Did SpaceX Just Destroy Telecoms? (What Traders NEED to Know)

Did SpaceX just totally disrupt the telecom sector? Is Metamuse slowing down and it's earning season? What are the names that you should be watching? This is Sunday Scan and by the end of this scan, you will know the answer to all those questions and more. I'm Chris with Investors Underground and every single week, we bring you the most inplay stocks, themes, and tickers so that you can get more prepared to trade the markets in the week ahead. We have a lot to cover this week. There's a lot of things that have been happening. We have earning seasons coming up. Uh we have a lot of uh sector rotation happening underneath the surface. Uh we had some scarce over the past week with uh um open AI having some revenue uh concerns dropping from 70 billion to 50 billion and then they kind of uh you know came back up and said it was still 70 billion. We had some massive volatility off of that. Some great trades that we're going to review. We have Madna going parabolic right now. We have Verizon and all these other names selling off really heavily on the SpaceX news. And then we have a lot of other interesting things kind of happening in the market. Anthropic is banning certain behavior against their models. Uh does that bring into questions of consciousness for the models? Is that more just to save compute? Uh we'll get get into that a little bit in today's scan as well. So a lot of things to come cover. Before I get into all those, I will give the disclaimer that I'm not a financial adviser and these are not buy or sell recommendations. Everything I'm going to talk about today is for educational andformational purposes only. Before we get into the scan, I want to remind everyone that we have that deal with Clear Street. So, if you click the link in the pinned comment, you will get access to the founders accounts where if you deposit $5,000 and hold it there for 90 days, you will get a $250 bonus plus a free month of Investors Underground. So, if you've been looking for a new broker, and I know there's been a lot in the news recently, uh things like uh Weeble have come under a lot of scrutiny uh from, you know, House committees questioning ties to China. the company's denying it. But, you know, at the end of the day, if you just want a non-drama broker with the best AI tools and everything that you need to be able to trade the markets effectively, then check out that link and it's a great name to check out. Um, okay. I'm going to pull up some charts now and we're going to run through a bunch of topics. I'm going to try to get everything uh done in about 20 minutes or so and by the end of it, you will be super prepared for the week ahead. So, let's get right into Sunday scan. Uh, the first thing to really talk about is SPX. And there's a trade recap I want to go over really quickly and then also uh we're going to get into a few things. Uh but I really want to go over this day that we had a few days ago where we had a unique situation that set up for a really nice trade. So basically what we had is that uh I believe it was on Thursday. Um I I believe it was on Thursday. I could be wrong about that. Uh but we had a headline come out from Trump that caused the market to spike up and then right afterwards we had that rejection and then we had a big flush. So what happened there and how were we able to get some really good trades off of that? So this is basically what happened. The market was just kind of having a a usual day. Um you know a little bit of selling off but then you had a headline come out from Trump saying that you know they weren't going to engage in more uh strikes in the Middle East until after the midterm. So uh the market has been very very programmed to react to any kind of uh headlines like that because it has huge huge implications for oil. It has huge implications for interest rates and what the Fed could do. And so anytime you have something mentioned like ceasefire or anything like that you can have algo trigger uh because you know if you were actually to have a very real positive headline that could have massive implications. So what happened is that Trump in an off comment said that you know we're not going to make any strikes until after the midterms and the markets immediately spiked up on that and I think it was really just alos getting triggered for those key words that they're all programmed to look out for now. So the problem with that is that that was kind of already assumed information at least you know leading up to this point assuming that there's no uh you know new conflict which there actually has been some developments over the weekend but uh basically the market initially reacted to that and then it started to just kind of come back down to what it was at before because that was kind of the the status quo. Trump had already said that no more strikes were really going to be considered uh you know super heavily at least until after the midterms because they didn't want any of that to interfere uh with elections or things like that. So basically what can happen is when you get these false headline spikes, it can do two things. One, it can remove a lot of the hedges from the market which actually leaves it more vulnerable to the downside. What I mean by that is that if the market's just kind of in a range, a lot of times as it's drifting between those different ranges, uh you have, you know, a certain amount of puts that are sold, you have a certain amount of C, uh calls that are sold, and so the options market is kind of pricing in a range for the market. It kind of like think of standard deviations or just kind of an expected range, what the market is expecting. What can happen is that if you have a headline spike up, it can basically move the bottom part of that range. And so all those puts come off because they're like, "Oh, it was good news." And so that range is going to move up. Instead of being stuck in this 10 or 20 point range, now you know that bottom's going to move up, the top will move up. So what happens is that those uh those puts can come off, those hedges in the market can come off. And then what can happen is that if that headline rejects and it starts to go back down, now you don't have the same cushioning or the same, you know, uh something that can soften that blow to the downside. And so one of the most vulnerable situations the market can be in is when you have something that clears out those hedges and it gets rid of them. And then right afterward you had the headline that Anthropic uh I'm sorry that Open AI their revenue was 20 billion short of what they expected it to be down from you know from 70 billion in 2026 down to 50 billion. It ended up being kind of an accounting thing of how they were just calculating it. And the Financial Times, I believe, did, you know, kind of a a interesting job kind of presenting that, but that was the headline. That's what moved the market. So, you had that initial spike up, cleared out those hedges, rejected because it was just kind of the status quo. And then you had a negative headline which left the market vulnerable to that flush. And you had some really, really good trades. Nate had some, you know, amazing trades on spy puts. I was playing S&P puts kind of behind the scenes there. So, a lot of us were able to have some pretty good trades um on moves like that. So, I just kind of want to go over that uh recap. Some people in the comments last week asked for some trade recaps about how some of these things are broken down. So, that's an example of one of the trades that I took this week. And uh again, you know, leave any comments that you have of what you want to see on Sunday scan and we will cover it. So, that's just something I want to get into really quickly. Uh now over the weekend we have had some headlines that uh there have been some more strikes in the Middle East and there also have been some uh you know even uh VLCC's or very large crude carriers uh that have been um struck and so that's going to have some implications for some things like uh BWE and some other uh you know kind of niche names that are a trade-off of you know how can ships travel and some of the the carrier names. So we'll get into that later on in scan. Um so a few other things um I want to talk about. So oil is obviously going to be on watch for the week ahead. If things do escalate, if we do get more strikes, then uh you know, you just have these pockets of where oil goes through these bursts and then it kind of calms down because you know the the main uh assumption here is that there's not going to be any major decisions until after the midterm. So we have, you know, more than uh or about, you know, a month that before that is kind of over and then uh you know, we could have some real volatility there. But that's just something on watch. Um yields. So, one of the things I want to touch on is that I think kind of where we are heading into midterms, where we are in the equity cycle, I actually think that on a broad basis that uh you know, kind of from an investor investor perspective, and I'll explain why that matters to traders. From an investor perspective, I think that yields and bonds are actually becoming much much more attractive here, especially going into more some more turbulent times. Um, you know, with like the elections and things like that coming up. So given the shakiness of some of the AI names and the headlines back and forth, given the level themselves that yields are at, I think that you're going to have some big money managers kind of rotate from equities from the very concentrated AI names back into some uh bonds or some things that are yielding. I think that it's at a high enough level now where it's kind of comparable to forward equity returns. If you assume that you know equities on average return 9% a year kind of as a market if you are a uh you know big money asset manager and you can get you know 5.6 six for you basically a risk-free treasury or you can you know assume the 9% for equities and you have a lot of turbulent things coming up that's something that they might you know take into account a lot more carefully and especially in the private credit markets you might be able to get seven or even 8% and so as you have bond yields kind of approaching equity returns you could have some rotation into that especially with major events coming up so why that matters is because it can influence uh bond yields it can influence you know money flows in the markets or just something to be aware of now like I said a lot of the concentration in the names have been in the mag seven names or kind of the the key AI names. So you could see the outperformance of these names over time especially in this market where while a lot of other things have been fairly weak and we've talked about like the Dow and also IWM coming under a lot of pressure and so really a split market with the AI names and with the MAG 7 names taking all the lead and then a lot of these other indices kind of lagging. So that's something to keep an eye on. But if you do have any negative headlines like we have earning season coming up, we have TSM and a few other names that are going to be reporting this week. If you have anything go wrong with any of those, you can really see the Q's come in. You can really see the MAG names come in as well. So that's something to be on watch as we get into earning season. A couple other things we're getting some inflows, continued inflows into software. So what we've kind of seen over the last year is that you've had this big kind of inverse correlation at least sometimes between software and some of the AI names. uh even things like memory. And so when usually when they're buying one group like the memory names, they're not buying something like software. When they are buying something like software, they're usually neglecting the memory names. And so sometimes you can have different parts of like a big equity book kind of balancing itself that way. And so right now software is in favor and a couple of names like uh Crowd Strike and also PNW are acting really really well. There's some other names too like okta and some other ones. I know Ariel has done super well on um you know in some of those positions. So, um, I'm going to get into the main watches for the week ahead. Now, I'm just going to talk about the names that I am personally watching and some of the game plans around those. Sometimes there's not a super clear game plan. It's more just keeping them on watch because in a market that's very headline driven, sometimes you really just have to wait to see what is going to be in uh, you know, what is going to be the theme of that day, what is going to be in play, what has recent news and catalyst. So being familiar with a lot of names and then really zoning in on that day and seeing what are the themes that are the most active, what has, you know, positive or negative news and then what is the market in general doing to try to give yourself a headwind or a tailwind depending on if you're looking for upside or downside. So um these are just on watch for continuation. You can see just really just uh trending well. Uh you can see kind of the variance of the trend start to tighten up. It starts to go up and that's getting pretty tight uh up in here. So that's that's pretty good uh sign for any like swing names is you want to see a pretty tight spread between the demand side and the supply side and that usually means that uh people are still getting their position into it. It's usually not super overextended. Although yes it has gone up a lot. Usually when you start to get names go vertical that's when you start to get a real extension in a name and it can start to get much more unstable. But this has had plenty of time and some dips along the way to kind of keep that trend. So what you could do is you can draw some trend lines kind of underneath here and then you know to the top side too and as long as it's holding that trend you can kind of use dips to buy uh you know for some of those names if that is a strategy that you know sounds appealing to you. Um those are the kinds of things that I look at uh you know when I'm looking for trending names whether I'm using options or equity or anything like that. The same thing goes for PanW. Uh it's the exact same thing in a favorable theme with software. It's in a leading group and it's also a nice tight technical pattern there where you have kind of a clear defined uh area where you can add and then areas where you can trim. Um couple other names. So Microsoft finally had a nice breakout. Um we were watching you know some of these levels as it was getting over that 58 level or so and then it finally had a slow and steady breakout. Again we've talked about uh you know breakouts and breakdowns really having multiple attempts and multiple failures along the way. So you can see this kind of steady progress but no like massive momentum burst like we're used to seeing in a lot of different markets. So it's just something to to be aware of that it's a lot more slow action even if you get the direction right. You have to make sure that you're taking into account the market conditions for that. A couple other names like NBIS starting to weaken a little bit and you can see yes they're still holding trend for the most part. If you were to draw some lines you know underneath here and then some other lines you know on the top side of that um you can see it's just kind of tightening up. um you know, but it's starting to uh you know, test the lower edge of that. So, if we start to break below some of these levels, then uh you could really see uh some downside open up in a couple of these names. Again, they're much more dayto-day. Do they have a positive headline or a negative headline? And that's kind of determining where in the range that they fall. Um banks, so banks are starting off earning season, they like they do almost every earning season. So, you're going to have names like JP Morgan, Goldman Sachs, Bank of America, all these different names uh reporting. So, they have sold off pretty heavily into that. Part of the reason is due to uh you know the the yield curve on the bond side and then you also have things like there are some of their trading activity has been down so some of their margins and their growth might be under pressure. So that's kind of been the assumption going into earning season. Let's see how they prove. Uh maybe they have a positive surprise and they start to really rally and bounce back off of that or maybe it's even worse than people thought and they start to break below these levels here. So banks and financials will be on watch. That's a big important group in the market and so that will definitely be something that I'll be watching over the coming uh few days. I want to see the bank's reaction. You know, is it better or worse than they were assuming? And then how is the stock uh itself reacting to that? Um couple other things I bet. So, we've actually had a decent amount of volatility to the downside in Bitcoin. It's been holding up fairly well, but it hasn't really been able to get any traction. Uh and you know, there's been a lot of uh I think hope going into election season that there's going to be some things passed and some progress, but there really hasn't been a whole lot. So, um I think there was a situation maybe a year and a half or two years ago where it's the same thing where everyone was hoping that there'd be some kind of big breakthroughs around like election time and then just nothing really happened and you had a pretty decent sell-off. So, we might be in for a similar situation like that. Uh but again, no hard bias. It's more just what are the headlines for that day. But if we start to break below some of these levels, then we are starting to break a little bit of the recent trend. And so, names like IBIT and MSTR will definitely be on watch for downside there. If they just kind of hold these trend lines here, then they are still in play and they hold their general uptrend at least short term. But if they start to break through below those levels, then that could signal a trend change. So draw some lines between those recent uh you know lows and then if you get any action below that that can signal a bearish trend. If they hold above it, that can be more of a bullish trend. And the same thing goes for names like circle. Uh Meta. So Meta is actually a very promising setup into the week ahead for downside in my opinion. Um, I'm going to be watching it for puts, especially underneath these kind of key levels around here. So, there was a headline out on Friday that was uh, you know, Metamuse, which is their AI agent, started to have a lot of uh, slowing down in downloads. That's to be expected. You know, after you have something like new and exciting, everyone goes and downloads it and then you use it for a little while and then you just kind of forget about it and like interest gets lost. So the reason why Meta was moving up so much uh kind of over the last couple of weeks was partly because of a lot of the hype around that agent, you know, Metam Muse uh kind of aspect to their business. So if hype is kind of slowing down there or the downloads are slowing down, you could have a pretty decent retrace. And you know something to to keep in mind is that even if you have a 25 or 30% retrace of the move, not you know not a 25 30% correction of the stock but if you were to look at this move as you know from zero and then 100% of that move uh it's very common for things to retrace you know 30 40 even 50% while still maintaining somewhat of a bullish bias on something. So um shortterm I'm watching this for downside. I think if we could uh you know get below some of these levels here, you know, draw your lines and then if we start to break below that, we could really open up, especially if we have some volume come back in to the downside. Uh memory names have been fairly weak. You can see a big divergence. Um so even like uh SNDK has been fairly weak. You can see it's starting to break a little bit of the trend line around here. So that's always signaling to me that, you know, something else might be going on behind the scenes that we're not super aware of. Uh MU has been holding up the best of the group. You can see holding that trend line. it's holding up towards the highs. While you have something with total relative weakness like WDC, which has been kind of breaking below these major levels here. So again, the same group, the same memory theme, but you have some leaders like MU and some lagards like uh WDC. So just keep those on watch. If you have any negative headlines for the memory space, WDC is going to be my go-to for downside. If you have any positive headlines, then MU is going to be my go-to for upside there. Uh HPE, this has been on scan a lot over the last uh you know, month or so. This has just been a really nice uh you know steady breakout. Again, not that like typical momentum burst where you have that giant candle and then like some consolidation. You more just have that same um you know uh you get to the same place but in a different way. So instead of the big uh you know like like over here for example, sometimes you have like a big swipe up and then you have a bunch of consolidation. This is over a larger time frame and then it kind of rallies or other times you just have a slower rally but it doesn't have those dips along the way. So, uh, this has kind of been, you know, uh, staying bullish above those levels. So, this is still on watch for continuation until it starts to get really overextended and then it'll be on watch for mean reversion. CVRS, we talked about how this is kind of a big bouncy ball breakdown setup on the daily. Even with some positive news, it still stayed pretty heavy. So, underneath these levels, um, it could really start to open up to the downside. So, this will be on watch for either, you know, short selling or for, um, you know, uh, puts. That's the way I would play this with put options. That's my my personal style. A couple other things we talked about Zcash breaking trend again. You know, whether you're looking at Zc Zcsh or um you know, Zcash itself, you had a pretty good mean reversion in that. That was kind of expected. We've been covering that for a while. And part of the reason was, you know, you had a very inthe kind of crypto play there for a while. And anything in cryptoland, it always has leverage built up around it. So when something goes uh long enough and you know, high enough for uh you know, that distance, a lot of times you get leverage built up around it. Then leverage comes out once you have a negative headline. And there were some negative headlines about two weeks ago uh you know with the Chinese saying that there's basically going to be some crackdowns on like the privacy coins like nothing can actually stay that that hidden like it claims to be in some ways. So that was one of the the negative headlines that was around the time that it started to be revert. So something to be aware of. Um, as far as bond yields, we talked about Zoz being a good benefit uh for, you know, a bounce trade, even better than TLT in a lot of cases because the zero coupon bonds, they it moves more sharply because everything's baked into the, you know, share price. It's not actually a share, but for the uh the asset price itself instead of being, you know, paid out via yield along the way. So, that is on watch for continued bounce. If yields have topped for the short term now, that would mean that this has bottomed for the short term now and it could have some move up especially into uh the US midterms. Uh GME still on watch. No trades here uh for me, but this is coming up to some levels. So if we have a nice you know um you know attempted breakout, we've been in a market where a lot of breakouts fail. So if we get above some of these levels and then reject, I might be looking for a counter trend kind of a fade there. So, I might be using output options to express a trade like that if it kind of clears out these levels and then sits back. Um, light had some really positive uh CEO comments and again the same thing. Even on positive catalyst, you're not seeing those momentum bursts like usual. You're really just seeing them test the highs and then slow steady breakouts there. So, that is a sign that money is a little bit cautious. It's not so much chasing some of these moves. It's more just waiting for those dips and institutions are being a little more cautious on that. Uh, and then uh Elon name. So, we have Tesla and SpaceX. Tesla has been fairly strong within the tape recently. Again, you can see, you know, it's almost everything is struggling around these breakout levels, but this is still on watch for maybe some continuation uh for the week ahead. And then SpaceX, so they really announced that they're getting much more into like the direct to sell um you know, space. That's kind of always been, you know, my assumption with it. And you have other names like ESTS and other names that have kind of you know, been trying to carve out a niche for the last couple years in that space. you have all these other, you know, companies like Verizon and T-Mobile and all these things that are trying to do the same thing. But in my opinion, at the end of the day, SpaceX is going to win that race. It's really hard to be second best uh in an industry like that where you basically have you know massive massive uh you know advantages if you are a step ahead of the competition. So um SpaceX has been trending up for a while not only from that but also from Grock and other things that are you know leading pretty well. So, uh, this had some consolidation. We talked about this in IU about this coming in a little bit. So, I know a lot of people had some really good trades on the downside for that. But again, bigger picture, I think longer term uptrend there. Uh, but, you know, for the time being, we can definitely go back and test some of these, you know, levels as it just kind of uh, you know, calms down into uh, the midterms. And then you can see the action in uh, TMUS and VZ and especially in AS. So after you have you know these big like flushes on some news because like SpaceX really got into uh the you know direct to sell uh you know thing they had some breakthroughs there. So a lot of times you'll have like these initial selloffs and then usually you'll have a day or two of kind of bouncing even if they continue lower uh you'll probably have a bounce going in here. So you can see kind of that tail on the bottom of the wick and then you also have that increased volume. A lot of times that makes for a decent bounce trade even if it's just back up to test some of these levels. That's still you know decent move from 47 back up to you know uh you know 54 55 or something like that. So um big picture bearish but short-term I think bounce trade uh for the week ahead. And then AMT and CCI these are actually some more like cellular network um things. So I think if uh SpaceX gets more into the telecom space then they're going to need some actual physical hardware for that too. And so these names could be potential beneficiaries of that. Palunteer has been on watch for uh you know it hasn't been on much on scan recently but this has been a really strong mover and this is one of the few names where you are getting kind of that momentum burst action where you have these you know big surges but then you also have some big retraces. So you can see just like this you know big surge and then retrace followed by another big surge. So this is just uh showing a lot of strength um you know over the last couple of weeks. And so this is on watch for continued upside you know to maintain that trend until maybe on a big picture it really you know burst through these levels. Uh maybe it has you know one test of that flush because again breakouts have been failing but I'm looking for this to get very overextended. If it has like three four days in a row of being up then I would be watching for that mean reversion after that. Um and then the bank names we already talked about those Bank of America JP Morgan. Um and then hood is an interesting one because if crypto stays weak then this could actually start to break this down this uptrend in my opinion. So if you start to get below some of these levels here then um and if you have crypto and bitcoin get weak then you could have some downside forming in hood in my opinion. Again they make a lot of their money from uh crypto trading activity and so if crypto is weak or things like that everything slows down they don't make as much money and you can also have it move on some of the bank activity uh that gets reported earlier on. TSM they report earnings uh you know this sometime this week. So that will be a big mover for the AI sector in general. Again we will see uh you know what their earnings are and what their revenue is and what their growth is and that can be a really good bell weather for the rest of the sector. Uh Bwet. So this is again the VCC's the very large crude carriers. This is basically theoretical rate of what it should cost for you know some of these large crude carriers to move in the Middle East between the Middle East and Asia. If there's a lot of conflict over there, if ships are getting hit, then there's like infinite uh, you know, kind of futures rates for those because if you can't have a ship actually do anything, then the the rate for that would be, you know, exponentially high until you get a headline where there's a ceasefire and then it mean reverts. But for right now, all signs point towards continued conflict kind of over the next couple of weeks. And so this probably goes nuts, blows out a bunch of traders on the short side. And then after that, maybe you get a kind of counter trend headline where you get some kind of a ceasefire or pause uh for the next couple of weeks into the elections. And then um you know, maybe it starts to have a big mean reversion there. But for now, all these names um especially the shipping names, all very strong uptrends. Maybe if you get some really overextended parabolic moves, you you could have them set up for some mean reversion, but for right now, just a strong uptrend. So those are really the names that I wanted to cover uh this week on Sunday Scan. Again, we go through a lot. We try to get everything that is in play in the market in front of you as traders. And then it's uh up to each of us to build our watch list, to build our trade plans, and then wait for catalyst. And what you really want to do as a trader is identify what are the leading themes, what are the lagging themes, what is in play, what has news, what has catalyst. And then if you see setups that you recognize, whether they're, you know, momentum burst setups or breakout setups or if there's some kind of continuation setups like a bouncy ball to the upside or a bouncy ball to the downside or whether it's a bounce trade or a blowoff top trade, you know, capitulation right side of the B kind of thing. There's a whole bunch of different setups that work in all kinds of markets. It's really just about identifying what's in play, what has what is setting up, what is rewarding traders, and then building trade plans around that. So, uh, I hope that that was helpful for you. Again, check out that link that we have in the pinned comment for Clear Street. Make sure that you open up an account there. You will be very happy uh that you did. And that's all I have for this week and we will see everyone in Investors Underground. Take care. Thank you everyone for watching. Be sure to like the video and subscribe to the Investors Underground YouTube channel. If you're interested in trading alongside us live, check out investors underground.com where some of the top traders in the world show up every single day. We have watch lists, we have video content, we have live trading ideas, and so much more. Take care. >> [music]