The SPY could be on track for its 3rd consecutive close below the 21 EMA and today’s session is not doing much to change that picture. We bounced off the lows near 761 and pushed toward 767 intraday, but the 8 EMA and 21 EMA are sitting right overhead at 766.71 and 768.34, and that spread is converging in a bearish way. Price is essentially pinned under both levels. Until we get a convincing close back above the 21 EMA, this tape is guilty until proven innocent.
Morning Flow Snapshot
The dominant theme in this morning’s flow is large-notional bullish positioning on broad market indexes, with two sizable SPX bullish risk reversals totaling over $215M in premium pointing toward upside into early 2027. XLF call buying and a big META bull call spread add to the risk-on lean. That said, there is a cluster of near-term bearish SPX risk reversals in the Dec26 expiry suggesting some traders are hedging or fading the bounce at current levels, so the picture is not clean on both sides.
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Top Setups
Nothing in today’s flow scored >= 70.
Some interesting trades today:
BHP
Big roll of a sold puts for BHP.
This is below the 200 day and this player is buying more time. This must have been a very painful trade to have been in to date. This is the kind of trade other people post as puts sold for Jan. That’s correct but you also need the other leg which is puts bought Nov. This is not fresh capital and it is a neutral trade - sure it continues to be bullish out of a trade that didn’t go very well from when it was first opened.
VSAT
This is one I like a lot.
Back above the 200 day and some nice bull flow so far this month.
SPCX
META
