, a former district attorney with the District Attorney’s Office in Riverside County, California.

Filming for “Rust” resumed in Montana this week with many of the same lead actors, including Baldwin, and was expected to wrap up in May.

Rust Movie Productions (RMP) said in February that it would not resume filming in New Mexico, without giving a reason. A Santa Fe prosecutor charged Baldwin and others in January.

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Leading news reporter Jill Christian dies at 83

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Gail Christian, who broke barriers as a black on-air reporter and came to national prominence at NBC News and PBS, died April 12 in Los Angeles. She was 83 years old.

Her wife, Lucy Debardelapine, said it was a complication from a recent bowel surgery.

Christian overcame a troubled youth—including a prison term for armed robbery—to end a career as a prominent television journalist and news executive in the 1970s and 1980s, an era when the industry was dominated by white men.

It became a visible presence in American living rooms with it coverage to NBC News on the trial of Patricia Hearst, the newspaper heiress who was kidnapped in 1974 by a gang of left-wing revolutionaries called the Symbionese Liberation Army, and who was convicted two years later for participating in a bank robbery with the group.

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But for Ms. Christian, it wasn’t enough just to appear as a rare black face on the evening news.

She said in Interview with the Chicago Tribune In 1986. I felt that was the reason I was there. I didn’t resent it in the least. I felt then, as I feel now, that it is very dangerous for a group of people to live in a society in which they are not allowed to explain themselves.”

It has succeeded in this task with features like “A Country Called Watts”, An hour-long 1977 NBC News special that explored the efforts of residents of this Los Angeles neighborhood to come together and re-evaluate the bloody civil unrest that occurred in response to police brutality in 1965, rebuilding burned-out blocks in the face of perceived government indifference and continued police harassment.

Gary Gilson, former faculty director of a summer program for minority students at Columbia University’s Graduate School of Journalism, in a phone interview. “And her pioneering role as a black news reporter allowed black kids to see, many for the first time, an impressive person on television who looked like them. It gave them recognition and hope.”

After two years at NBC News, Ms. Christian became news director for public station KCET in her hometown of Los Angeles, where she created a “60 Minutes”-style investigative series called “28 Tonight” (the station was on channel 28).

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The program featured several award-winning segments, including a segment on a banking scandal that harmed low-income communities and another on a chemical spill in Orange County that caused illnesses in the area, each of which won a Peabody Award.

In 1981 she moved to Washington, where she began nearly a decade as the news director for the Public Broadcasting Service.

“Since I’ve been in the business, I’ve always wanted to be one of the officers who goes out in that little room and decides what’s going to be covered and who’s going to cover it,” she said in a 1976 interview with the Los Angeles Times. “But at NBC, I never saw any women walk into that little room. Nor any minorities. I thought this was my chance.”

She added, “As Bobby Seale said,” referring to one of the founders of the Black Panther Party, “take the time.”

Jill Christian Jill Patricia Wells was born on February 20, 1940, in Los Angeles, one of four children of Edwin Wells, who worked on an assembly line for the Hughes Aircraft Company, and Lucille (Scruggs) Wells, who owned a cosmetology college. In the Leimert Park neighborhood of South Central Los Angeles. (She later adopted Christian, a name from her mother’s family, as her professional surname.)

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Ms. Christian grew up in Venice, California, and spent three years studying world history at California State University, Los Angeles, before dropping out to join the Air Force in 1962. She was caught in a raging crowd after being discharged, and in 1965, was found guilty of Armed robbery after eroticism in a hotel.

The theft, which resulted in less than $100, led to her admission to the California Institute for Women in Chino for 18 months. Christian said in a 1976 interview with TV Guide. “I really didn’t need to do that. I had a loving family, unlike a lot of the others in prison. I was just kind of pushed out at the time.”

After she had served her time, a paroled colleague who was working as a switchboard operator at The San Francisco Examiner gave her a tip that the paper was planning to hire two black reporters to diversify its staff. Without any experience, Ms. Christian considered the opportunity far-reaching, but talked her way into the role of an apprentice by stretching the truth.

“I gave them this song and they danced around working on this little black paper that the Klan burned,” she told the Tribune.

In 1970, she participated in an 11-week summer program for minority students in broadcast journalism at Columbia. (Geraldo Rivera was a classmate.) Two years later, she was hired by local NBC affiliate KNBC. She worked there for six years before NBC News hired her.

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Her tenure at PBS ended in 1989, shortly after the network found itself embroiled in controversy over the airing of a pro-Palestinian documentary, Days of Rage, which Ms. Christian had acquired and was responsible for vetting. A news report confirmed that the film was partially supported by undisclosed Arab funding, which was denied by the film’s producer.

In an interview with The New York Times, Ms. Christian said she quit PBS for other reasons. She said, “You’re burning because this is a no-win situation.” “You are silent when things are going well and angry when there are questions.”

She eventually settled in Palm Springs, California, with Mrs. DeBardelaben, whom she married in 2016. In 2003, the couple started the Palm Springs Women’s Jazz Festival.

In addition to Mrs. DeBardelaben, Mrs. Christian is survived by her grandson. Her daughter, Sunday Barrett, died in 2019.

While Ms. Christian kept quiet about her prison term early in her career, she finally decided to divulge it to a sympathetic NBC executive. “The guy just looked at me,” she recalls. He says: I don’t have enough problems. Do I have to listen to you? Get outta here.’ I didn’t hear another word.”

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Economic mood and other investment stories you may have missed this week

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This week has been a tough bullish one. Here’s what investors saw:

  • Oil prices have given up most of the gains from the OPEC+ production cut.

  • The Philadelphia Fed Manufacturing Index hit a new low for this economic cycle and missed expectations. Other indicators from the Conference Board The leading economic indicator I also fell.

  • Initial jobless claims were a surprise to the upside for the fourth consecutive week.

  • Weak earnings and more caution emerged from freight operators JB Hunt and Union Pacific as well as auto retailer AutoNation. Netflix and Taiwan Semiconductor, a major supplier to Apple, also issued guidance warnings.

  • There have been more layoffs in Meta’s Cloroxwith reports of planned job cuts at Disney.

  • Tesla reported a quarterly gross margin loss recently price cuts.

The bottom line is that there is an ongoing negative shift in economic data, most likely as interest rates continue to rise in the economy. This is a red flag.

Oddly enough, however, investors can’t seem to jump into it judging by the resilience of the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average.

“The latest data is further evidence that there will be a recession in the US soon, which fits with our own view at DB Research that it is expected to happen later in the year,” Jim Reed, Deutsche Bank strategist wrote in the client note.

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Good words of wisdom now.

Tesla CEO Elon Musk speaks to a visitor as he arrives to look at the Tesla Gigafactory construction on September 3, 2020, near Gruenheide, Germany. (Photo by Maja Hitij/Getty Images)

3 things you might have missed

1. The mood among AmEx cardholders: I met with American Express CEO Stephen Squarey, and he struck an optimistic tone about order trends.

“The economy is definitely divided, and I think at the lower end of the economy, we’re seeing some pressure, but we don’t have that,” Squirey said, adding that he sees strong demand for travel in the spring and summer. The call to travel lines up with what we’ve heard about this earnings season from Delta and United Airlines.

2. Elon Musk is following the storm. An interesting highlight from Tesla’s earnings call was when Elon Musk said he didn’t see the economy improving until 2024. The CEO predicted another year of “stormy economic weather” before “things start to get sunny in the spring of next year.”

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Musk joins the likes of JPMorgan CEO Jamie Dimon in using weather to describe the economic outlook.

3. About this credit cost: In an exclusive on Yahoo Finance Live, Loretta Mester, President of the Federal Reserve Bank of Cleveland, tells Jane Schoneberger that there is only one direction for interest rates in the near term: higher.

“I think that, given the complexity of inflation, and given the still-strong job market, I think rates should go above the 5% level,” Mester said.

Loretta J.  Jim Urquhart

Loretta J. Jim Urquhart

C-Suite, quote of the week

“We are not seeing a significant drop in trade [among consumers]John Mueller, CEO of Procter & Gamble (PG) told Yahoo Finance Live. We are witnessing, if anything, more careful use of the product they purchased. So they might use half a sheet of a Bounty paper towel instead of a full sheet. But overall, again, just looking at the numbers, the consumer holds up very well.”

planner of the week

For those investors who are ignoring the dangers of the impending debt ceiling, here’s a helpful reminder from the macroeconomics team at Goldman Sachs on how markets will price in the 2011 debt ceiling debate:

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Remember the debt ceiling debacle of 2011?

Remember the debt ceiling debacle of 2011?

Brian Suzy He is the Executive Editor of Yahoo Finance. Follow Suzy on Twitter @tweet and on linkedin. Deal tips, mergers, activist positions, or anything else? Email brian.sozzi@yahoofinance.com

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