Micron reports after the bell Wednesday. Mike Khouw has a trade for this. The AI trade faces a key test. None of this matters because the chart already told you what happens next three weeks ago.
Khouw probably bought some calls or sold some puts or constructed a butterfly spread that costs forty-seven cents and returns eighty-three cents if Micron closes between $94.12 and $94.89 on October 16th. He'll be right or wrong. The stock will move or it won't. Then everyone will explain why the thing that happened was obvious.
The AI trade needs a key test the way a fish needs a bicycle. Nvidia already ran from $120 to $500 and back to $380 while analysts wrote twelve thousand articles about data center spending. The chart drew a perfect head and shoulders pattern in May. Nobody cared. They were too busy reading earnings transcripts and listening to conference calls where executives say "robust pipeline" fourteen times.
Retail traders will watch Micron's report like it's the Super Bowl. They'll refresh their brokerage apps every six seconds. They'll check futures at 4:02 AM. They'll join Discord servers where a guy named CryptoKing_88 posts rocket emojis under a screenshot of a memorial day weekend price target he pulled from his f*cking colon.
The stock gapped down on September 3rd. It filled the gap on September 18th. It's consolidating near resistance. That's the whole story. Micron could report that Jensen Huang personally blessed their HBM production line and the stock will still do what the 50-day moving average says it'll do.
Mike Khouw knows this. He's trading the chart with extra steps and calling it options strategy. The only test the AI trade faces is whether retail can read a trendline without crying.
Photo by Markus Winkler on Unsplash
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