Forgotten Profits Trade Setup Archive
Below you'll find Ian's setups stacked up and ordered chronologically. As this service once resided at another home, the alerts only go back to mid July. For a full track record, see the portfolio.Call Walls and Put Walls
Call Walls & Put Walls: The Options Market’s Hidden Support and Resistance
Most traders mark their charts with pivots, VWAP, or volume-by-price levels. These tools help frame support and resistance. But another force doesn’t show up on a candlestick chart unless you’re looking at open interest: options positioning. Two key elements are call walls and put walls. They’re options-driven levels that often behave like invisible ceilings and floors for price.
Call Open Interest Forms Resistance
A call wall forms at a strike price with huge call open interest. Market makers who sold those calls are short options and hedge by buying shares. As the price approaches the strike, the call delta rises, and hedgers have typically accumulated most of the stock they need. The incremental buying flow tapers right at the wall, so upward momentum often stalls—the wall behaves like resistance.
Put Open Interest Forms Support
A put wall forms at a strike with substantial put open interest. Option sellers hedge by shorting shares as the price moves down. Near the wall, the need for additional shorting slows while bargain hunters and short-covering flows appear, so the wall often acts like support.
Why Do Walls Cause Reversals?
- Hedging demand dries up: Into a call wall, the steady hedger bid that helped lift price fades. Into a put wall, steady hedger supply fades.
- Positioning psychology: Longs take profits into call walls; shorts cover into put walls. These behaviors reinforce reversals.
- Liquidity pockets: Large open interest concentrates activity at specific strikes, amplifying these effects.
When Walls Break: Why Moves Can Accelerate
If strong order flow pushes through a wall, hedging flows can flip and accelerate the move:
- Above a call wall: Short-call market makers may need to buy more stock as calls go deeper in the money—fuel for a breakout.
- Below a put wall: Short-put market makers may need to short more stock as puts gain value—fuel for a breakdown.
How to Trade Call Walls and Put Walls
- Frame the range: Identify the dominant put wall below and call wall above the current price. Expect oscillation between them, especially into expirations.
- Plan reversals: Treat call walls as resistance and put walls as support. Look for confirmation with pivots, VWAP, and tape.
- Prepare for breakouts: If price pushes through a wall on convincing volume/tape, anticipate hedging-flip acceleration.
Quick Example: TSLA $350 Calls
If TSLA trades at $345 with heavy open interest at the $350 calls, $350 becomes a likely call wall. Price often hesitates there. A clean move and hold above $350, accompanied by high volume, can trigger hedging demand and a rapid leg higher.
FAQ
Do walls always hold?
No. They’re dynamic, not guarantees. Strong order flow, catalysts, or time-to-expiry effects can overwhelm them and produce trend acceleration.
How often should I update my walls?
Check daily for near-dated expirations and weekly for further-dated chains. Shifts in open interest can move the walls.
Spirit Airlines Bankruptcy
Spirit Airlines Bankruptcy: What’s Behind the Troubles and Can It Recover?
Only months after emerging from restructuring, Spirit Airlines bankruptcy headlines are back. The airline filed for Chapter 11 protection again in August, causing shares of its parent company, Spirit Aviation Holdings (FLYY), to plummet to well under a dollar. The move highlights deep financial and operational issues that a quick turnaround last spring failed to resolve.
Why Spirit Is Struggling
The discount carrier faces multiple headwinds:
- High Costs: Operating expenses continue to exceed revenues. In the last reported quarter, costs were 118% of revenue, a recipe for persistent losses.
- Cash Burn: Spirit tapped its $275 million revolving credit line and still posted a net loss of $246 million in the June quarter.
- Competition: Rivals like Frontier and larger carriers offer low fares with better reputations, eroding Spirit’s core market share.
- Failed Merger: A proposed $3.8 billion merger with JetBlue was blocked, cutting off a critical lifeline and leaving Spirit exposed on its own.
Inside the Second Chapter 11 Filing
The company is using this fresh filing to execute what it calls a “comprehensive restructuring.” This includes renegotiating aircraft leases, scaling back underperforming routes, and realigning its fleet to focus on profitable hubs. Leadership has emphasized that flights will continue, loyalty points remain valid, and employees will be paid during the process.
Spirit Airlines Bankruptcy and Prospects for Recovery
Bankruptcy court provides tools to reduce debt and restructure obligations, but recovery isn’t guaranteed. Success depends on execution, market competition, and consumer sentiment. Travelers have increasingly demanded comfort and reliability, challenging Spirit’s ultralow-cost model. Unless the airline can balance affordable fares with improved service, profitability may remain elusive.
Can Spirit Find Its Way Back?
The latest restructuring is a chance for Spirit to right-size operations, but with rivals circling and passengers skeptical, the path forward is narrow. If management can truly cut costs and reposition the brand, the carrier may survive. But given the scale of its debt and shifting consumer expectations, the Spirit Airlines bankruptcy story may be far from over.
Tesla European Sales
Tesla European Sales Slide 34%, Yet Shares Rise on AI Momentum
New data shows that Tesla’s European sales dropped sharply in July 2025, but investor enthusiasm surrounding AI and robo-taxi innovation continues to buoy the stock. Here’s what that means for markets — and day traders.
The numbers
According to the European Automobile Manufacturers’ Association, July deliveries totaled just 8,837 vehicles, representing a 40% year-over-year decline. Through July, Tesla’s European sales are down 34% from the prior year, with only 119,013 vehicles sold, compared to 179,338 in 2024. Meanwhile, the European EV market overall grew by 34% to 186,440 units, pushing Tesla’s market share to approximately 5%, down from 11% last year.
Why investors aren’t panicking
Despite the slump in Tesla European sales, the stock traded as high as $353.55 on Thursday before easing to the $341 area. The resilience reflects investor focus on the company’s AI strategy rather than short-term vehicle volumes.
Tesla’s rollout of its robo-taxi in Austin, Texas, has captured the market’s attention. Since its October 2024 unveiling, the stock has surged 46%, adding roughly $350 billion to its market capitalization. Investors appear willing to overlook weak delivery data in favor of the long-term potential of AI and autonomy.
Implications for day traders
For traders, the divergence between fundamentals and stock performance matters. The fact that Tesla’s European sales cratered while its shares held firm suggests that newsflow is being discounted when it conflicts with the AI narrative. Here’s what to watch:
- Headline whipsaws: Expect intraday volatility when sales data hits, but watch how quickly price action reverts toward AI optimism.
- VWAP & Range Trades: Use pre-market highs and lows to frame intraday setups. Fades into VWAP often work when bad news meets resilient price action.
- AI Catalyst Trades: Robo-taxi and autonomy headlines have generated larger moves than those related to delivery numbers. Size trades accordingly.
- Relative Strength: Compare Tesla’s tape to peers like NIO, VW, and Mercedes EV units — relative weakness abroad could set up pairs trades.
What comes next
An updated Model Y and a lower-cost variant, planned for later in 2025, could help stabilize volumes. Still, until deliveries improve, Tesla’s European sales will remain a drag on fundamentals. Traders should consider whether price rallies are sustainable or if AI-driven sentiment will eventually encounter resistance.
Bottom line
The sharp decline in Tesla European sales contrasts with the stock’s strength, underscoring that investors are trading the AI story, not the delivery story. For day traders, this means staying nimble: fade overreactions, respect VWAP levels, and let the order flow tell you when the AI narrative overpowers the fundamentals.
U.S. economy expanded 3.3% in Q2
GDP Surprise: Q2 Growth Revised Up, Inflation Steady — A Trader’s Read
The Commerce Department’s second estimate shows stronger-than-first-reported momentum in Q2 as consumers kept spending and net trade dynamics flattered the headline. Below: what changed, why it matters, and how to trade it today.
At a glance
Context: H1 growth averaged ~2.1% annualized; Q1 contracted 0.5% amid the import-rush distortion. Tariff dynamics and front-loading continue to ripple through the trade components.
Lead story
In its second estimate for Q2, the Commerce Department reported that the U.S. economy expanded 3.3% in Q2 as resilient consumers offset tariff-related crosscurrents. The upward revision reflects firmer personal consumption, stronger “final sales to private domestic purchasers,” and a sizable contribution from net exports after businesses stockpiled ahead of April tariff milestones.
Why “U.S. economy expanded 3.3% in Q2” matters
- Growth beat + anchored inflation = policy optionality. With core PCE at 2.5% and headline at 2.0%, the mix argues for a “wait-and-see” Fed rather than an urgent pivot, keeping rates sensitive sectors two-way tradable.
- Domestic demand held up. The jump in final sales to private domestic purchasers suggests underlying U.S. demand remains intact, a positive tell for consumer-facing names on strong tape.
- Trade noise is real. The import collapse and export dip mechanically boosted the headline; traders should fade simplistic takes that ignore the stockpiling unwind.
Key drivers under the hood
- Consumers: Real outlays beat the first print (+1.6%), led by services; discretionary remains rotational.
- Businesses: Inventory timing and tariff planning skewed trade flows; watch for reversal effects in coming prints.
- Prices: Core PCE stuck at 2.5% keeps “higher for a bit longer” plausible, but not a headwind if yields drift lower on growth quality.
Market context
Equities tend to reward “Goldilocks-ish” combinations of steady growth and anchored inflation, but leadership rotates. Expect two-sided action as positioning adjusts to the fact that the U.S. economy expanded 3.3% in Q2 while trade components remain noisy.
Implications for Day Traders: A Playbook
Because the U.S. economy expanded by 3.3% in Q2, algorithms will focus on revisions, inflation mix, and rate-path implications. Here’s how to translate the macro into intraday tactics:
- Opening Sequence (9:30–10:10 ET): Treat the first 40 minutes as discovery. Map the pre-market high/low on SPY and QQQ and frame trades versus VWAP. Use your volatility bands to fade extensions that stall on declining delta/volume. “Gap-and-go” becomes higher probability if yields tick down while cyclicals bid.
- Consumer Rotation: On strong tape, look for relative strength in discretionary/experiential names (retail, travel, payments). Pair with a short in an import-heavy laggard if the tariffs headline-check. Trade the spread when tick/ADD diverge.
- Tariff Differential Pairs: Industrials/ag exporters can capture flows when trade mechanically boosts GDP; import-dependent apparel/retail may underperform due to margin fears. Build a quick pairs grid and trade mean-reversions around VWAP.
- Rates & USD Sensitivity: If the curve bull-flattens on “good growth + tame inflation,” mega-cap tech often outperforms. If yields back up, shift to financials/energy. Watch 2-yr yield inflections at whole/half handles as triggers.
- Net-Export Noise ≠ Trend: Expect intraday whips on headlines interpreting the trade boost as organic strength. Keep size modest into macro-headline bursts; re-add only after the 5-minute bars reclaim VWAP with rising cumulative volume.
- Options Flow (ODTE): Use SPX/QQQ gamma levels for magnets and stalls. If call gamma builds above the opening range, favor pullback buys to the 5-/9-EMA cluster. If put gamma dominates, sell bounces into a declining VWAP.
- Around-the-Horn Setups: When a strong print gaps leaders above your levels, stalk the 2SD “Baltimore Chop” for first-hour mean-revert entries; for trend days, run Fastball continuations once the opening range breaks on expanding volume.
- Risk Protocol: Keep R small during the first pullback; widen only after the session structure has declared itself (trend vs. range). Use time-based stops when news flow, not order flow, is driving prices.
What to watch next
- Revisions & inventories: Any unwind of the stockpiling effect could flip the trade contribution; be ready for narrative shifts.
- Inflation cadence: With core PCE at 2.5% and headline at 2.0%, incremental disinflation would be a tailwind for duration-sensitive risk.
- Nowcast drift: If the Q3 nowcast holds near ~2.2%, expect rotational leadership rather than a one-way “risk on/off.”
Bottom line
Data highlights cited: GDP 3.3% (second estimate), Consumer Spending +1.6%, Final Sales to Private Domestic Purchasers +1.9%, Imports −29.8%, Exports −1.3%, Net exports ≈ +5 pp contribution, Core PCE 2.5%, Headline PCE 2.0%, Atlanta Fed GDPNow ≈ 2.2% for Q3.
Nvidia Earnings Beat Expectations
Nvidia Earnings Beat Expectations, But Stock Falls
Nvidia earnings beat expectations in the company’s latest quarterly report, but shares slipped in extended trading despite the upbeat results and guidance. The chipmaker continues to dominate the artificial intelligence (AI) infrastructure market, though investor enthusiasm appears to have already priced in much of the growth story.
Headline Numbers
For the second quarter of fiscal 2026, Nvidia reported adjusted earnings of $1.05 per share, topping analyst estimates of $1.01 per share. Revenue reached $46.74 billion, beating the consensus forecast of $46.06 billion. Net income jumped 59% year-over-year to $25.78 billion.
Guidance for the October quarter was equally strong, with management forecasting revenue of $54 billion (±2%). Analysts were expecting around $53.1 billion, confirming that Nvidia earnings beat expectations both in reported results and forward outlook.
AI and Data Center Growth
The data center segment remained the growth engine, generating $41.1 billion in revenue—up 56% from the previous year. Large cloud providers accounted for about half of that business. The rollout of Blackwell chips is accelerating, with sales up 17% from the first quarter. Nvidia also noted that its new product line has already reached $27 billion in cumulative sales.
Despite geopolitical setbacks—such as the inability to ship H20 chips to China, which cost the company $4.5 billion in write-downs—Nvidia still managed to benefit from redirecting $180 million in H20 inventory to customers outside China. Even so, Nvidia earnings beat expectations without factoring in those lost sales, highlighting the resilience of its AI-driven demand.
Why the Stock Fell
While results were strong, the stock declined after hours. Traders cite “buy the rumor, sell the news” dynamics and concerns about stretched valuations as key factors. With Nvidia now central to the AI buildout, expectations are sky-high, and even strong beats can trigger profit-taking. This illustrates how Nvidia earnings beat expectations but still may not satisfy investors who anticipate extraordinary growth.
Implications for Traders
- Short-term volatility: The post-earnings drop may provide trading opportunities around support and resistance levels.
- Options trades: Elevated implied volatility around the report could create setups for straddle/strangle strategies.
- Sector sympathy moves: Semiconductor peers like AMD and TSMC often react in tandem to Nvidia’s results.
- Macro signal: Because Nvidia is central to AI infrastructure, its performance often drives broader tech and Nasdaq sentiment.
For traders, the lesson is clear: Nvidia earnings beat expectations, but sentiment and positioning matter just as much as fundamentals. Watching follow-through price action is critical.
Bottom Line
Nvidia earnings beat expectations on both revenue and profit, underscoring its dominance in AI and data center growth. Still, the stock’s post-report decline is a reminder that when valuations run ahead of fundamentals, even great news may not spark a rally. Traders should stay alert for opportunities in both Nvidia and the broader semiconductor space as the AI trade evolves.