Dear Momentum Options Subscriber,

I mentioned previously that a few major earnings announcements are due to be released this week. In fact, this will be the busiest week for second-quarter earnings, with 35% of S&P 500 companies scheduled to report their numbers. I will cover a few of the major names this week, as I would like to take an earnings trade or two.

After today’s close, Crane (CR), Gilead Sciences (GILD) and Las Vegas Sands (LVS) will report earnings.

On Tuesday, 3M (MMM), Apple (AAPL), Caterpillar (CAT), Eli Lilly (LLY), Juniper Networks (JNPR), Panera Bread (PNRA), Twitter (TWTR), Under Armour (UA) and Verizon (VZ) will announce their quarterly results.

Wednesday’s action will include reports from Amgen (AMGN), Boeing (BA), Coca-Cola (KO), Dr Pepper Snapple Group (DPS), Facebook (FB), Garmin (GRMN), Hilton Worldwide (HLT), Norfolk Southern (NSC), Ryder System (R) and T-Mobile (TMUS).

Thursday’s earnings highlights will come from Aflac (AFL), Amazon (AMZN), Baidu (BIDU), ConocoPhillips (COP), Harley-Davidson (HOG), Pinnacle Foods (PF) and World Wrestling Entertainment (WWE).

Finally, AbbVie (ABBV), Bloomin’ Brands (BLMN), Cigna (CI), Exxon Mobil (XOM), Phillips 66 (PSX), Tyco International (TYC) and Xerox (XRX) will step up to the podium on Friday.

The results from these major companies will certainly help sway market direction this week, which is why I wanted to put the biggest names on the radar.

Turning our focus to the market, the action has favored the bears heading into the second half of trading. The Dow is down 95 points to 18,475, while the S&P 500 is lower by 10 points to 2,164. The Nasdaq is dipping 10 points to 5,088, and the Russell 2000 is slipping 5 points to 1,207.

I have updated our current trades below, so let’s go check the tape.

Momentum Options Play List

Closed Momentum Options Trades for 2016: 59-18 (77%). All trades are dated 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 1:05 p.m. EST.

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

 

Rambus (RMBS, $13.78, up $0.22)

RMBS September 14 calls (RMBS160916C00014000, $0.46, up $0.04)

Entry Price: $0.40 (7/22/2016)

Exit Target: $0.80

Return: 15%

Stop Target: None

Action: Resistance is at $13.75-$14. Support is at $13.25-$13 on a move back below $13.50.

 

MGM Resorts International (MGM, $23.33, up $0.14)

MGM August 24 calls (MGM160819C00024000, $0.55, up $0.05)

Entry Price: $0.74 (7/15/2016)

Exit Target: $1.50

Return: -26%

Stop Target: $0.35 (Stop Limit)

Action: Resistance is at $23.25 and the 50-day moving average, followed by $23.50-$23.75. Support is at $23-$22.75.

 

Flextronics International (FLEX, $13.04, up $0.04)

FLEX August 13 calls (FLEX160819C00013000, $0.30, flat)

Entry Price: $0.44 (7/14/2016)

Exit Target: $0.50 (Limit Order)

Return: -32%

Stop Target: None

Action: Support is at $12.75-$12.50. Resistance is at $13.25-$13.50.

 

Green Dot (GDOT, $24.16, up $0.01)

GDOT August 25 calls (GDOT160819C00025000, $0.80, flat)

Entry Price: $0.80 (7/7/2016)

Exit Target: $1.60

Return: 0%

Stop Target: None

Action: Near-term resistance is at $24.25-$24.50. The recent 52-week high is at $24.34. Support is at $23.75-$23.50 if $24 fails to hold.

 

Energous (WATT, $12.17, up $0.18)

WATT August 12.50 calls (WATT160819C00012500, $0.80, up $0.05)

Entry Price: $1.57 (6/28/2016)

Exit Target: $3.15

Return: -49%

Stop Target: $0.50 (Stop Limit)

Action: Resistance is at $12-$12.25. Support is at $11.75-$11.50 and the 50-day moving average.

 

Viavi Solutions (VIAV, $7.13, up $0.01)

VIAV September 7 calls (VIAV160916C00007000, $0.40, flat)

Entry Price: $0.55 (6/23/2016)

Exit Target: $1.10

Return: -27%

Stop Target: None

Action: Resistance is at $7.15-$7.25. Support is at $6.80-$6.75 and the rising 50-day moving average.

Trade on!

Rick Rouse
Editor and Chief Options Strategist
Momentum Options