Dear Momentum Options Subscriber,
With today’s push towards lower lows, the bears are in familiar territory, and the market’s support levels from September are now back in play. Today’s close should provide additional, crucial details as to whether the August lows will be tested or if current support levels hold and a rebound is in store for next week.
I mentioned yesterday that my watch list is exploding with new ideas, and I’m still working on a detailed update for Lattice Semiconductor (LSCC). I’m a one-man band, and I’m juggling a number of technical and fundamental research projects at the moment. However, I love what I do and, because you are riding shotgun with me, here is a peak at 10 of the names I have on the board for potential trades.
On the bearish side, I’m looking closely at Freeport-McMoRan (FCX), Chicago Bridge & Iron Company (CBI), Nucor (NUE), the SPDR Gold Shares ETF (GLD) and the iShares Silver Trust ETF (SLV).
On the other hand, I’m considering Cisco Systems (CSCO), Leggett & Platt (LEG), the PowerShares QQQ ETF (QQQ), Vuzix (VUZI) and Tri-Continental (TY) for possible bullish trades.
I plan to open three to five trades over the next three trading sessions, including today. I’m just waiting to see if support holds or if we get the buy signal I’m looking for, as it is possible that the market could get a positive Friday session despite today’s action. If so, the rest of the month could see a run to record highs. If not, things could get spooky for the remainder of October.
The Dow is currently down 78 points to 18,066, while the S&P 500 is losing 9 points to 2,129. The Nasdaq is falling 32 points to 5,206, and the Russell 2000 is lower by 9 points to 1,217.
Stay close to your email inboxes in case I take action this afternoon. In the meantime, I have updated our current trades and made some parameter adjustments to our position in Finisar (FNSR) below, so let’s take a look.
Momentum Options Play List
Closed Momentum Options Trades for 2016: 74-28 (73%). 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 1:15 p.m. EST.
I hereby disclose that I will be participating in the following trade(s).
Finisar (FNSR, $29.21, down $0.67)
FNSR November 31 calls (FNSR161118C00031000, $0.75, down $0.17)
Entry Price: $1.28 (10/10/2016)
Exit Target: $2.60
Stop Target: $0.60, lower to $0.30 (Stop Limit)
Action: Lower the Stop Target from $0.60 to $0.30 and make it a Stop Limit order.
Support is at $30-$29.50. Resistance is at $30-$31.50.
You can read my detailed write-up on FNSR in the Sept. 22 Mid-Market Update.
Lattice Semiconductor (LSCC, $6.09, down $0.20)
LSCC December 7.50 calls (LSCC161216C00007500, $0.20, down $0.15)
Entry Price: $0.30 (10/12/2016)
Exit Target: $0.60-$0.90
Stop Target: None
Action: Near-term support is at $6.00 and the 50-day moving average. Resistance is at $6.50-$6.60.
Apple (AAPL, $116.68, down $0.66)
AAPL November 125 calls (AAPL161118C00125000, $0.94, down $0.07)
Entry Price: $1.10 (10/11/2016)
Exit Target: $2.20
Stop Target: None
Action: Resistance is at $118.75-$119. Support is at $116-$115.
Viavi Solutions (VIAV, $7.30, down $0.13)
VIAV December 8 calls (VIAV161216C00008000, $0.24, flat)
Entry Price: $0.51 (8/19/2016)
Exit Target: $1.05
Stop Target: $0.05 (Stop Limit)
Action: Support is at $7.25-$7.15. Resistance is at $7.45-$7.50.
Editor and Chief Options Strategist