Mark Newton. Macau. MARA. Merck. Musk, and More!

Wednesday Morning Rebel Brief

Good morning Rebels! Stock futures have turned mildly red on the back of Netflix’s stellar earnings… miss? Despite the market’s indecision this morning, Fundstrat CMT Mark Newton is getting bullish once again. 

Mark Newton Charts the S&P 500’s Breakout Close Above 50 Day Moving Average

The Fundstrat technician who was bearish at the beginning of the year took to CNBC on Tuesday afternoon to give his thoughts about why this week’s rally has him turning bullish once again. 

In short: Newton believes this is a breakout.

The S&P 500 has been trending lower essentially all 2022, however as of Tuesday, it has broken out of its most recent downtrend. Not only that, Tuesday marks the first day in over two months that the S&P closed above its 50 day moving average. These two events occurring simultaneously have led CMT Mark Newton to get cautiously bullish, telling CNBC’s Scott Wapner,

“There’s a lot of uncertainty as to whether stocks need to make one final low or not and I think today’s move makes me a little less certain that that needs to happen.”

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Macau Reopening

Macau has announced it will reopen casinos on Saturday in response to a drop in Covid-19 cases. Beaten down casino stocks like Las Vegas Sands (LVS, +1.41%), Wynn Resorts (WYNN, +1.56%), MGM Resorts (MGM, +0.92%) and more are trading higher on the back of the news.

Twitter vs. Musk: Elon’s First Setback

Billionaire Tesla CEO Elon Musk would nothing more than to wash his hands of the $44 billion dollar acquisition deal he made with Twitter — but the social media company isn’t having it. 

Last week, Twitter filed a suit against Musk in response to his attempt at terminating the deal. Twitter followed up with a motion: a request for an expedited 4-day trial in September. Musk and his legal team opposed — asking the judge for a trial that would take place “early next year”. 

Team Musk was unsuccessful. On Tuesday, the judge ruled in favor of Twitter’s request for an expedited trial. The legal battle will be five days long and will take place in October. 

An Unusual Option Activity Story in Two Pictures:

Market Rebellion Co-Founder @jonnajarian highlighted #UnusualActivity in $MARA $XLB & $XRT on today's 3@3 livestream.

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— Market Rebellion (@MarketRebels) July 19, 2022

Shares of Marathon Digital absolutely rocketed higher on Tuesday, and one trader caught the momentum perfectly. At noon, they spent more than $670K on 14,000 short term OTM call options in the crypto name with the stock trading at $11.53. By Tuesday’s close, MARA was trading at $12.90 — and it didn’t stop there. The stock ran is up yet another 3% this morning. 

More Brief Market Stories:

• Merck (MRK) is falling in the premarket on news that its cancer drug Keytruda has failed to pass its most recent study focused on head and neck cancer.
• ASML (ASML) has reported an earnings beat, but warns of a potential slowdown in demand of semiconductors.
• Netflix (NFLX) beat EPS and missed revenue, but is rallying off of new plans to introduce an ad-supported model as well as the continued roll-out of upcharges to password sharers.
• Biogen (BIIB) beat earnings handily on the top and bottom line. Despite trading as high as 3.74% in the premarket, the stock has pared back gains and is now trading flat.
• Tesla (TSLA) reports earnings tonight. The ATM straddle is indicating an implied move of 6.67% — compared to an average earnings move of 5.0% over the past four quarters.
  

For more quick takes on this morning’s market-moving news, check out 60 Seconds With Jon Najarian!