MomentumOptions.com Pre-Market Update for 1/27/2017
Blue-Chips Keep Momentum/ Profit Alert (GDOT)
Thursday was a mixed with the blue-chips showing continued strength while the other major indexes took a breather. The nervousness could continue today as the weekend approaches and January winds to a close. Volatility stayed subdued but remained a hot topic to the pretenders that call themselves experts on the VIX. Earnings after yesterday’s close could impact today’s action and possibly providing us with another New Trade.
The Dow gained 32 points, or 0.2%, to finish at 20,100. The blue-chips held positive territory for much of the session aside from a one-point slip while reaching a lifetime intraday peak of 20,125. Fresh resistance remains at 20,200-20,350. Support is at 19,900-19,800.
The S&P 500 slipped nearly 2 points, or 0.2%, to settle at 2,296. The index traded in a tight 6-point range with the bulls pushing a record high of 2,300.99 shortly after the open. Lower resistance at 2,300-2,325 was tagged but failed to hold. Near-term support is at 2,280-2,275.
The Nasdaq dipped a point, or 0.02%, to close at 5,655. Tech made a record run to 5,669 on the open to keep fresh resistance at 5,700-5,750 in the mix. Short-term support at 5,600-5,575 easily held following the pullback to 5,647.
The Russell 2000 gave bak 6 points, or 0.5%, to end at 1,375. The small-caps managed a 2-point trip to 1,384 at the start of trading with resistance at 1,385-1,400 holding. Support at 1,370-1,365 easily held following the backtest to 1,374.
The S&P 500 Volatility Index ($VIX, 10.63, down 0.18) tested a high of 11.01 intraday with lowered resistance at 11-11.50 holding. The late low to 10.60 continued to push 10 and single-digits.
We got some nice pin action yesterday with our GDOT call options as shares made a major midday surge.
From desk to press, futures look like this: Dow (-4); S&P 500 (-1); Nasdaq 100 (+2).
Momentum Options Play List
Closed Momentum Options Trades for 2017: 4-0 (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.
Viavi Solutions (VIAV, $9.10, up $0.08)
VIAV March 9 calls (VIAV170317C00009000, $0.55, up $0.05)
Entry Price: $0.50 (1/25/2017)
Exit Target: $1.00
Stop Target: None
Action: Yesterday’s high reached $9.20 with the recent 52-week peak at $9.40. Short-term support is at $9-$8.75. Resistance is at $9.25-$9.50. I will cover the company’s upcoming earnings on Monday.
TherapeuticsMD (TXMD, $5.77, flat)
TXMD June 7.50 calls (TXMD170616C00007500, $0.70, flat)
Entry Price: $0.75 (1/18/2017)
Exit Target: $1.50
Stop Target: None
Action: Shares trades to a high of $5.97 yesterday. Near-term resistance is at $5.75-$6. Support is at $5.25-$5. Volume was heavy in these options on Thursday.
Transocean (RIG, $15.18, down $0.12)
RIG March 17 calls (RIG170317C00017000, $0.37, down $0.03)
Entry Price: $0.66 (1/13/2017)
Exit Target: $1.35
Stop Target: None
Action: Support is at $15-$14.75. Resistance is at $15.50-$15.75.
Tower Semiconductor (TSEM, $21.35, down $0.09)
TSEM February 21 calls (TSEM170217C00021000, $1.00, down $0.05)
Entry Price: $0.65 (1/11/2017)
Exit Target: $1.50 (Limit Order on half)
Stop Target: 90 cents (Stop Limit)
Action: The Stop Limit at 90 cents held yesterday as the puts kissed 93 cents. These are February options and if we are stopped out, we can possibly look into March options. If triggered, the return would be 38%.
Support is at $21.25-$21. Resistance is at $21.50-$21.75.
Green Dot (GDOT, $26.70, up $0.10)
GDOT March 25 calls (GDOT170317C00025000, $2.40, up $0.10)
Entry Price: $1.30 (1/6/2017)
Exit Target: $3, raise to $5 (closed half at $3 on 1/26/17)
Stop Target: $1.90, raise to $2 (Stop Limit Order on other half)
Action: Raise the Exit Target from $3 to $5. Raise the Stop Limit Order from $1.90 to $2 on the other half of the trade.
Shares surged to a high of $28.99 yesterday with the options reaching a peak of $3! Half of the trade was closed with the Limit Order at $3 tripping on Thursday. Volume was heavy and there was no specific news that I could find to cause the spike. This is telling me shares could make a run at $30 and there could be some takeover chatter happening.
Resistance is at $26.75-$27 with breakout potential to $30. Support is at $26.25-$26.
Sony (SNE, $31.12, up $0.33)
February 27 puts (SNE170217P00027000, $0.10, flat)
Entry Price: $0.65 (12/23/2016)
Exit Target: $1.30 (closed half at 10 cents on 1/23/17)
Stop Target: None
Action: Resistance is at $31-$31.25. Support is at $31-$30.75. The other half of the trade from December will likely expire worthless. However, earnings are coming out next month and I’m looking for a miss. This probably won’t be enough to save the remaining premium but worth a shot.