The Big 3: NKE, CVS, CSCO

The podcast dives into three high-profile stocks—Nike, CVS, and Cisco—using technical analysis and short-term trading strategies amid a market heavily focused on NVIDIA's upcoming earnings. Don Kaufman of TheoTrade argues that despite Nike's 70% drop from all-time highs, a potential bounce near $42 could trigger a bullish call spread with a June 18 expiration. For CVS, which recently failed to break the psychological $100 level, Kaufman takes a bearish stance, deploying a defined-risk put spread targeting a drop below $90. Cisco, up 27% in a month and 82.5% over the past year, is seen as a parabolic rally nearing a wall—Kaufman bets against it with a wide $10 put spread expiring August 21, betting on a sharp pullback despite the momentum. Rick Ducat’s technical breakdowns confirm these setups: Nike shows a potential base at $42–$45 with strong volume support, CVS reveals fading momentum and a broken bullish trend, and Cisco’s chart displays a classic bull pennant after a massive gap, now vulnerable to a reversal. The episode underscores that in a volatile, AI-driven market, even the strongest performers can be prime candidates for short-term reversals. The core insight? When a stock runs too far too fast—especially on speculative momentum—traders should not ignore the risk of a sharp correction. The most contrarian move isn’t always the most profitable; sometimes, the best trade is standing in front of the freight train and betting it will derail.