Monday’s Vital Data: GoPro, Facebook and Bank of America

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U.S. stock futures are hovering just above breakeven this morning. Fears of an escalating trade war with China are battling with another round of corporate earnings this week.

Wednesday’s Vital Data: Tesla, Micron Technology and Electronic Arts

Against this rocky backdrop, futures on the are down 0.21%. Furthermore, futures are off 0.28% and futures are down 0.05%.

On Friday, China announced $60 billion in tariffs on U.S. products. The move came in response to the U.S.'s planned 25% tariffs on $200 billion of Chinese imports.

Against this backdrop, futures on the Dow Jones Industrial Average are down 0.02% while S&P 500 have lost 0.01%. Nasdaq-100 futures, meanwhile, have dropped 0.04%.

In options activity, volume backed off considerably on Friday, arriving in a more normal range for this time of year. Overall, about 17.9 million calls and 13.7 million puts changed hands on the session. Over on the CBOE, the single-session equity put/call volume ratio dropped to 0.56. The 10-day moving average ticked lower to 0.63.

Options traders took aim at better-than-expected results from GoPro (NASDAQ: GPRO ) with heavy put activity. Meanwhile, Facebook (NASDAQ: FB ) is beginning to see signs of life after last month's 21% post-earnings plunge. Finally, profit taking is sweeping Bank of America's (NYSE: BAC ) options pits as the shares battle technical resistance.

Let's take a closer look:

GoPro Inc. (GPRO)

GoPro surprised investors on Friday with better-than-expected quarterly earnings results. The company said it lost 15 cents per share on an adjusted basis, topping expectations for a loss of 22 cents per share. Additionally, CEO Nick Woodman told investors in a conference call that "GoPro will be profitable in the second half of 2018."

GPRO stock rallied more than 17% on the news, but options traders aren't buying it. Volume soared to 252,000 contracts, or more than 26 times GPRO's daily average. Puts made up 81% of the day's take, as the bears bet heavily against the stock's staying power.

According to data , the August and January 2019 $7 put strikes were among the most popular contracts on Friday, with the January 2019 $7 strike put adding more than 110,000 contracts alone.

Facebook (FB)

It was just a matter of time before the bulls started creeping back into FB stock, and that appears to have begun in earnest on Friday last week. FB was hammered last month on growth concerns, despite offering up better-than-expected quarterly results. Now, analysts are chiming in that Facebook's selloff is a buying opportunity, including a bullish note from MKM Partners .

Options traders are also beginning to put faith back in FB stock. On Friday, volume rose to 385,000 contracts, with calls claiming 61% of the day's take. This ratio still remains below FB's average daily call percentage in the 64th percentile range, but it's a vast improvement over bearish readings taken just a week prior.

That said, FB sentiment still has a ways to go before it can be called bullish again. For instance, the September put/call open interest ratio for FB stock currently rests at 0.92, with puts on the verge of parity with calls. Look for this reading to improve as FB stock continues it's slow rebound from a record plunge.

Bank of America (BAC)

It appears that sentiment is moving in exactly the opposite direction for BAC stock. Shares in the banking giant have rallied nearly 16% since the beginning of July, but that momentum appears to be fading. BAC stock is once again faced with resistance in the $31.50 region, and is close to forming a double-top.

Options traders appear to have picked up on some warning signs of a short-term reversal for BAC. Friday's volume soared to over 353,000 contracts, with calls claiming 82% of the day's take.

Typically, this level of call activity would be bullish for a stock. However, data indicates that most of this activity was of the sell-to-close variety. Roughly 122,000 contracts traded at the August $31.50 strike on Friday, which saw open interest fall by 35,000 contracts.

In other words, traders are taking profits while they can with BAC closing a penny north of $31.50. This activity could be a sign of an impending reversal for the shares.

As of this writing, Joseph Hargett did not hold a position in any of the aforementioned securities.

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The post Monday's Vital Data: GoPro, Facebook and Bank of America appeared first on InvestorPlace .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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