Dear Momentum Options Subscriber,
This week and the month of April have been busy for the portfolio, but I can’t wait to trade the nuances of May. While the recent pullback knocked us out of some really good bullish trades, making profits in a volatile market is what I thrive on.
I mentioned that the old Wall Street adage of “sell in May and go away” would come into play, and it’s too early to say if today’s rebound will stick. However, it’s important to keep the three-month trading ranges in mind and to ignore the short-term waffling by the talking heads to go long or short.
The chart reviews from Monday’s Pre-Market Update should have provided a better picture of what is really happening in the market. Today’s gains are keeping the indexes inside of the trading ranges, but we still have to be wary of lower lows.
Heading into the second half of trading, the Dow is gaining 124 points to 17,965, while the S&P 500 is higher by 13 points to 2,099. The Nasdaq is advancing 36 points to 4,977, and the Russell 2000 is adding 2 points to 1,222.
I have updated our current trades, so let’s go check on the action. I will be back Monday morning with the charts and a full report. Until then, have a great weekend!
Momentum Options Play List
Closed Momentum Options Trades for 2015: 46-14-1 (75%). 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 1:00 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.
Limelight Networks (LLNW, $4.08, up $0.38)
LLNW September 4 calls (LLNW150918C00004000, $0.60, up $0.10)
Entry Price: $0.35 (4/29/2015)
Exit Target: $0.70 (Limit Order on half)
Stop Target: None
Action: Shares have traded up to $4.10 today, and I would like to see $4 hold into the close.
We are still waiting to ring the register on the first half of the trade at $0.70, but hopefully it happens ahead of the close. If so, I will send out a Profit Alert.
You can read my full update on LLNW in this morning’s Pre-Market Update.
Krispy Kreme Doughnuts (KKD, $18.06, up $0.26)
KKD June 17 puts (KKD150619P00017000, $0.70, flat)
Entry Price: $0.35 (4/28/2015)
Exit Target: $1.05 (closed first half at $0.70 on 4/29/2015)
Stop Target: $0.50 (Stop Limit)
Action: The next wave of support is at $17.50-$17 if $17.75 fails to hold. Resistance is at $18-$18.25.
Opko Health (OPK, $13.94, up $0.18)
OPK June 16 calls (OPK150619C00016000, $0.35, up $0.04)
Entry Price: $0.50 (4/27/2015)
Exit Target: $1.00
Stop Target: None
Action: Resistance is at $14. Support is at $13.50. Earnings are due out next week, and I will cover them and the chart on Monday.
SunPower (SPWR, $32.12, down $0.07)
SPWR June 38 calls (SPWR150619C00038000, $0.30, down $0.15)
Entry Price: $0.95 (4/22/2015)
Exit Target: $1.90
Stop Target: None
Action: Support at $30 is holding. Resistance is at $32.50.
Dot Hill Systems (HILL, $6.51, up $0.23)
HILL September 7.50 calls (HILL150918C00007500, $0.50, up $0.05)
Entry Price: $0.45 (4/20/2015)
Exit Target: $1.35-$1.80
Stop Target: None
Action: Resistance is at $6.50-$6.75. Near-term support is at $6.25. Earnings are due out on May 7, and I will cover the company’s numbers next week.
Trades on Hold — other 2015 Portfolio Open positions (2): These are trades that are still open in the portfolio but are down over 50%. They have longer expiration dates and are on “hold” but are not worth mentioning until they turn around. This means I would not open any new positions. I’m still keeping track of the trades and will record the results accordingly when the trade closes or if the options expire. Click on the Open Trades and Closed Trades pages to see all open and closed positions.
BlackBerry (BBRY) June 13 calls (from March 2015) — This is a speculation trade from early March on BBRY receiving a takeover offer of $14 or better by mid-June — Continue to hold.
iShares Russell 2000 (IWM) May 127 calls (from April 2015) — Continue to hold.
Editor and Chief Options Strategist
P.S. A Change to our Text Message Service
Today, May 1, the number you receive our text alerts (SMS) from will be changing. The new number will be 24587. You don’t need to do anything to continue getting our text messages if you have already signed up. But if you don’t start receiving text alerts from 24587 today, you may need to contact your carrier to ask them to unblock texts from the new number.
If you don’t already receive our text alerts, we encourage you to sign up here. It is free to register, though your carrier may impose charges. And, again, be sure to have your provider remove any blocks for our number, 24587.