Deciphering the Large Bullish Activity in a Global Oil Giant

[Option Beast]( 05/22/2021   |   [View in browser]( --------------------------------------------------------------- [Deciphering the Large Bullish Activity in a Global Oil Giant]( Someone is targeting a breakout in oil giant BP with a carefully crafted options strategy. Transactions occurred simultaneously around 12 p.m. ET in the July 23 puts and the July 29 calls. Large blocks of similar size occurred at the same time, spaced out over 20 minutes. All told, the investor bought about 35,000 July 29 calls for $0.66. They sold a matching number of July 23 puts for $0.26, resulting in a cost of $0.40 per contract. Calls fix the price where investors can purchase a stock. They tend to appreciate when shares rally. Puts are usually bearish because they establish a minimum exit. However, they are neutral/bullish when they sold like yesterday because the trader hopes BP will remain above a certain level. What's it mean? First, realize this is a potentially risky strategy because it involves selling naked puts. But there seems to be some interesting logic in the trade... [More...]( SPONSORED CONTENT ["Boring Trade" Generates $185 Every Day. Like Clockwork]( Forget cryptos, pot stocks, and other "shiny object" investments. Instead, you could collect an average of $185 every day of the year with this "boring" trade strategy Forbes magazine says is "like finding money in the street." [For full details, click here.]( [REFLECTIONS... by David Sager](#) Inflation is heating up and it could impact the bustling economy. Inflation evidently is what's bothering respondents, who looked for prices to rise 4.6% in the coming year, a sharp rise from their expectation of 3.4% a month earlier. The last time anticipated inflation was higher was in August 2008, when gasoline topped $4 a gallon in much of the U.S. The Investors today are looking for some insurance in case JeromePowell & Co. miss their mark (overshooting the 2% mark). The main spur for inflation, actual and expected, has been the extraordinary U.S. fiscal stimulus, effectively underwritten by the Fed's 'ultra' easy monetary policy. But after the $1.9 trillion American Rescue Plan that gave Amereicans $!,400 in free money, the outlook for the Biden Administration's wish list of over $4 trillion in further spending is increasingly questionable. The odds for a major tax hike are worsening, which would be good news for the financial markets according to Greg Valliere, chief U.S. strategist for AGF Investments. Moreover, a "bipartisan deal is in sight on an infrastructure bill," he writes in a client note.. The President could "grudgingly accept something slightly north of $1 triullion," plan, but far more than Republicans' $568 billion propiosal, with no new taxes. Biden appears to be channeling Ronald Reagan, Valliere adds, accepting what he can get before coming back for more. Maybe he can win this one for the Gipper? The stock market ended the week on a high note Friday, despite disappointing data on retail sales before the open. The Nasdaq Composite finished the week churning up and down all sessions, losing 2.3%, still below its 50-day moving average. Even the high techs were fickle, never settling down on the positive, April retail sales were somewhat flat versus views for a 1% gain. But March data was revised higher to 10.7% versus an initial reading of 9.8%. The data comes after hotter-than-expected consumer prices and wholesale prices earlier in the week. Advancing stocks trounced decliners on the NYSE by 8-1. Winners topped losers on the Nasdaq by more than 4-1. The Dow Jones closed above its 21 day line Thursday and retook its 10 day line Friday. The blue-chip index added close to 1.1%, while the 35,000 level remains a potential resistance level. The S&P 500 surged above its 21 day line rising 1.5% in lower volume. Finally the Russell 2000 and its smaller companies rose 2.4%, but still below its 50 day line. The Dow held up well Friday, despite a sell-off in shares of Disney who reported a bigger bottom line, but sales missed, hurt by weaker-than-expected subscriber growth for its Disney Streaming service. Weakness in Disney was offset by strength in Goldman Sachs, up 3%. The very commodities that have helped build our economy, have again rallied , with Copper, Lumber and Iron Ore, and Palladium reaching record prices in recent days, while corn and soybeans trade around the highest since 2012. "The commodity rally is a "reflection iof significant demand over a short period of time following the pandemic," says John Kartsonas, managing partner at Breakwave Advisors, the advisor for the Breakwave Dry Bulk Shipping. "Demand growth is so strong because it is starting at relatively low levels due to the pandemic, the world isn't running out of commodities," he says. "The logistic system cannot handle such a spike in demand in a short period of time." Lumber futures prices are up about 60% from the end of 2020. Prices hit a record high of $1.670.50 per 1,000 board feet on May 7. Prices reflect "shortages in actual product," says Kartsonas, with new highs for cement and steel futures in Asia reflecting real demand for construction materials. As previously noted in 'Reflections' articles, Copper futures climbed to a record settlement of $4.76 a pound on May 11. "Strong demand, but also speculative activity," has led to the rise, with the metal considered a "macro-related commodity with lots of fund activity behind it," says Kartsonas. On May 12 meanwhile, iron ore reached an all-time high of $218.38 per metric ton, while steel futures were at record high of $1630 per short ton on May 11. Lastly, corn and soybeans continue to reach record prices, as there is no let up in these basic demands. "You need ships to move the basic commodities in order to produce goods," Kartsonas says. Freight is "highly correlated, with economic activity over long periods of time," and this year, "strong demand for commodities has led to strong demand for oceangoing transportation." Freight rates have increased, lifting the ETF's returns. A truly complex commodities market. A bit on Bitcoin...a bit down but not out. Cryptocurrency had a bad week (presently $38,500 on 5-19), falling over 30% to a low of $36,189, with lots of negative news topics, (off it's all time high of $64,829.14 from mid April). One of the biggest catalysts, Tesla CEO Elon Musk saying that EV maker will no longer accept Bitcoin as payment for vits vehicles because of the mining effect on the environment. Bloomberg also noted that the Department of Justice and Internal Revenue Service are investigating money laundering and tax evasion on Binance. Reports also indicated that hackers were active. Still after a very bad week, the crypto's market value is near $1Trillion, up more than a 100% for the year. "Crypto may feel doomed, but it's not dead," says Avi Salzman, writer for Barron's RUMBLINGS ON THE STREET Ed Yardeni, President of Yardeni Research, Barron's "All you have to do is open up your eyes to see there is inflation pressure everywhere," says Ed Yardeni, we are in stimulus shock." For evidence, he points to the 26% year-over-year increase in M2 money supply, the largest gain since 1943, as fiscal spending in response to the pandemic has topped $5 trillion. "M1, or very liquid money in circulation, is up by 316%. The Fed, meanwhile, has shown no sign of slowing the $120 billion in monthly purchase of Treasuries and mortgage-backed securities that it began in response to the pandemic," he says. Torsten Slok, Apollo Global Management chief economist, Barron's "The evidence, though, suggests that it's risky for investors not to prepare for a Fed that is wrong--or only half-right. That would result in an economy that is weaker than it appears but with persistent inflation portending the stagnation last seen a half-century ago. "The trend is not the Fed's friend," says mr. Slok. Rachelle Walensky, head of the Centers for Disease Control and Prevention, on ending the mask mandate for vaccinated Ameericans, Barron's, "We have all longed for this moment..." Goldman Sachs Report on Copper and EV effect IBD "Electric vehicles have more than five times the copper of ICE (Internal combustion engine) vehicles and by the end of the decade they will account for around 40% of the green copper demand," said the Goldman Sachs report. It forecasts that worldwide EV production will jump to 31.5 Million vehicles a year by 2030, up from 5.1 million in 2021. [5 Things to Do if the Tech Correction Continues]( Tech stocks had a decade of soaring returns capped off by a jaw-dropping 2020. But in recent months, the sector has undergone a bit of a correction. Whether it's a short-term blip or a longer-term phenomenon has yet to be seen. Worried the sell-off will continue? Here's what to do if you're worried about an ongoing correction. [Article continues...]( [Here Are The 4 Best Places To Live - And Work - Abroad]( While just about every country the world over is willing to provide you with a tourist visa that lets you hang around for a few months, not all countries will give you permission to live and work within their borders if you don't have a job offer from a local employer. Others will give you a long-term residence visa that lets you legally live in the country, but they won't allow you to work. So it is, then, that the holy grail for those of us who want to move overseas but still need an income is finding a country where living and working come together. Which brings us to the genesis of this month's cover story: the best places to consider if your plans in 2021 include finally pursuing that dream of relocating abroad to live and work. So, where might you consider looking instead? Read on... [Click to continue reading this article...]( [4 Steps To Safeguard Your Retirement Accounts From Cyber Hacks]( Cyber hacks are on the rise, and the next one could be coming for your retirement. Government watchdogs tell 25 Investigates, retirement accounts, like 401ks, are at risk, and they want to overhaul how they're protected. Better protecting what could amount to your life savings and personal information is the goal of a new report from the Government Accountability Office. The GAO says retirement accounts, valued at $6.3 trillion as of 2018, and the large firms that manage them are big cyber targets. The GAO report says since so much information is shared among multiple parties, the U.S. Department of Labor should create clear guidelines about who is most responsible for mitigating cyber threats and how that should happen. [More here...]( SPONSORED CONTENT [This Trading Book Sells For $19.95 On Amazon. 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