The Sunday Swell: August 16, 2026 Session

Sitting in the lineup and searching the horizon for the next wave to catch…

Sundays are my time to hit the “reset” button. I spend the morning running through various screens to build out my buy/short watchlists for the week ahead.

I want to emphasize the word watchlist. Whether these names turn into actual trades depends entirely on how the week develops and if the price action hits my own specific execution zones. Before we dive into this week’s list, a few quick notes to set the stage:

• The “Teach a Man to Fish” Disclaimer: This weekly update is for educational purposes. My goal is to show you exactly how I utilize the tools at my disposal—many of which you have access to. The star of the show is the Erlanger Chartroom Software. Having run the nightly processing for Erlanger Research for years, I know this system inside and out. I’m here to show you how to drive the car, not just give you the GPS coordinates.
• The Secret Sauce: My idea generation focuses on a “Triple Threat” of data: Short Interest (Educational Video), Options (Educational Article on MR and this is the main focus of a majority of my ideas), and Seasonality (Educational Video 1 and Educational Video 2). I often layer this with a fundamental quant filter from Revelation Investment Research. This helps me identify “1+1=3” opportunities or, conversely, flags the stocks we should stay far away from on the long side.  TIP: In Market Rebellion Squeeze Play Pro Activity Posts tab, enter in search “training” to bring up other various articles on the reports and how to use them.
• Know Your Style: My style is a bit different from Geoff’s. We complement each other, but you need to understand that these ideas are often shorter-term and more aggressive. I don’t always wait for the “all-clear” signal. Sometimes I’m catching a falling knife on a long or standing in front of a freight train on a short—taking small, tactical positions on aggressive charts looking for a reversal.

I might trigger on a daily Heikin Ashi candle turning green, while Geoff might wait for price action to cross a Displaced Moving Average (Educational Video). You might take one of these names and apply your own triggers—RSI, Stochastics, or standard MAs.  Whenever I do this, I think of the movie Hitch. There’s a scene where Will Smith is teaching Kevin James how to dance and tells him, “This is where you live. Right here.” (Video Here). It’s about staying in your lane. Take these ideas but apply the triggers that work for your risk tolerance.

So, let’s jump in. I feel like a kid again with my Churchill fins on, about to jump into 5ft Sandy’s (that’s 10ft mainland!) on a glassy day. Just make sure you read all the caution signs on the beach before you dive in headfirst.

Subject: Staying Safe as Lala Lashes Out & Late-Summer Complacency

Howzit Fellow Squeeze Players!

Much like Lala swinging through the Hawaiian Island chain—starting as a tropical storm, escalating into a Cat 1 brush-by, and currently dumping buckets of rain—I sense similar dark clouds gathering on the horizon of the markets.

On a personal note, I’ve had plenty of positive texts from my family and friends across the islands. While everyone is feeling the impact as the storm skirts past, all is good so far.

Not 100% Bearish, But Keeping a Short Leash

Am I 100% bearish on this tape? Heck no. We still have piles of negative sentiment that can easily serve as fuel to the upside. Short interest remains elevated across the board, paired with high readings in our proprietary Erlanger Options Data tilting heavily toward put activity.

However, there are two specific warning flags keeping my leash on longs short (following me here?) and prompting me to dip a toe in the water for fresh short setups:

• The VIX & Late-Summer Doldrums: (Alluded to in last Sunday’s session). Complacency is thick right now. We’re in peak late-summer illiquidity as senior portfolio managers and top traders are downing gin and tonics in the Hamptons. When the “JV squad” is left minding the desk, minor missteps can quickly cascade into panic. Keep a very close eye on this depressed VIX level—it historically does not stay down here for long. A post recently crossed my TweetDeck (now X Pro) that captured this dynamic perfectly. (Side note: If you are on X and not using TweetDeck/X Pro to filter your flow, you are simply doing it wrong. Google it.)

  👉 View Post on X: Market Complacency & Volatility Setups

• Traditional Seasonality: Late-August/September headwinds are already making their way onto trading desks, across research notes, and all over the boob tube (does anyone still watch that political entertainment masquerading as “financial news”?). But while others lazily post simple averages, here is what we are tracking from the Erlanger perspective with the actual statistical probability to back it up. (Video Information: Using Seasonality – Part 1 and Part 2 and also “white” paper)

The Lineup: Leaning Into the Asymmetry

When I dove into my screens to build this week’s watchlists, I found it significantly easier to harvest Short/Sell setups than long ones. Maybe I had a subconscious bias before reviewing, but the ideas were flowing naturally. The heavy imbalance of shorts versus longs in our aggregate scans has me raising an eyebrow.

The Week Ahead: Fed Minutes & Retail Heavyweights

• Wednesday’s Fed Minutes: Keep your eyes locked on the tape Wednesday afternoon when the FOMC minutes drop. (The Goldman Sachs podcast below is essential prep for this).

• Big-Box Retail Earnings: We get a true pulse-check on how the everyday consumer is holding up with WMT, HD, TGT, and LOW stepping into the earnings box.

Let’s be safe out there. Sending an extra shout-out of Aloha to my Mom, family, and all our friends across the islands as they ride out Lala!

The Background Tracks: Morning Prep Listening

While running the screens and building out the fresh watchlists for this week, I had these two excellent podcast episodes looping in the background:

• Goldman Sachs: The Markets | How Inflation and Fiscal Policy Are Driving US Treasury Markets: An institutional look at Treasury yields, fiscal deficit realities, and the structural interest rate dynamics ahead of this week’s Fed minutes release.

• The All-In Podcast | Anthropic’s $2T IPO, Zuck’s AI Manifesto, Nvidia’s $500B Bet, Grok’s Comeback: The Besties break down massive sovereign compute bets, hyperscaler infrastructure capex, and what the latest frontier model valuations mean for public tech multiples.

Let’s have a great week! Stay safe in the water, keep your stops tight, and watch the breeze.

 

From previous Sunday Swell Sessions Watch Lists (just search the term “SWELL” under the Activity Posts page.

• • Keeping on the long watch list for opportunity to unfold still:  MO, FLNC, EZPW, SGHC, NIO
  • Keeping on the sell/short watch list for opportunity to unfold still: DG, BAC, CROX, OXY, SHAK, CBRL, PATH
  • Removing on long watch list as price action unfolded or underlying data components does not support it anymore: PLUG, NOK, GEV, KEEL, FTI, EIX.
  • Removing on sell/short watch list as price action unfolded or underlying data components does not support it anymore: PII, ELF, EVLV.

New weekly additions to the trading watch list for me: 

From Erlanger Research Chartroom Library Reports:

MR Long Ideas – PC 10d PER Ratio High:

CTVA, BTDR, GME

Various Options Scans:

I source ticker lists from various scanners and drop them into an Erlanger Chartroom Quotesheet. (Tip: You can simply copy your own list of tickers and paste them directly into the ‘Symbol’ column). I place these in my custom Erlanger Workspace (*.CRW file—see this Educational Video for the setup). This week, a high-volume options screen flagged the following names for excessive negative sentiment (put activity). I am looking at a turnaround to the upside on my Long watch list.

Secondly, let’s head into slightly deeper water with a screen I call the ‘Low Country Boil.’ Living down here in the Lowcountry—and hitting the local beaches whenever a Hurricane Swell rolls in to keep my Hawaiian roots intact—I’ve learned that a proper boil isn’t about a quick flash in the pan. It’s about the simmer.  This specific screen is designed to catch lower priced stocks with options activity that is slowly building and largely undetected. Specifically, I’m watching for that slow, building swell of negative put activity. When it hits that boiling point where the sentiment is just too stretched, we look for the turnaround. It’s about spotting the wave while it’s still just a ripple on the horizon, long before it breaks for everyone else.  Not every indicator lines up perfectly, the waters are choppy here so navigate carefully.

GOOS, SEDG, SERV

Revelation Screens

This showed up on one of my Revelation Screens (i.e. positive fundamentals).  Underlying Erlanger items seems good for a long idea on the watch list:

CW

 

UOA Review

Bonus Section: UOA!  Sundays I like to export from the UOA section of Market Rebellion the weekly hits and size them up in Erlanger Chartroom for Short Squeezes and Put Squeezes (Long watch list):

none

 

To keep things balanced, I have a couple of names for the Short/Sell watchlist. Keeping with the theme: I’m looking for these building waves to finally break.  Generally, these are the flip-side setups in the options data—places where the call activity is becoming excessive even as the price keeps climbing. If you are long these names, you need to be hyper-aware of your surroundings and the potential dangers.  It reminds me of surfing Tonggs in front of the Outrigger Canoe Club back in high school. There was a massive boat winch from an 1878 ship wreck sitting just inside the break on a very shallow reef. You’d take off on a beautiful, good-sized wave, but you had to know exactly where that winch was. These charts are the same: the ride might feel great right now, but you’re potentially heading straight for the reef. Navigate carefully.

MR Short Ideas – CP 10d PER Ratio High:

ABT, DIS, AMT, TGT (earnings 8/19 am), OWL, SJM, USAR, MELI

 

 

Revelation Screens

This showed up on one of my Revelation Screens (i.e. negative fundamentals).  Underlying Erlanger items seems gloomy enough for a sell/short idea on the watch list:

NUE

UOA Review

I also took a weeks’ worth of ‘Bearish’ Unusual Options Activity from the Market Rebellion UOA Elite Service. My goal was to see which of those bets aligned with the negative sentiment readings we’re seeing in the Erlanger Chartroom.  Here are some names that aligned:

IGV, IHI

 

Various Options Scans:

I source ticker lists from various scanners and drop them into an Erlanger Chartroom Quotesheet. (Tip: You can simply copy your own list of tickers and paste them directly into the ‘Symbol’ column). I place these in my custom Erlanger Workspace (*.CRW file—see this Educational Video for the setup). This week, a high-volume options screen flagged the following names for excessive positive sentiment (call activity). I am looking at a turnaround to the downside on my Short/Sell watch list.

MBLY