Dear Momentum Options Subscriber,

The bulls ended a two-session Monday skid to push fresh all-time highs on the Nasdaq and Russell 2000. The Dow and S&P 500 made solid gains as well and are back on track to test their record highs this week on continued momentum.

The Dow advanced 104 points, or 0.6%, to finish at 18,119. The blue-chips traded in positive territory throughout the session, with the high checking in at 18,181. Resistance at 18,200 held, and there’s upside fluff to 18,350-18,500. Support is at 18,000-17,900, with risk to 17,600 on a close below 17,800.

The S&P 500 added 13 points, or 0.6%, to end just below 2,123. The index traded to a peak of 2,129 but missed holding the upper end of resistance at 2,115-2,125. The all-time high is at 2,135, with breakout potential to 2,150-2,160. Support is at 2,100-2,090 on a pullback.

The Nasdaq jumped roughly 37 points, or 0.7%, to settle at 5,153. Tech traded to a fresh all-time high of 5,162 while holding the 5,150 level. The move above this level keeps 5,200-5,250 in play. Support continues to look good at 5,100-5,075.

The Russell 2000 soared almost 8 points, or 0.6%, to close at 1,292. The small-caps opened at 1,290 and reached another record high of 1,293 intraday. I have talked about a short-term run past 1,300 coming as long as near-term support at 1,280-1,275 holds.

The S&P 500 Volatility Index ($VIX, 12.74, down 0.22) deflated 8% while trading to a low of 12.43. The bulls failed to hold the 12.50 level to confirm higher highs on the S&P, but they did come close. The bears will be gunning for a move back above 13.50-15 this week.

From desk to press, futures look like this: Dow (+34); S&P 500 (+5); Nasdaq 100 (+12).

Momentum Options Play List

Closed Momentum Options Trades for 2015: 65-20-1 (76%). 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 8:00 a.m. EST.

I hereby disclose that I will be participating in the following trade(s). 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 portfolio.

 

S&P 500 SPDR ETF (SPY, $211.89, up $1.08)

SPY July 200 weekly puts (SPY150710P00200000, $0.24, down $0.23)

Entry Price: $0.45 (6/19/2015)

Exit Target: $0.90-$1.20 (Limit Order at $0.90 on first half)

Return: -47%

Stop Target: None

Action: Resistance at $213. A close below $210 and the 50-day moving average would be bearish. Additional help is at $208 and the 100-day moving average.

You can read my full update on SPY and view the chart work in the June 22 Pre-Market Update.

 

Rambus (RMBS, $15.01, up $0.03)

RMBS August 16 calls (RMBS150821C00016000, $0.50, flat)

Entry Price: $0.55 (6/19/2015)

Exit Target: $1.40

Return: -9%

Stop Target: None

Action: Support is at $14.50 and the 50-day moving average on a drop below $14.75. Resistance is at $15.25-$15.50, and a close above the latter would be bullish.

You can read my full update on RMBS and view the chart work in the June 22 Pre-Market Update.

 

Microsoft (MSFT, $46.23, up $0.13)

MSFT July 47 calls (MSFT150717C00047000, $0.50, flat)

Entry Price: $0.73 (6/18/2015)

Exit Target: $1.50

Return: -32%

Stop Target: None

Action: Monday’s high touched $46.72. Resistance is at $47-$48. Support is at $45.50-$45 and the 50-day moving average.

 

United Parcel Service (UPS, $101.39, up $0.55)

UPS July 105 calls (UPS150717C00105000, $0.35, up $0.05)

Entry Price: $0.53 (6/11/2015)

Exit Target: $1.05

Return: -34%

Stop Target: None

 

UPS October 110 calls (UPS151016C00110000, $0.54, up $0.04)

Entry Price: $0.70 (6/11/2015)

Exit Target: $1.40

Return: -23%

Stop Target: None

Action: Shares traded up to $101.68 on Monday. Resistance is at $102. Support is at $101 and the 200-day moving average, followed by $99 and the 100- and 50-day moving averages.

You can read my extended write-up on UPS in the June 12 Pre-Market Update.

 

Wells Fargo (WFC, $57.91, up $0.86)

WFC July 60 calls (WFC150717C00060000, $0.16, up $0.04)

Entry Price: $0.20 (6/5/2015)

Exit Target: $0.50

Return: -20%

Stop Target: None

Action: Resistance is at $58. Support is at $56.50-$56 on a close below $57.

 

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.

Sony (SNE) July 33 calls (from 6/1/2015) — Shares reclaimed $30 on Monday — Continue to hold.

Rigel Pharmaceuticals (RIGL) September 5 calls (from 6/4/2015) — Shares zoomed 12% on Monday to close at $3.45. This type of movement usually indicates that news is forthcoming — Continue to hold.

Trade on!

Rick Rouse
Editor and Chief Options Strategist
Momentum Options