The shares of Urban Outfitters, Inc. (NASDAQ:URBN) have been trading in a channel of lower highs and lows since their August peak of $52.50, recently hitting an annual low of $31.15 on Friday, Feb. 1. Today, the retail stock is trading slightly higher, up 0.9% at $31.53, but just flashed a historically bearish signal, suggesting URBN's next leg lower could be just around the corner.

Specifically, the security just came within one standard deviation of its 40-day moving average after a lengthy stretch below the trendline. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, this signal has flashed 10 other times in the past three years, with URBN stock lower one month later 78% of the time. After these signals, the stock averaged a one-month loss of 6.2%. From where it currently sits, a similar move could put the equity just south of $30 -- an area not charted since November 2017. 

Bears have already started piling on the struggling stock. Short interest grew nearly 52% in the past reporting period, and the 13.04 shares currently sold short represent a healthy 16.04% of the stock's available float.

Analysts are also starting to sour on the retailer, but there's plenty of room on the bearish bandwagon. URBN currently sports 13 tepid "hold" ratings, though five still give it a "buy" or better rating, with not a "sell" to be seen. Plus, the consensus 12-month target price of $42.06 represents a 33.7% premium to current levels, and sits in an area not explored since September. Should the stock continue its southern trajectory, a round of analyst downgrades and price-target cuts could create even stiffer headwinds. 

The shares of Marinus Pharmaceuticals Inc (NASDAQ:MRNS) are popping today after Jefferies initiated coverage on the penny stock with a "buy" rating and a $10 target price -- nearly three times yesterday's close at $3.56. The brokerage firm believes the pharma company's Phase II postpartum depression data could spark a rally up to 50%, and said that the risk/reward factor is "skewed heavily towards the upside." As a result, MRNS stock is up 6% at $3.77 at last check. 

The stock has been in rebound mode of late -- up roughly 62% from its 16-month low of $2.36 on Dec. 21, helped along by its 30-day trendline. Now, MRNS is squaring up with its 100-day moving average, after briefly popping north of it in intraday action on Jan. 25. Plus, the equity is now gearing towards its third straight daily win and is tentatively expected to report earnings within the next week, which could spark even more volatility. 

Jefferies isn't the only analyst riding the bullish bandwagon. The brokerage bunch maintains four "strong buy" ratings on MRNS stock, compared to one "hold," and not a single "sell." Plus, the consensus 12-month price target of $16.75 is an impressive 344% premium to current levels.

Options bulls have targeted MRNS, too, with the stock sporting a 50-day call/put volume ratio of 16.49 on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) -- a ratio that sits in the 88th percentile of its annual range. This means that calls have been bought to open over puts at a much quicker clip than usual. 

In the front-month series, the March 5 call is home to peak open interest of nearly 1,800 contracts. Data from the major options exchanges confirms notable buy-to-open activity here, suggesting options traders are eyeing a breakout above $5 by expiration at the close next Friday, March 15.

 

Just a few short weeks ago, the majority of American Association of Individual Investors (AAII) respondents considered themselves bearish on the stock market. However, in the wake of the epic 2019 rally thus far, AAII bears have gone into hibernation, now accounting for just 20% of respondents. That's a bearish exodus Wall Street hasn't seen since 2009, according to Schaeffer's Quantitative Analyst Chris Prybal. Here's what that could mean for the S&P 500 Index (SPX), if history is any indicator.

Specifically, in the week ended Feb. 28, AAII bearish respondents -- defined as individual investors who feel the stock market will move lower in the next six months -- dropped another 5.4 percentage points, to 20%. That marks the lowest reading since Jan. 3, 2018. Bullish respondents make up 41.6% of AAII investors, and the other 38.4% of respondents are neutral. The bulls-minus-bears line is at 21.6%, which is the highest since June 2018.

As alluded to earlier, the last time AAII bears went from at least 50% to 20% in a 10-week span was in May 2009, shortly after the March 2009 bottom. Prior to that, you'd have to go back to mid-2005 for such an exodus of bearish investors. Since 1990, there have been just eight of these sentiment signals (considering only one signal per month).

S&P 500 returns after these signals are in line with or slightly below the norm, until you get one month out. A month after AAII bears go into hiding, the SPX was up 1.5%, on average, and higher 71% of the time. That's nearly double the average anytime one-month return of 0.7%, with a win rate of 62%. Six months later, the index was up a slightly better-than-usual 4.7%, and one year later, the SPX was up a whopping 12%, on average, and higher 86% of the time. For comparison, since 1987, the SPX has averaged an annual gain of just 8.8%, with a 78% positive rate.

In conclusion, the sudden rush of optimism that's accompanied the 2019 rally in stocks might now unwind in the form of a slower, choppy few weeks --  particularly with the likes of S&P 2,800 nearby. However, while the sample size is relatively small, history indicates stocks could extend their journey higher in the second quarter and beyond.

Hertz Global Holdings Inc (NYSE:HTZ) stock is down 13.5% today at $17.29, after a Securities and Exchange Commission (SEC) filing revealed Carl Icahn cut his stake in the car rental name to 28.91% from 35.27%. This follows yesterday's after-the-close buzz that Morgan Stanley re-offered 5 million HTZ shares for $19.60-$19.65 -- a discount to Monday's close at $19.99.

Today's drop has sparked a rush of activity in Hertz's options pits, with roughly 13,500 puts and 4,300 calls on the tape so far -- 10 times what's typically seen at this point in the day. The March 19 put is most active, though it looks like most of the activity here is tied to stock. Elsewhere, some traders may be buying to open the March 15 puts, betting on a bigger sell-off through front-month expiration at next Friday's close.

Today's accelerated put volume echoes the broader trend seen at the major options exchanges. Specifically, HTZ stock's 10-day put/call volume ratio of 3.01 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks in the 74th annual percentile, meaning puts have been bought to open over calls at a faster-than-usual pace.

While it's possible that some of this put buying could be a result of shareholders protecting paper profits with an options hedge, skepticism is seen elsewhere on Wall Street. For instance, short interest rose 3.8% in the most recent reporting period to 21 million shares -- more than one-quarter of the stock's total available float. Plus, all five covering analysts maintain a "hold" or "strong sell" rating on HTZ.

Looking at the charts, Hertz Global stock's rally off its late-December lows near $13 peaked at a six-month high of $21.95 on Feb. 26, a familiar ceiling for the shares since last May. And while today's drop has the security pacing for its biggest one-day loss since Oct. 24, it's finding a foothold in the $17.10-$17.30 region, home to its 30-day moving average, a trendline connecting higher lows since Christmas Eve, and last month's pre-bull gap levels.

The Dow is marginally higher today as investors await fresh U.S.-China trade developments. Among stocks making notable moves today, video game maker Electronic Arts Inc. (NASDAQ:EA) and electric car concern Tesla Inc (NASDAQ:TSLA) are lower, while BioNano Genomics Inc. (NASDAQ:BNGO) is higher. Here's a quick look at what's moving the shares of EA, TSLA, and BNGO today.

Cowen Unsure About "Apex Legends" Long-Term Impact

Electronic Arts stock is down 1.5% to trade at $95.82, after Cowen highlighted Twitch viewership data that suggested interest in battle royale game "Apex Legends" was falling. The brokerage firm also believes it's "too early to make a call on how big it will be, or its staying power." Despite the pullback today, EA has found support at its 30-day moving average, and still boasts a 21% lead year-to-date.

Short sellers have started to come out of the woodwork. Short interest nearly doubled in the most recent reporting period to 11.85 million shares, the most since December 2016. However, this still represents a slim 4% of EA's total available float. 

Barclays Bear Note Still Weighing on TSLA

At last check, Tesla stock was down 1.3% to trade at $281.58. While the company reached a resolution with Chinese customs over the clearance of imported cars, a price-target cut from Barclays to $192 from $210 is still weighing on the shares. In the note, the analyst in coverage asserted that Tesla will not be the "next Apple," as many are hoping.

TSLA is heading toward its third straight loss, but pared most of the damage from its five-month session lows near $270. Year-to-date, Tesla stock is down 15.6%. 

Options traders are out in droves today, with more than 319,000 options on the tape -- two times the expected amount and volume pacing in the 96th percentile of its annual range. The weekly 3/8 series accounts for eight of TSLA's 10 most active options, with the 300-strike call seeing the heaviest attention and new positions are being initiated here.

Upbeat Study Results Power BNGO Rally

BioNano Genomics stock is up 9.5% at $4.48, one of the best stocks on the Nasdaq today. The medical device maker is soaring after the company's optical mapping technology to examine human genomes produced promising results in a study. BNGO earlier traded as high as $6.24, but has since pared those gains and fallen below its 50-day moving average. Despite the outburst today, the stock shed 36% from its Sept. 21 opening day of trading, culminating in a record low of $3.50 a month ago. 

Analysts are quite bullish on BNGO though. The two brokerages in coverage rate the stock a "buy" and their average 12-month price target of $11.50 is a 157% premium to its current perch.

Revlon Inc (NYSE:REV) stock is selling off today after brokerage firm Jefferies pointed out data from Nielsen showing worsening sales for the cosmetics company. REV shares are trading down 17.7% at $21.05, set for its first close below the 200-day moving average since August, and options volume is running at an accelerated pace.

At last check, it was actually call volume that was leading the way, with roughly 800 contracts crossing so far, compared to an average daily volume of just 54. Most popular by a mile is the April 22.50 call, where data points to buy-to-open activity. If so, these traders would be betting on a rebounding from REV stock in the weeks ahead.

One group that's certainly cheering today's sell-off is short sellers. These bears control one-third of Revlon's float, and it would take them almost eight weeks to cover their positions, based on average daily trading volumes. Of course, today's sell-off has REV on the short-sale restricted list.

Match Group Inc (NASDAQ:MTCH) stock hit a record high of $60.91 on Feb. 7 -- almost doubling its Nov. 20 low of $31.69 in little over a two-month time frame. The online dating concern has subsequently taken a breather on the charts, but the pullback could be a buying opportunity, if recent history is any indicator.

MTCH just came within one standard deviation of its 40-day moving average, after an extended period above the trendline. This signal has flashed eight other times, according to data from Schaeffer's Senior Quantitative Analyst Rocky White. The security was positive one month after half of these signals, averaging a 5.7% gain. At the stock's current perch of $55.11, a similar move would place it just below its February peak at $58.25. 

Short interest is on the decline, down 12.3% in the last two reporting periods, but the 16.63 million shares sold short still represent a healthy 32.5% of the stock's available float. It would take over a week to buy back these bearish bets, at MTCH stock's average pace of trading, leaving the door open for a short squeeze lending additional tailwinds. 

Plus, MTCH options are still relatively inexpensive, too. Match stock's Schaeffer's Volatility Index (SVI) of 40% sits higher than only 5% of all other readings in the past year. This indicates that now might be an attractive time to speculate with near-term options on the equity's next leg higher. What's more, the security's Schaeffer's Volatility Scorecard (SVS) stands at 96 out of a possible 100, indicating MTCH has exceeded options traders' volatility expectations in the past year.

Another retailer ready to take the earnings stage this week is Abercrombie & Fitch Co. (NYSE:ANF), scheduled to report fourth-quarter results before the market opens tomorrow, March 6. Below we will dive into the stock's performance, and take a glance at what the options market is pricing in for ANF's post-earnings trading.

Abercrombie & Fitch shares have struggled to gain momentum since their late-August bear gap, specifically running into a ceiling of resistance at the $22 mark -- in spite of the supportive 40-day moving average. Despite currently trading down 1.9% at $21.21, ANF is clinging to year-over-year gains of 5%.

Moving onto ANF's earnings history, the stock tends to make extremely volatile post-earning swings, of which six have been positive over the past eight quarters. This includes an 21% surge in November. On average, the shares have swung 15.3% the day after earnings, regardless of direction. This time around, the options market is pricing in a larger-than-usual 21% move for Wednesday's trading.

Call options traders have been circling ANF ahead of the impending earnings report. For example, during the past 10 trading days, data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows the security with a ratio of 7.93, ranking in the highest annual percentile.

Echoing this, Abercrombie stock's Schaeffer's put/call open interest ratio (SOIR) of 0.58 lands in the 28th annual percentile. In other words, near-term options traders are more call-biased than usual right now.

The shares of Puma Biotechnology Inc (NASDAQ:PBYI) are up 40% at $39.10 in early trading, after the drugmaker announced better-than-expected revenue for the fourth quarter. The company also reported sales of its breast cancer drug, Nerlynx, that beat analysts' expectations. The stock is now pacing for its best day since July 2014. 

Today's pop could close PBYI's Nov. 2 bear gap, too -- a drop that caused the equity to hit a six-year low of $17.60. The stock has since more than doubled, and today could take out its 200-day moving average for the first time since early 2018. 

In the wake of Puma's rally, several analysts have already raised their price targets, including Cantor Fitzgerald (to $57), J.P. Morgan Securities (to $27), and RBC (to $37). The consensus 12-month target price of $40 is just a stone's throw from current levels, suggesting more price-target hikes could ensue. Plus, prior to today, six of the eight analysts following the pharma name issued a "hold" or worse rating, which could leave the door open for upgrades. 

PBYI stock could enjoy some additional tailwinds as option bears begin to hit the exits, too. On the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock sports a 10-day put/call volume ratio of 1.02 that sits in the 88th percentile of its annual range. This means that in the past two weeks, puts were bought over calls at a much faster pace than what is typically seen.

The shares of Maxar Technologies Inc (NYSE:MAXR) are down 23.4% at $5.60, after the space technology firm said it was cutting 4% of its workforce -- more than 200 positions -- as part of a broader restructuring plan. The company also reported weak fourth-quarter results, lowered its dividend payment, and said it's restructuring its geostationary orbit satellite business.

Analyst reaction has been swift, with CIBC downgrading the stock to "underperform" from "neutral," and lowering its price target to $5 from $6. MAXR's price target was also dropped at Raymond James (to $20) and Canaccord Genuity (to $8), with the latter brokerage firm noting, "Those thinking that this strategic review could potentially provide some relief for the company’s highly levered balance sheet will likely be disappointed," and that it's "challenging to recommend the stock" "at the moment.

More broadly speaking, the majority of the five covering brokerage firms are skeptical of the equity, though two still maintain a "buy" or better rating. However, the average 12-month price target of $12.19 is a stiff premium to current trading levels, suggesting more price-target cuts could come down the pike.

And while short sellers are sidelined today with MAXR on the short-sale restricted list, they've been in the drivers seat on a stock that was already down 39% year-to-date heading into today's trading. Short interest jumped 19.1% in the two most recent reporting periods to 6.2 million shares, representing 10.7% of the stock's available float.

 

VMware, Inc. (NYSE:VMW) is a hot stock on Wall Street right now. The security is up 5.5% to trade at $181.25, and earlier nabbed a fresh record high of $183.41, after the virutalization name reported fourth-quarter earnings and revenue that exceeded analyst expectations. Six price-target hikes have already come in, including one to $203 from $196 at Jefferies, which said VMW's growth is "sustainable."

VMW closed out February with only three negative closes and a 13.7% gain. The shares have yet to post a weekly loss in 2019, and another weekly win this week will make it 10 in a row, the most on record. Plus, pullbacks like the equity saw yesterday -- which snapped a 13-day win streak -- have been contained by its 10-day moving average. Going back further, the stock is up 57% year-over-year. 

There could be room for more bull notes, too. Of the 22 brokerages covering VMW, nine rate it a "hold" or "strong sell," while its consensus 12-month price target of $178.80 is a discount to current trading levels. 

As discussed earlier this week, options traders had been showing bearish tendencies in recent weeks -- which could create tailwinds for the stock on an potential unwind. Now might be an attractive time to bet on VMware's next leg up with options, with the uncertainty of earnings out of the way. At last check, the equity's 30-day at-the-money implied volatility was perched at 26.7%, in the 11th annual percentile, meaning near-term options are relatively cheap at the moment. 

The shares of Gap Inc (NYSE:GPS) are up nearly 17% at $29.68 in this morning's trading, pacing toward their biggest one-day gain since Nov. 21, 2008, when they popped 27.2%. The surge comes after the company reported a fourth-quarter earnings beat -- though revenue fell slightly short of the consensus estimate -- and revealed plans to spin off its Old Navy business. 

This is part of the retailer's broader rebranding initiative, which also includes plans to close 230 Gap stores -- and follows a 5% drop in global same-store sales last year. Gap, Athleta, Banana Republic, Intermix, and Hill City will continue to operate under a singular umbrella company, which has yet to be named. Chairman of the Board Robert Fisher said the move was necessary because "each company now requires a different strategy to thrive moving forward."

GPS had been in a long-term downtrend heading into today's trading, with rebound attempts continually failing at the stock's 50-day and 80-day moving averages since a late-August bear gap. However, the stock has sliced through both of these trendlines today, and is pacing toward its highest close since Sept. 5.

Digging deeper, Gap stock has Schaeffer's put/call open interest ratio (SOIR) of 2.33 lands in the 93rd percentile of its annual range. This suggests that near-term options traders are more put-biased than usual right now, with the equity's March 26 put currently home to peak open interest of 17,057 contracts.

And today, amid accelerated options activity -- 45,000 contracts have traded already, 23 times what's typically seen -- speculators appear to be initiating new put spreads at the April 25 and 28 strikes. Trade-Alert suggests this is activity reflects traders' expectations that GPS will retreat back to $25 by April options expiration.

Ahead of today's news, analysts were wary toward the retailer. As of last night's close, 13 of the 15 following brokerage firms carried a "hold," "sell," or "strong sell" rating. This morning, however, no fewer than five brokerages have lifted their price targets, with Telsey Advisory being the most generous, handing out a hike to $40 from $34 -- a 35% premium to Gap's current price.