Apple and Amazon are set to report their earnings, which could significantly impact the stock market's trajectory following a rough week. Apple has seen a 25% increase year-to-date and a 7% rally since the S&P 500 peaked on June 2.
However, options traders are anticipating a larger-than-usual price movement, with implied volatility suggesting a 3.4% change post-earnings, more than double its median move of 1.5% in previous reports. Despite initial bullish sentiment, recent trading has shown a shift towards bearishness, particularly with a notable amount of call options being sold.
In contrast, Amazon's options market appears more optimistic, with traders expecting a 6.6% move after earnings, aligning closely with its historical median of 7%. Overall, the contrasting options flows for both companies indicate a cautious approach from investors as they await the earnings results