MW This meme stock stands out in a market that wants to go even higher

By Lawrence G. McMillan

Opendoor Technologies options are less-risky bets on this hot stock. Meanwhile, the S&P 500 continues to defy gravity.

The S&P 500 Index SPX continues to plow ahead to one all-time high after another. The SPX chart remains bullish, and even though there are overbought conditions, we are not seeing confirmed sell signals yet. There is support at 6,200 (last week's lows), at 6,150 (the previous highs) and then in the 6,020-6,060 area (gap on the SPX chart), and finally at 5,920. All of these are marked on the SPX chart below. The chart is bullish as long as SPX remains above 5,920.

SPX has now climbed back above the +4<SIGMA> "modified Bollinger band" (mBB). As a result, the previous McMillan Volatility Band $(MVB.AU)$ sell signal has been stopped out. The whole process of potentially setting up a sell signal now has to begin anew. The first step would be a "classic" mBB sell signal, which will occur when SPX closes below the +3<SIGMA> band. That is not a tradeable signal, though, and we would require further downside action in order to produce another MVB sell signal. There is no guarantee that that sell signal will indeed take place.

Equity-only put-call ratios continue to decline. The standard ratio has fallen below last year's lows and is now at the lowest levels since November 2021. Even so, that is merely an overbought condition and not a sell signal. Similarly, the weighted ratio has fallen to new 2025 lows, but it has not yet exceeded the lows of 2024. It, too, is in overbought territory. However, these ratios will not give confirmed sell signals until they roll over and begin to trend higher.

Previously, breadth had weakened a bit, but not enough to generate confirmed sell signals from both breadth oscillators. Now, it has improved once again, and so both breadth oscillators are on buy signals and are in overbought territory. It is a positive thing to see breadth being overbought when SPX is making new all-time highs.

Cumulative volume breadth $(CVB.AU)$ has continued to make new all-time highs, both in "stocks only" terms and in NYSE terms. This is strong confirmation of the new highs being made by SPX.

New highs on the NYSE have continued to dominate new lows. Thus, this indicator remains bullish for stocks and will continue to do so until new lows exceed new highs for two consecutive days on the NYSE.

Realized volatility - as we define by the 20-day historical volatility of SPX (HV20) - has continued to fall and is now down to 7%. That, too, is an overbought condition. This will produce a confirmed sell signal when HV20 rises back above 10%, but that could take some time.

Implied volatility VIX has continued to decline as well. Therefore, both the "spike peak" and trend of VIX buy signals are intact. The "spike peak" buy signal took place on June 24. It has therefore been in place for 22 trading days, as of today. By the terms of the trading system that we built around the "spike peaks," the trade should be closed.

In fact, one can continue to hold a position with a tightened stop. The trend of VIX buy signal would be stopped out if VIX were to close above its 200-day moving average (currently at 19.60) for two consecutive days.

The construct of volatility derivatives remains bullish as well. The term structures of the VIX futures and of the Cboe volatility indices slope upward, and the VIX futures are trading at a large premium to VIX. Our weighted measure of VIX futures premium stands at 2.83, well above the sell threshold of 0.50.

In all, we remain bullish. We are mindful of the overbought conditions and will trade any confirmed sell signals that occur, but at this point there aren't any confirmed sell signals. Continue to roll deeply in-the-money calls up to higher strikes.

New recommendation: Opendoor Technologies $(OPEN.UK)$

This week, Opendoor (OPEN) exploded to the upside and then quickly retreated. The rally started after there was positive mention of the stock on social-media sites. Shares then gained momentum, reaching close to $5 before falling back. There was such strong momentum in option and stock volume that there is usually some follow-through to action like this. This is a highly speculative situation, but with options, one can limit the risk.

Buy 5 OPEN (Aug. 15) 2.5 calls in line with the market.

Market insight: Alphabet and Tesla report earnings

Alphabet $(GOOG.UK)$ (GOOGL) reported earnings after the close on July 23, and the stock is modestly higher today. Leading into the earnings, the option market had priced the near-term straddle at 11 points (that would be a move of 5.8% based on the stock's closing price). That was a gross exaggeration. The stock was trading near $191 just before the earnings announcement, and in overnight trading it had a range of $186 to $199. That's nowhere near an 11-point move.

This is the second quarter in a row, and third of the past four, where the post-earnings movement for Alphabet has been quite subdued. Either the analysts are getting better at predicting earnings, or traders are confused about future prospects and aren't pushing hard one way or the other.

Tesla $(TSLA)$ also reported earnings after the close on Wednesday. Coming into the earnings, the option market had priced the straddle at 23.80, or 7.15% of the stock price. That straddle price was cheaper than eight of the past 10 post-earnings moves by TSLA - meaning that the odds were theoretically with you if you bought the straddle. This morning the stock has been down as much as 31 points in early trading, so the straddle was justified. TSLA continues to confound analysts, but perhaps there is also so much extraneous "noise" going on with TSLA that earnings aren't the only thing to be concerned about.

New recommendation: Atai Life Sciences $(ATAI)$

There has been strong action - price movement, option volume and stock volume - on Atai Life Sciences (ATAI). As a result, a speculative position can be taken.

Buy 4 ATAI (Aug. 15) 2.5 calls in line with the market. Set a trailing closing stop at $2.75.

Follow-up action:

All stops are mental closing stops unless otherwise noted.

We are using a standard rolling procedure for our SPY spreads: In any vertical bull or bear spread, if the underlying hits the short strike, then roll the entire spread. That would be roll up in the case of a call bull spread or roll down in the case of a bear put spread. Stay in the same expiration and keep the distance between the strikes the same unless otherwise instructed.

Also, for outright long options, roll if they become 8 points in-the-money.

Long 2 APH $(APH)$ (Aug. 15) 100 calls: After reporting earnings on July 23, this stock had a wild ride - trading in a 13-point range. Raise the closing stop to 99. Roll up again at 110.

Long 1 TSEM (Aug. 15) 50 call; These calls were rolled up to the 50 strike when TSEM $(TSEM)$ traded at $50 on July 17. Roll up again at 55.

Long 1 SPY (Sept. 19) 585 call and short 1 SPY (Sept. 19) 635 call: This is the position based on the differential between implied and historical volatility. SPY SPY has almost reached 635, so roll both sides up 50 points to the SPY (Sept. 19) 635-685 call bull spread. Stop out if SPY closes below 621.

Long 2 SPY (Aug. 1) 624 calls: This position was bought in line with the cumulative volume breadth (CVB) buy signal. That signal is still in effect. CVB made a new all-time high on each of the last three trading days, both in "stocks only" terms as well as NYSE terms. The target was for SPY to eventually make a new all-time high, which it has done. Roll up to the SPY (Aug. 22) 635 calls. Hold with a trailing, closing stop at 621.

Long 1 SPY (Aug. 15) 625 call and short 1 SPY (Aug. 15) 640 call: This position is the trend of VIX buy signal. Stop out if VIX closes above 20 for two consecutive days.

Long 1 SPY (Aug. 1) 630 call and short 1 SPY (Aug. 1) 650 call: This is the "spike peak" buy signal of June 24. SPY traded at 630 on July 21, so the spread was rolled up, per the standing instructions above. Even though the 22-day holding period for the "spike peak" buy signal trading system has been reached (as of today), we are going to retain a position with a tightened stop: Sell the spread and buy the SPY (Aug. 22) 635 call outright long. Stop out if VIX closes above 18.37.

Long 5 SVXY (Aug. 15) 44 calls: We monitor the weighted VIX futures premium via a proprietary calculation. Specifically, the calculation is currently at 2.83. This SVXY SVXY trade would be stopped out if this measure drops to 0.50 or lower. We will update the calculation weekly.

Long 1 SPY (Aug. 29) 625 call and short 1 SPY (Aug. 29) 645 call: We will hold until new lows outnumber new highs on two consecutive days on the NYSE.

Long 1 AAPL (Aug. 15) 210 call and short 1 AAPL (Aug. 15) 225 call: We will hold as long as the weighted put-call ratio for AAPL $(AAPL)$ remains on a buy signal.

Long 1 SPY (Sept. 19) 625 put and short 1 SPY (Sept. 19) 575 put: This is the McMillan Volatility Band (MVB) sell signal. $SPX closed above the +4<SIGMA> "modified Bollinger band" on July 23, and this position should be sold. Another MVB sell signal may set up in the future.

Long 3 DOCU (Aug. 15) 80 calls: These were bought when DOCU $(DOCU)$ closed above 80 on July 22. We will hold as long as the weighted put-call ratio for DOCU remains on a buy signal.

All stops are mental closing stops unless otherwise noted.

Send questions to: lmcmillan@optionstrategist.com.

Lawrence G. McMillan is president of McMillan Analysis, a registered investment and commodity trading advisor. McMillan may hold positions in securities recommended in this report, both personally and in client accounts. He is an experienced trader and money manager and is the author of the book, "Options as a Strategic Investment." www.optionstrategist.com

MW This meme stock stands out in a market that wants to go even higher

By Lawrence G. McMillan

Opendoor Technologies options are less-risky bets on this hot stock. Meanwhile, the S&P 500 continues to defy gravity.

The S&P 500 Index SPX continues to plow ahead to one all-time high after another. The SPX chart remains bullish, and even though there are overbought conditions, we are not seeing confirmed sell signals yet. There is support at 6,200 (last week's lows), at 6,150 (the previous highs) and then in the 6,020-6,060 area (gap on the SPX chart), and finally at 5,920. All of these are marked on the SPX chart below. The chart is bullish as long as SPX remains above 5,920.

SPX has now climbed back above the +4<SIGMA> "modified Bollinger band" (mBB). As a result, the previous McMillan Volatility Band (MVB) sell signal has been stopped out. The whole process of potentially setting up a sell signal now has to begin anew. The first step would be a "classic" mBB sell signal, which will occur when SPX closes below the +3<SIGMA> band. That is not a tradeable signal, though, and we would require further downside action in order to produce another MVB sell signal. There is no guarantee that that sell signal will indeed take place.

Equity-only put-call ratios continue to decline. The standard ratio has fallen below last year's lows and is now at the lowest levels since November 2021. Even so, that is merely an overbought condition and not a sell signal. Similarly, the weighted ratio has fallen to new 2025 lows, but it has not yet exceeded the lows of 2024. It, too, is in overbought territory. However, these ratios will not give confirmed sell signals until they roll over and begin to trend higher.

Previously, breadth had weakened a bit, but not enough to generate confirmed sell signals from both breadth oscillators. Now, it has improved once again, and so both breadth oscillators are on buy signals and are in overbought territory. It is a positive thing to see breadth being overbought when SPX is making new all-time highs.

Cumulative volume breadth (CVB) has continued to make new all-time highs, both in "stocks only" terms and in NYSE terms. This is strong confirmation of the new highs being made by SPX.

New highs on the NYSE have continued to dominate new lows. Thus, this indicator remains bullish for stocks and will continue to do so until new lows exceed new highs for two consecutive days on the NYSE.

Realized volatility - as we define by the 20-day historical volatility of SPX (HV20) - has continued to fall and is now down to 7%. That, too, is an overbought condition. This will produce a confirmed sell signal when HV20 rises back above 10%, but that could take some time.

Implied volatility VIX has continued to decline as well. Therefore, both the "spike peak" and trend of VIX buy signals are intact. The "spike peak" buy signal took place on June 24. It has therefore been in place for 22 trading days, as of today. By the terms of the trading system that we built around the "spike peaks," the trade should be closed.

In fact, one can continue to hold a position with a tightened stop. The trend of VIX buy signal would be stopped out if VIX were to close above its 200-day moving average (currently at 19.60) for two consecutive days.

The construct of volatility derivatives remains bullish as well. The term structures of the VIX futures and of the Cboe volatility indices slope upward, and the VIX futures are trading at a large premium to VIX. Our weighted measure of VIX futures premium stands at 2.83, well above the sell threshold of 0.50.

In all, we remain bullish. We are mindful of the overbought conditions and will trade any confirmed sell signals that occur, but at this point there aren't any confirmed sell signals. Continue to roll deeply in-the-money calls up to higher strikes.

New recommendation: Opendoor Technologies (OPEN)

This week, Opendoor (OPEN) exploded to the upside and then quickly retreated. The rally started after there was positive mention of the stock on social-media sites. Shares then gained momentum, reaching close to $5 before falling back. There was such strong momentum in option and stock volume that there is usually some follow-through to action like this. This is a highly speculative situation, but with options, one can limit the risk.

Buy 5 OPEN (Aug. 15) 2.5 calls in line with the market.

Market insight: Alphabet and Tesla report earnings

Alphabet (GOOG) (GOOGL) reported earnings after the close on July 23, and the stock is modestly higher today. Leading into the earnings, the option market had priced the near-term straddle at 11 points (that would be a move of 5.8% based on the stock's closing price). That was a gross exaggeration. The stock was trading near $191 just before the earnings announcement, and in overnight trading it had a range of $186 to $199. That's nowhere near an 11-point move.

This is the second quarter in a row, and third of the past four, where the post-earnings movement for Alphabet has been quite subdued. Either the analysts are getting better at predicting earnings, or traders are confused about future prospects and aren't pushing hard one way or the other.

Tesla $(TSLA.UK)$ also reported earnings after the close on Wednesday. Coming into the earnings, the option market had priced the straddle at 23.80, or 7.15% of the stock price. That straddle price was cheaper than eight of the past 10 post-earnings moves by TSLA - meaning that the odds were theoretically with you if you bought the straddle. This morning the stock has been down as much as 31 points in early trading, so the straddle was justified. TSLA continues to confound analysts, but perhaps there is also so much extraneous "noise" going on with TSLA that earnings aren't the only thing to be concerned about.

New recommendation: Atai Life Sciences (ATAI)

There has been strong action - price movement, option volume and stock volume - on Atai Life Sciences (ATAI). As a result, a speculative position can be taken.

Buy 4 ATAI (Aug. 15) 2.5 calls in line with the market. Set a trailing closing stop at $2.75.

Follow-up action:

All stops are mental closing stops unless otherwise noted.

We are using a standard rolling procedure for our SPY spreads: In any vertical bull or bear spread, if the underlying hits the short strike, then roll the entire spread. That would be roll up in the case of a call bull spread or roll down in the case of a bear put spread. Stay in the same expiration and keep the distance between the strikes the same unless otherwise instructed.

Also, for outright long options, roll if they become 8 points in-the-money.

Long 2 APH $(APH.UK)$ (Aug. 15) 100 calls: After reporting earnings on July 23, this stock had a wild ride - trading in a 13-point range. Raise the closing stop to 99. Roll up again at 110.

Long 1 TSEM (Aug. 15) 50 call; These calls were rolled up to the 50 strike when TSEM (TSEM) traded at $50 on July 17. Roll up again at 55.

Long 1 SPY (Sept. 19) 585 call and short 1 SPY (Sept. 19) 635 call: This is the position based on the differential between implied and historical volatility. SPY SPY has almost reached 635, so roll both sides up 50 points to the SPY (Sept. 19) 635-685 call bull spread. Stop out if SPY closes below 621.

Long 2 SPY (Aug. 1) 624 calls: This position was bought in line with the cumulative volume breadth (CVB) buy signal. That signal is still in effect. CVB made a new all-time high on each of the last three trading days, both in "stocks only" terms as well as NYSE terms. The target was for SPY to eventually make a new all-time high, which it has done. Roll up to the SPY (Aug. 22) 635 calls. Hold with a trailing, closing stop at 621.

Long 1 SPY (Aug. 15) 625 call and short 1 SPY (Aug. 15) 640 call: This position is the trend of VIX buy signal. Stop out if VIX closes above 20 for two consecutive days.

Long 1 SPY (Aug. 1) 630 call and short 1 SPY (Aug. 1) 650 call: This is the "spike peak" buy signal of June 24. SPY traded at 630 on July 21, so the spread was rolled up, per the standing instructions above. Even though the 22-day holding period for the "spike peak" buy signal trading system has been reached (as of today), we are going to retain a position with a tightened stop: Sell the spread and buy the SPY (Aug. 22) 635 call outright long. Stop out if VIX closes above 18.37.

Long 5 SVXY (Aug. 15) 44 calls: We monitor the weighted VIX futures premium via a proprietary calculation. Specifically, the calculation is currently at 2.83. This SVXY SVXY trade would be stopped out if this measure drops to 0.50 or lower. We will update the calculation weekly.

Long 1 SPY (Aug. 29) 625 call and short 1 SPY (Aug. 29) 645 call: We will hold until new lows outnumber new highs on two consecutive days on the NYSE.

Long 1 AAPL (Aug. 15) 210 call and short 1 AAPL (Aug. 15) 225 call: We will hold as long as the weighted put-call ratio for AAPL (AAPL) remains on a buy signal.

Long 1 SPY (Sept. 19) 625 put and short 1 SPY (Sept. 19) 575 put: This is the McMillan Volatility Band (MVB) sell signal. $SPX closed above the +4<SIGMA> "modified Bollinger band" on July 23, and this position should be sold. Another MVB sell signal may set up in the future.

Long 3 DOCU (Aug. 15) 80 calls: These were bought when DOCU (DOCU) closed above 80 on July 22. We will hold as long as the weighted put-call ratio for DOCU remains on a buy signal.

All stops are mental closing stops unless otherwise noted.

Send questions to: lmcmillan@optionstrategist.com.

Lawrence G. McMillan is president of McMillan Analysis, a registered investment and commodity trading advisor. McMillan may hold positions in securities recommended in this report, both personally and in client accounts. He is an experienced trader and money manager and is the author of the book, "Options as a Strategic Investment." www.optionstrategist.com

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July 24, 2025 14:44 ET (18:44 GMT)

MW This meme stock stands out in a market that -2-

(c)McMillan Analysis Corporation is registered with the SEC as an investment advisor and with the CFTC as a commodity trading advisor. The information in this newsletter has been carefully compiled from sources believed to be reliable, but accuracy and completeness are not guaranteed. The officers or directors of McMillan Analysis Corporation, or accounts managed by such persons may have positions in the securities recommended in the advisory.

-Lawrence G. McMillan

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