Pre-Market Update for 1/13/2017

All About the Banks

8:00am (EST)

The bears got a clean sweep on Thursday as the major indexes went out in negative territory ahead of this morning’s Financial earnings parade. There are four major companies reporting ahead of the opening bell and their results could sway futures one way or another. The more important news will be the weekly results and where volatility closes ahead of the weekend.

The Dow dropped 63 points, or 0.3%, to end at 19,891. The blue-chips opened at 19,926 while testing a low of 19,770 intraday. Support at 19,800-19,725 held following an all day session in the red. Resistance remains at 19,900-20,000.

The S&P 500 stumbled nearly 5 points, or 0.2%, to finish at 2,270. The index traded also traded in negative territory throughout Thursday with the bottom reaching 2,254. Support at 2,260-2,250 was split but held into the closing bell. A move below the latter would be a red flag. Resistance is at 2,275-2,300.

The Nasdaq tumbled 16 points, or 0.3%, to settle at 5,547. Tech had its seven-session winning streak snapped after kissing a low of 5,496 during the morning action. Lower support at 5,525-5,500 was breeched but held following a steady rebound the rest of the session. Resistance and fresh fluff targets are at 5,575-5,625.

The Russell 2000 gave back a 12-pack, or 0.9%, to close at 1,361. The small-caps were the weakest link after falling down to 1,346 intraday. Lower support at 1,360-1,350 was breeched and I’ve talked about the importance of this level holding throughout the week. I would like to see a close above lower resistance at 1,375-1,400 heading into the weekend.

The S&P 500 Volatility Index ($VIX, 11.54, up 0.28) stayed elevated throughout Thursday with the bears pushing a high of 12.60. Resistance at 12.50-13.50 continues to hold with a close above the latter a warning sign. Support remains at 11.50-11.

From desk to press, futures look like this: Dow (+20); S&P 500 (+2); Nasdaq 100 (+8); Russell (+2).


Momentum Options Play List

Closed Momentum Options Trades for 2017: 2-0 (100%). 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 8am and 12pm–2pm (EST) updates. Also, I will usually give you a heads-up if I think I’m going to send an Trade Alerts outside of these time frames.


Tower Semiconductor (TSEM, $20.26, down $0.11)

TSEM February 21 calls (TSEM170217C00021000, $0.70, flat)

Entry Price: $0.65 (1/11/2017)
Exit Target: $1.30
Return: 8%
Stop Target: None

TSEM February 20 calls (TSEM170217C00020000, $1.15, down $0.05)

Entry Price: $0.55 (1/3/2017)
Exit Target: $2 (closed 1/3 @ $1.10)
Return: 106%
Stop Target: $1 (Stop Limit)

Action: Thursday’s low tapped $20.05. Support is at $20-$19.75. Resistance is at $20.50-$21. Continued momentum could carry shares towards $22-$22.50.


Green Dot (GDOT, $25.00, up $0.12)

GDOT March 25 calls (GDOT170317C00025000, $1.35, flat)

Entry Price: $1.30 (1/6/2017)
Exit Target: $2.60
Return: 4%
Stop Target: None

Action: GDOT traded to a 52-week peak of $25.63 on yesterday’s open. Support is at $24.50-$24.25. Fresh resistance is at $25.25-25.50. My mid-March target is calling for a run towards $22-$22.50.


Sprint (S, $8.46, down $0.17)

S February 9 calls (S170317C00009000, $0.32, down $0.08)

Entry Price: $0.54 (1/6/2017)
Exit Target: $1.10
Return: -41%
Stop Target: None

Action: Yesterday’s low reached $8.32. Support is at $8.50-$8.25. Resistance is at $8.75-$9.


Sony (SNE, $30.87, up $0.43)

February 27 puts (SNE170217P00027000, $0.15, down $0.05)

Entry Price: $0.65 (12/23/2016)
Exit Target: $1.30
Return: -77%
Stop Target: None

Action: SNE tested a high of $30.90 yesterday. Fresh resistance is at $31-$31.50. Support is at $30-$29.50.