Dear Momentum Options Subscriber,

Futures were slightly higher last night as I was wrapping up my weekend homework and remained that way ahead of the opening of overseas markets. However, Greece’s inability to elect a president following its third round of elections had futures lower heading into this morning’s open here in the United States.

The bulls have managed to rebound despite the hiccup at the start of trading, as the indexes have since pushed their way to higher ground.

In today’s Pre-Market Update, I listed a number of clues to watch for to confirm continued highs, but I also mentioned that some warnings signs are flashing.

At mid-day, the Dow is down 12 points to 18,041, while the S&P 500 is higher by 2 points to 2,090. The Nasdaq is advancing 2 points to 4,808, and the Russell 2000 is gaining 3 points to 1,218. The S&P 500 Volatility Index ($VIX, 15.63, up 1.13) is back above 15 with today’s 8% pop.

I would like to see a higher close for the Dow and the bulls hold the VIX below 15 into the closing bell. In the meantime, I have updated our current trades, including one position that we are taking partial profits in today and two others that we are closing entirely.

Momentum Options Play List

Closed Momentum Options Trades for 2014: 97-61 (61%). All trades are dated and time stamped so new subscribers can look at the past history to see how the trades have played out.

Do not risk more than 5% of your trading account on any one trade but do try to take all of the trades. Please remember, all “Exit Targets” and “Stop Targets” are targets. You should not have any “Hard Stops” entered to close any trades or “Exit Orders” in your brokerage account unless I list one. I will send out a “Profit Alert” or “New Trade” if I want you to close a position or if a new trade comes out. Otherwise, follow instructions at all times in the 9 a.m. and 12 p.m. – 1 p.m. updates. Also, I will usually give you a heads-up if I think I’m going to send an email outside of these time frames.

All prices given in this update are current as of 1:10 p.m. EST.

Every new Momentum Options recommendation is listed with the price at which I entered my own position. If the price is slightly different than my recommended entry or exit price when you receive the alert, don’t let that keep you from getting into or out of a trade. Occasionally, you might even get a better “fill” price than what is posted in the Open Trades and Closed Trades.

AT&T (T, $34.16, down $0.01)

T February 35 calls (T150220C00035000, $0.35, down $0.01)

Entry Price: $0.35 (12/26/2014)

Exit Target: $0.70

Return: 0%

Stop Target: None

Action: Resistance is at $34.50-$34.75. I have a near-term target of $35-$36 for the stock, which if reached will easily double these call options from current levels.

Support is at $33.75, and a drop back below this level would suggest momentum is fading. Given the recent market volatility, I like the trade as long as $33 holds.

 

Juniper Networks (JNPR, $22.75, up $0.02)

JNPR January 23 calls (JNPR150117C00023000, $0.45, flat)

Entry Price: $0.36 (12/19/2014)

Exit Target: $0.75

Return: 25%

Stop Target: $0.37 (Stop Limit)

 

JNPR April 24 calls (JNPR150417C00024000, $0.90, flat)

Entry Price: $0.81 (12/19/2014)

Exit Target: $1.60

Return: 11%

Stop Target: $0.82 (Stop Limit)

Action: Resistance remains at $23.25 and the 200-day moving average. I would like to see a close above this level this week.

Support is fresh at $22 and the 100-day moving average. There could be an early exit if $22.50-$22.25 fails to hold.

 

Boston Scientific (BSX, $13.21, up $0.04)

BSX February 14 calls (BSX150220C00014000, $0.40, flat)

Entry Price: $0.45 (12/19/2014)

Exit Target: $0.90

Return: -11%

Stop Target: None

Action: Resistance is at $13.25-$13.40. Support is at $13 and the 50-day moving average. A close below $12.75 and the 200-day moving average would be bearish.

 

Fortinet (FTNT, $31.11, down $0.20)

FTNT March 32 calls (FTNT150320C00032000, $1.60, down $0.10)

Entry Price: $1.00 (12/18/2014)

Exit Target: $2.00

Return: 60%

Stop Target: $1.25, raise to $1.45 (Stop Limit)

Action: Raise the Stop Limit from $1.25 to $1.45 to protect profits. The calls have traded to a low of $1.61 today.

Resistance is at $31.50. Support is at $29.50-$28.

 

American Express (AXP, $94.40, up $0.11)

AXP January 95 calls (AXP150117C00095000, $1.20, flat)

Entry Price: $0.60 (12/15/2014)

Exit Target: $2.00+ (closed half at $1.50 on 12/24/2014)

Return: 125%

Stop Target: $1.05 (Stop Limit)

Action: The calls have traded to a low of $1.07, and the Stop Limit is holding on the second half of the position. I would like to see shares clear $95 by Wednesday.

 

Marvell Technology (MRVL, $14.37, flat)

MRVL January 15 calls (MRVL150117C00015000, $0.20, flat)

Entry Price: $0.35 (12/11/2014)

Exit Target: $0.70

Return: -43%

Stop Target: None

 

MRVL February 15 calls (MRVL150220C00015000, $0.45, flat)

Entry Price: $0.55 (12/11/2014)

Exit Target: $1.10

Return: -18%

Stop Target: None

Action: Fresh support is at $14.25 and the 200-day moving average. Backup support is at $14-$13.75. The next wave of resistance is at $14.50-$14.75, and a close above the latter would be super bullish.

 

Pfizer (PFE, $31.45, down $0.20)

PFE February 33 calls (PFE150220C00033000, $0.30, down $0.05)

Entry Price: $0.57 (12/8/2014)

Exit Target: $1.15

Return: -47%

Stop Target: None

 

PFE March 33 calls (PFE150320C00033000, $0.40, down $0.10)

Entry Price: $0.68 (12/8/2014)

Exit Target: $1.40

Return: -41%

Stop Target: None

Action: Close both of the trades at current levels.

Today’s pullback is disappointing because I really like this trade. There is still plenty of time for a rebound and a chance the position can make a profit. However, I want to clean up the portfolio and keep only the strongest trades going into 2015. PFE has no momentum right now, but I may get back into this trade once shares clear $32.50-$33.

 

iShares Russell 2000 (IWM, $121.05, up $0.52)

IWM January 121 calls (IWM150117C00121000, $1.90, up $0.30)

Entry Price: $0.90 (12/5/2014)

Exit Target: $1.80, raise to $2.20 on the second half of the position

Return: 106%

Stop Target: $1.20, raise to $1.40 (Stop Limit)

Action: The Limit Order to close half of the trade at $1.80 has triggered.

Raise the Exit Target from $1.80 to $2.20 on the second half of the trade, but it is not a Limit Order at this time.

Raise the Stop Limit from $1.20 to $1.40.

Shares have made fresh 52-week peaks in today’s session.

 

PowerShares QQQ (QQQ, $105.11, up $0.07)

QQQ January 107 calls (QQQ150117C00107000, $0.55, flat)

Entry Price: $0.98 (12/5/2014)

Exit Target: $2.00

Return: -44%

Stop Target: None

Action: Resistance at $105 was cleared and will now try to serve as support. Continued higher closes above this level would be bullish. Support is at $103.50-$102.

 

JDS Uniphase (JDSU, $13.93, up $0.01)

JDSU March 14 calls (JDSU150320C00014000, $0.95, flat)

Entry Price: $0.70 (12/3/2014)

Exit Target: $1.40

Return: 36%

Stop Target: $0.80 (Stop Limit)

Action: A mini-trading range has formed with resistance at $14-$14.25. The 52-week peak is at $14.99. Near-term support is at $13.75. A drop below this level could lead to $13.50-$13.25 and would trigger the Stop Limit.

You can read my full update on JDSU in the Dec. 3 Alert.

 

Flextronics (FLEX, $11.35, up $0.03)

FLEX January 11 calls (FLEX150117C00011000, $0.45, flat)

Entry Price: $0.68 (9/5/2014)

Exit Target: $1.25

Return: -33%

Stop Target: None

Action: Shares are holding $11.25, and the next wave of resistance is at $11.50. Support is at $11-$10.75.

This is the last remaining trade from September, and I would like to see a run past $11.50 by Wednesday. If not, I could close the trade and look at further options to buy more time for the trade. The April 12 calls are trading at the same levels as the January 11 calls and could be an alternative.

Holiday Savings Event: The local stores have their holiday decorations up and I’m still thinking about gifts, so today I wanted to invite you to join me for a special Holiday Savings Event that I’m throwing for a limited time only. Renew your Momentum Options service today and save $200. It doesn’t matter when your subscription expires because I’ll just extend your current membership. Click here now to take advantage of this savings opportunity!

Trade on!

Rick Rouse
Editor and Chief Options Strategist
Momentum Options