Dear Momentum Options Subscriber,

The regular August monthly options expire at the close of trading this Friday, and today’s flat action could be in anticipation of the event. Historically, the market has fared well in the time period around August expiration, and the day has been bullish in recent years.

There are a number of high-profile earnings announcements that will be released ahead of tomorrow’s opening bell, with The Buckle (BKE), Deere (DE), Estee Lauder (EL), Foot Locker (FL) and Hibbett Sports (HIBB) set to confess their latest numbers.

I have been researching these names for a possible New Trade, but I see no reason to force the action, although Deere looks like it could be setting up for a big move north or south.

The Dow is currently down 4 points to 18,569, while the S&P 500 is higher by 2 points to 2,184. The Nasdaq is gaining 9 points to 5,237, and the Russell 2000 is gaining 6 points to 1,234.

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

Momentum Options Play List

Closed Momentum Options Trades for 2016: 62-22 (74%). 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 3:00 p.m. EST.

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

 

Energous (WATT, $14.27, up $0.20)

WATT November 15 calls (WATT161118C00015000, $2.00, up $0.20)

Entry Price: $1.65 (8/17/2016)

Exit Target: $2.40

Return: 21%

Stop Target: None

Action: Resistance is at $14.50-$15. Support is at $14-$13.75.

 

MGM Resorts International (MGM, $24.38, down $0.05)

MGM September 25 calls (MGM160916C00025000, $0.39, down $0.02)

Entry Price: $0.70 (8/8/2016)

Exit Target: $1.40

Return: -44%

Stop Target: None

Action: Support is at $24.25-$24. Resistance is at $24.50-$24.75.

 

Bank of America (BAC, $15.15, flat)

BAC September 15 calls (BAC160916C00015000, $0.38, down $0.04)

Entry Price: $0.50 (8/8/2016)

Exit Target: $1.00

Return: -24%

Stop Target: None

Action: Near-term resistance is at $15.25-$15.50. Support is at $15-$14.75.

 

Rambus (RMBS, $13.52, up $0.03)

RMBS September 14 calls (RMBS160916C00014000, $0.20, down $0.01)

Entry Price: $0.40 (8/1/2016)

Exit Target: $0.80

Return: -50%

Stop Target: None

Action: Support is at $13.50-$13.25. Resistance is at $13.75-$14.

Trade on!

Rick Rouse
Editor and Chief Options Strategist
Momentum Options