Stock Market Warning — CRDO & IREN Update + 2 Stocks I Bought (Options With Ryan)

[00:00:00] Speaker 1: Macroeconomic indicators are showing that this market is not in a risk-on environment yet. Both SPY and QQQ are both up today. I'm going to be talking about why that is, where the market could be headed from here, why I took off half of the hedges in my portfolio. We're also going to go over credo earnings and what I'm doing with that current position given that the stock fell over 18%. And we're also going to talk about a few stocks that I bought today and iREN updates. So let's go ahead and jump right into it. Remember, this is not financial advice. I'm just sharing what I'm personally doing for educational purposes only. Results may vary. Now, if we take a look at the portfolio, you can see this right here is my public portfolio that I share here on YouTube. If you do want to follow me along my eight-figure journey in the next five to six years, be sure to be subscribed by clicking the subscribe button down below this video. Also, hit that notification bell so you get my latest updates and you don't miss out on those. And if you get any value out of this video, please hit the thumbs up button for me. I'd greatly appreciate it and I appreciate you being here. Now, let's go ahead and go into the realized gain loss for transparency reasons. As you can see, today we took off half of the QQQ hedges that I put on for a nice profit on the day, as you can see there. But obviously, results vary day-to-day and month-to-month. But what I'm more happy about is my 1,049 clients here in Options Trading University, all following the principles and frameworks that we share here in the Mastermind. As you can see, our clients sharing their monthly inspiration for August. This client right here obviously results vary based off account size and risk tolerance. This was a record inspiration from one of our clients here. And the list goes on and on. If you do want access to my Ryan's Trades and Leaps, Entries, and Exits channel, that'll be at the top of the description down below this video. I also do give away free trade ideas here on my Instagram where I do daily market updates and share a little bit about my personal life, my X account, and my free newsletter. All three of those are down below in the description. So make sure to be subscribed because they're absolutely free. Now, let's dive into the news, okay? We see the Iran war escalating. It's not getting any better from here. You can see the headlines. President Trump floats, renaming the Strait of Hormuz to the Trump Strait, right? And that is causing oil prices to spike, treasury yields to go up, right? If we look at the CME FedWatch tool, you can see that now the odds of a rate hike are 95% odds for October, right? And then the next rate hike, 25 basis point, 82% in next March. And then we even have odds of a third rate hike coming onto the table later next year. So things are not looking very good here as far as my risk macroeconomic indicators. Yet, okay, we take a look also at the 10-year treasury. This thing is going up almost at 4.8% today, making a new high this year, which is not looking good, right? That's not good for interest rates. And we also see oil, right, up at $90 per barrel. So what is going on here? And why is the market actually going up today? So let's talk about that, all right? If we look at the market tide, we could see that, you know, institutional call buyers are stepping in on NVIDIA, Meta, MU, IWM, TSM, Oracle, right? A little bit of hedging going on, but mostly call buying today. In fact, there's call buying in this market sentiment of fear and greed. We're in the fear zone, right? So, you know, while there's a lot of people fearful right now, macroeconomic indicators aren't looking good. The market tends to look into the future, and we have to remember that. We have to not listen to what everyone's saying on the news, but look at what the market and the price action is actually doing. If we look at SPY today, okay, we had every chance to sell off here. All right, SPY, you know, was hitting the 760 level yesterday. We had every chance to go down to at least the 50-day moving average, which is what I expected, 755, or even lower, right? QQQ, same thing, right? Looking very weak yesterday at the lower Bollinger Band at 704. We had every opportunity for people to de-risk here, you know, take their profits. This thing would go down to 700 or maybe even lower, maybe even touch down here to the 680 or 690 region. And that is what I was expecting. Now, can that still happen? Yes, there is still some downside risk here. We do have numbers coming out, unemployment, core CPI next week on Friday. Could that push the markets downwards? Yes, but given that there is so much strength here with all the numbers looking bad, that is telling me that maybe we might get a surprise September rally, okay? So I'm just throwing that out there on the table. Now, I'm still playing it cautious here. While I'm still bullish in the markets, I still have exposure, I'm just doing it in a safer manner by selling cash-secured puts at a 20 delta strike, right? Something that's very low and far away from where the stock's trading so that if I do get assigned on a pullback, it's a good price on the stock and I'm willing to take assignment. But right here, we are at the lower Bollinger Band. I took off those QQQ hedges because I was up, you know, over 11% and I said, you know what? Let's take off half now. I'll leave on the SPY ones. If SPY does end up flushing next week or something, hey, we'll take those ones off as well. But I'm actually very surprised at the resilience in the market right now, given all of the indicators. So let's go ahead and dive into CRDO, okay? CRDO earnings came in actually quite phenomenal, yet the stock is down 20% right now, okay? Now, is this a buy zone or is this a let's avoid CRDO? Let's dive into the earnings and see what actually happened, okay? So CRDO, the verdict was they beat earnings, raised, and got destroyed anyways, okay? Revenue grew by 115% to a record 479 million. Earnings per share beats, right? And next quarter's guidance came in above consensus. So why did the stock go down? And there was one simple line item that caused the stock to go down, and that was the gross margin. The gross margin slipped to 64.5% from 68.2%. While that might seem like a little bit, the expectations were so high on this particular stock, given the PE ratio was above 100, trailing PE, that caused the stock to slip. Now, for me, okay, I do have a bullish case scenario on the stock, okay? No buybacks or dividends from the stock, but their cash position is very huge, 764 million with virtually no debt. So they're in a very, very strong position for growth, okay? Growth is extraordinary. Basically, full-year outlook lifted to 85% growth with optical products alone expected to contribute more than 600 million in fiscal 2027. So they have a lot of new products coming out that are already being, you know, pre-purchased by a lot of their partners, okay? But my thesis is bull case scenario, okay? We saw this stock, if we go back to CRDO, you could see that this stock went as high as 308, all right? It's currently down, as of now, about 46%. If you listen to good fundamentals, you know, buying below the 200-day moving average is always a good idea on a great stock, okay? A great stock with upward trending chart long-term, good fundamentals. PE ratio is currently at 58 for a stock with 115% revenue growth. So for me, this is a buy right here, okay? Now, we could see that we are officially oversold on the RSI. We're right here, almost at 30. We're at 31. The last time we saw this was back in February, where we got to a 22 RSI, and the stock went down to 95, okay? So for me, I'm stepping in here, right? I'm taking advantage. So let's take a look at the portfolio. Remember, this is not financial advice. I'm just sharing what I'm personally doing for educational purposes only. Results may vary. But what's cool about kind of how I've adjusted my strategy is that I layer in, okay? I layer into these stocks. So I'm not, you know, selling all of my cash-secured puts at one strike for one expiration. As you can see, I had one 230 put option, obviously deep in the money, kind of dipping my toes. I had the 195s, which I sold right before earnings, okay? So this was on the lower end of the expected market maker move, and the stock actually fell further than what the expectations were for the market makers, okay? And that happens sometimes. So what I did today was I just loaded up on three more cash-secured puts for the same expiration right at the money. So I went right to 170. I picked up about $1,005 per contract, right? And I did three of those because I don't mind getting assigned at 170. I'm very bullish here. Stock's well below the lower Bollinger Band, oversold on the RSI. And I want to get paid to own the shares, which effectively reduces my cost basis on these ones down to 160, okay? So if in 16 days the stock goes below 170 or stays below 170, I will get assigned those shares. But my average cost basis will now go from, you know, this first put at 230 all the way down to 189. So once that happens, okay, I will go ahead and sell, you know, a 30-day covered call at the 190 strike and pick up 550 to 600 bucks, okay? So that's basically what I'm doing on the position to lower my cost basis, and I'm actually very bullish on this stock. So that's exactly what we did there. And if we go to the bull case scenario, okay, of 275 to 310, I think it could reach those previous all-time highs. You know, by somewhere I'm eyeing by the end of year, sometime early next year, the margin dip is mixed, not erosion. Adjusted margin held at 68% and is guided to 67 to 69%. So if GAAP normalizes next quarter, the sell-off was an overreaction to a single line item, and that's what I believe. At 23 times forward earnings with 85% revenue growth and optical crossing 600 million, this is one of the cheaper ways to own AI interconnect, and every analyst who cut a target kept the rating. So that is my takeaway here. Very bullish on the stock. Seeing these kinds of overreactions just reminds me that the market is irrational, right? The market is irrational, and sometimes expectations get a bit too high. So this was a nice reset on the stock, and I'm glad to play this stock back up to previous all-time highs. So that is how I'm approaching CRDO. Let's dive into one stock that I added, a new position here, which is BE, okay, Bloom Energy. I know it's been a popular stock on YouTube, other people talking about it. For me, I wanted this stock to be positive earnings before I actually pulled the trigger, and as you can see, positive earnings. Now, it is a higher PE ratio stock, so I'm keeping it small, but it's trading, you know, well off all-time highs of 351. So it's trading about at a 40% discount. I said, you know what? I like it here. It's trading right at the VWAP, the yearly VWAP, which is institutional cost basis, and slightly above the 200-day moving average. So if I'm going to add a new stock that's a higher PE ratio stock, they have good cash, good cash on hand. I like it. I'm going to add it when it's at a discount, and this is exactly when I love to run the wheel strategy on stock. So what I did today was I opened up two BE 175 put options to collect about $1,050 there. So that's going to be BE, one thing I added today. LRCX is another one I added. I really like LRCX at these levels, 49 PE ratio. One of my puts went in the money, which is down here. My 295s went in the money. So I said, okay, let's go ahead and layer another cash secured put in at 265. So we did that, stayed a little safer, 25 delta. And if I get a sign there, cool. I'm just lowering my cost basis and getting ready for the eventual next leg up with a lot of these AI infrastructure plays. So that's LRCX. Let's talk about IREN, okay? IREN surprised me. I thought IREN was actually going to retest these lows here at 31, and it didn't. And we're seeing a lot of strength right here. A lot of, you know, buying volume stepping into their, what was called bad earnings. I know that the CEO actually made a post on X kind of clarifying their earnings. And I'm glad he did that because it did provide some clarity on where the stock is headed. So if we look at the fundamentals, okay, we are, we look at actual buying data. You could see that market makers, all right, there is a put wall at 3650. Now this is very good because the last, before earnings, their put wall was at 22. And it was a little concerning because it was like, well, you know, the stock could head down quite a ways, you know, lower, but not have any support. Now there is clear support here at 3650 according to institutional data right here. And then if we get above 4050, there could be acceleration on the upside. So that's something that I'm keeping an eye out. But what I did too was I added more yesterday to the portfolio. I added 11, so that's equivalent to 1100 shares, 32 put options, cash secured puts. So if I get assigned there, it'll lower my average cost basis from 48 all the way down to 40, including some of those put premiums. So that's why I did that. I added more to IREN because I am, you know, somewhat neutral on the stock, but I do want to lower cost basis at these good levels. So that's why I did that there. But that was good to see, you know, IREN looking pretty solid there. So my expectation, I am eyeing, if we could curl up here, make a bullish crossover on the RSI, we're getting very close. MACD is coiling upwards. Finally, potentially we could see I'm eyeing the range of anywhere from, you know, above this mid Bollinger Band line. So 40 all the way up to the upper Bollinger Band, 46. So I think that's a good value zone. And I think that's kind of where I'm eyeing in the next three to four weeks. Okay, so we're just eyeing that area. If we could get up there, great. Now, if you did enjoy this update video, please give it a thumbs up. I'll see you in the next one and take care.