Hey Trader,

There’s been so much happening in the market over the last two weeks, it may feel impossible to know what to look at.

My answer, as always, is to turn to Big Money, to see what they’re trading, and where they’re putting their money.

And recently, I’ve been seeing some interesting Big Money moves in a sector that warrants a little extra attention …

Simply because of how much of a role it plays on the global stage.

A sudden crash for these stocks could wreak havoc on the global economy as a whole.

Which makes these bearish Big Money moves worth paying attention to …

The first Big Money moves that caught my attention last week weren’t necessarily individual trades …

So much as heavy, heavy put volume targeting Credit Suisse (Ticker: CS):

The March 7-strike puts saw nearly 59,000 contracts traded, while the April 7-strike and 8-strike puts saw 16,451 and 11,816 contracts respectively.

On the Thursday that these trades were made, CS closed down 4.4% at $7.35, though the Swiss bank has since staged a recovery, closing on Wednesday at $7.98.

There has also been some big bears targeting Deutsche Bank (Ticker: DB):

On Thursday, March 10, more than 21,000 contracts of the DB March 10.5-strike puts traded, with DB closing at $10.74, down 1.2% on the day, and down more than 35% from its late-February peak. 

However, that closing price actually represented an upside from DB’s low of $9.46 touched a few days earlier, and like CS, the German bank has seen some additional upside in recent days, closing on Wednesday at $12.21.

However, bearish attention hasn’t evaporated, and on Monday we saw a notable Big Money move that doesn’t bode well for DB in the weeks ahead.

Just days after DB promised to wrap up its Russian dealings, this trader purchased 9,076 contracts of the April 10-strike puts for $0.51, spending a total of $462,876.

What’s with the bearish attention?

European bank stocks were hit hard by the Russia/Ukraine war, as investors weighed the consequences of sanctions against Russia, as well as the potential for the sudden crisis to reduce prospects of interest rate hikes, which typically bode well for banks.

CS and DB are also among the banks in Europe with the highest exposure to Russia, with CS having a gross credit exposure of approximately $1.69 billion at the end of 2021, and with DB’s exposure amounting to approximately $3.2 billion.

DB made headlines during the early days of the conflict by insisting they would continue to serve their clients in Russia as usual, though just last week the bank backtracked on their stance, and instead said they were “in the process of winding down” their Russian affairs, and would not be conducting any new business.

And even though DB has seen strong performances in recent days, the put volume isn’t evaporating just yet.

The standard April expiration is home to three of DB’s top seven open interest positions, all three of which are puts:

And in fact, overall DB put open interest is currently at 191% of its normal amounts, compared to call open interest, which is at 108% of its usual.

Why do we care what Big Money thinks about Big Banks? 

Simply put, if European banks are in trouble … we’re all in trouble.

Floundering European banks are not only bearish for European banks, but they are an ominous sign for the market as a whole. 

So keeping an eye on the Big Money flows in these banks can give us important clues about what may be coming our way.

Remember, Big Money, aka Smart Money, often has millions of dollars they’re able to pour into research, trading tools, and expert consultations.

By watching what Big Money is doing, we’re able to harness their expensive knowledge for our own trading profits.

I’ve been using Big Money to score wins for years now … and now you can, too.