The Bed and Bath Bear Signal?

They existed a lot longer than expected or needed thanks to the retail hype army lead by Ryan Cohen of Gamestop fame and the 20-year-old firebrand college student who managed to acquire 6% of the company using only money from family, friends and uncle Dr. Scott Freeman a former phamaceutical executive and then selling (dumping) on retail for approximately $110 million in gains all while looking like this.

Seriously look at this guy… he looks like some redheaded supervillain who only smiles when he makes depressed-ego-maniac Kendall Roy types slam their head against the wall and cry. Very not rigged how he just disappeared but hey if we had $110 million it would be exactly the same.

[ nypost ]

Back to the point…

We are not out here ripping zynn and diet coke trying to tell you the bear force 1 signs are flashing because a glorified towel retailer who’s only marketing tactic was to get people in their stores by sending a 50% off coupon that you could only use on like a bar of soap is bearish.

However the market reaction is.

Last year shitco Revlon ($REV) filed for bankruptcy, the stock went down 13% on the announcement and proceeded to absolutely rip faces going up more than 300% in three sessions [ cnn ].

Of course that was nothing compared to the OG bankruptcy to billions stock Hertz ($HTZ) from 2020. They announced on a Friday after the close, opened lower on Monday only to go up over 825% in two weeks [ bi ].

The ultimate measure of froth, liquidity and degeneracy will be if a bankrupt company with little to no future prospects against money losing retail operations subsidized by cloud computing (Amazon) can rally after today.

However if $BBBY does the right thing and rolls over and dies, well then maybe being a profitable business matters after all.

And that would be incredibly bearish.

Market Action

Energy is having itself a day with market leader $XOM so close to its all-time high you could hit it with a putting wedge. OPEC cuts helped push the price of a barrel up 13.47% in the past month and with summer coming up, it doesn’t look like sub $3 a gallon will be coming back anytime soon thanks Obama.

First Republic Bank ($FRC) reports earnings after the close today and it’s trading like crazy up 9.52% with almost double their average daily volume and there’s still three hours left to go in the session. We had a look at the 4/28 options where the majority of volume is happening in the $20 call and then the $12 and $10 put combined. IV is super jacked on these north of 300%, so you only need a move of 20% in your direction to make 100% overnight. Easy right?

Options flow: Bears keep going into their draft folders and sending the celebratory tweets they wrote months ago but it’s hard to understand why when spooz is down a measly 18bps and you can feel the 0dte rip into the close deep in your loins. $SPY is at $411.50 now with a ton of gamma exposure at the $415 level which when we put into the non-existent rigd supercomputer she told us that it’s going to take out $412 with ease before rejecting at $415 and closing at at $412.50.

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