TLDR;
This YouTube video from StockedUp discusses the current state of the stock market, highlighting the divergence between retail investors and major asset managers in terms of cash positions. It also previews key market-moving events, including the upcoming Federal Reserve announcement and triple witching week. The video identifies potential trading setups in stocks like RKLB, DAL, UMAC, SNDK, and WDC, and analyzes a large options trade in Shopify (SHOP), providing insights into potential price movements and trading strategies.
- Individual investors are holding less cash, while major asset managers are increasing their cash positions, a pattern seen before market drops.
- The market awaits the Federal Reserve's announcement and faces a triple witching week, both of which could increase volatility.
- Several stocks, including RKLB, DAL, UMAC, SNDK, and WDC, are highlighted for potential trading opportunities based on recent price action and news.
Big Implications for Tomorrow [0:00]
The stock market is currently stuck, but upcoming events could change that. Individual investors are holding less cash, with positions falling to 14.19% in February, while major global asset managers are increasing their cash positions at the fastest rate since the COVID pandemic, reaching 4.3% of portfolios managing over $529 billion in assets. This pattern has historically preceded large drops in the stock market. Fund managers are building cash positions due to fears surrounding the war and turmoil in the private credit market, raising uncertainty.
The market is awaiting the Federal Reserve's announcement, the first since the war began, where the focus will be on future actions amid concerns about oil prices and inflation. The odds of a rate hike in the next three months are now higher than a cut, a significant shift from a month ago. The SPY is currently 4.11% away from all-time highs and is trading in a chop zone between 662 and 683-684. The average market drawdown over the past 75 years has been 14%, while this year's is only 5%, suggesting potential for further decline. This week is also a triple witching week, which can cause high trading volume and sharp price swings. The SEC is considering a proposal to allow companies to report earnings twice a year instead of quarterly, which could lead to bigger earnings moves. Micron (MU) will report earnings after hours, along with Redcat (RCAT), with other reports from Baba (BABA) and FedEx (FDX) also expected this week.
Favorite Setups & Predictions [6:04]
Rocket Lab (RKLB) is on the bullish radar due to talk of a SpaceX IPO and the FAA confirming that major operators, including Rocket Lab, have moved to the part 450 streamlined rule, which simplifies licensing. Despite a $1 billion offering causing a slight after-hours dip, the stock's bullish price action is being monitored. Delta Airlines (DAL) and other airlines are being watched closely after raising revenue guidance for the first quarter, despite rising jet fuel costs. Delta's CEO stated that growth in demand is offsetting the rising costs. A breakout above the $66 to $66.25 sell walls could lead to a run up to $70.
UMAC, which services the American drone industry, is also on the bullish radar after a 12% increase. SanDisk (SNDK) and Western Digital (WDC) are being monitored as memory chip players continue to rise. SNDK is testing all-time highs and could see more momentum if it holds above that level. Space Mobile (ASTS) and Uranium Energy Corp (UEC) are momentum plays to the upside, while Cleveland Cliffs (CLF) is a momentum play to the downside. A $1.49 million trade in Shopify (SHOP) 130 strike call options expiring in September 2026 is analyzed, noting Shopify's positioning as the backbone of AI agents for product discovery and checkout. The options are at the money and have time, but are expensive. Shopify is in a clear uptrend and bouncing off a huge zone of support, with potential to reach $150 to $160 if AI commerce picks up.
