Pre-Market Update for 2/14/2017

Small-Caps Join the Club

8:00am (EST)

After weeks, and months, of trailing behind the Three Musketeers, the Russell 2000 finally broke out to fresh all-time highs. The major three indexes also continued their stair-stepping to higher highs as the bulls got off to a good start for the week. The bears will be trying to slow momentum as Fed speak will heat up over the next few days and the week wraps up with February option expiration.

The Dow zoomed 142 points, or 0.7%, to finish at 20,412 on Monday. The blue-chips opened at 20,338 while reaching an intraday record peak of 20,441. The close above upper resistance at 20,350-20,400 firmly puts 20,550-20,600 in play. Support is at 20,200-20,125 followed by 20,000-19,900.

The S&P 500 surged 12 points, or 0.5%, to settle at 2,328. The index made a steady run to a midday all-time high of 2,331 while closing above lower resistance at 2,325-2,350. Support remains at 2,300-2,290 with a close below 2,285 our hint to trim bullish positions.

The Nasdaq soared 29 points, or 0.5%, to close at 5,763. Tech reached another lifetime high of 5,770 during the second half of action while closing above lower resistance at 5,750-5,800. Rising support is at 5,725-5,700 with a close below 5,675-5,650 being our warning signs to possibly go short.

The Russell 2000 gained 3 points, or 0.3%, to end at 1,392. The small-caps reached their height shortly after the open after peaking at 1,398. The prior all-time high of 1,392.72 was easily cleared to open up resistance at 1,400-1,425. Support remains at 1,375-1,370 on a move below 1,385.

The S&P 500 Volatility Index ($VIX, 11.07, up 0.22) stayed slightly elevated throughout Monday with the high reaching 11.40. Lower resistance at 11.50-12.50 held with a close above the latter being a yellow light. Support remains at 11-10.50.

I have raised the Stop Limits on our VIAV call options to continue to protect triple-digit profits.

From desk to press, futures look like this: Dow (-5); S&P 500 (-1); Nasdaq 100 (-2).


Momentum Options Play List

Closed Momentum Options Trades for 2017: 9-2 (82%). All trades are dated and time stamped for verification. New subscribers can look at the past history to see how the trades have played out or to research our Track Records.

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.


Jabil Circuit (JBL, $25.44, up $0.08)

JBL March 26 calls (JBL170317C00026000, $0.70, up $0.10)

Entry Price: $0.65 (2/13/2017)
Exit Target: $1.30
Return: 8%
Stop Target: None

Action: Resistance is at $25.75-$26 with yesterday 52-week peak reaching $25.61. Support is at $25.25-$25.


Flex (FLEX, $16.12, up $0.12)

FLEX March 16 calls (FLEX170317C00016000, $0.45, up $0.05)

Entry Price: $0.40 (2/10/2017)
Exit Target: $0.80
Return: 12%
Stop Target: None

Action: Resistance is at $16.25-$16.50. Monday’s run to $16.19 was another 52-week high. Support is at $15.75-$15.50.


Viavi Solutions (VIAV, $10.58, up $0.36)

VIAV March 10 calls (VIAV170317C00010000, $0.80, up $0.25)

Entry Price: $0.40 (2/8/2017)
Exit Target: $0.80
Return: 100%
Stop Target: 48 cents, raise to 60 cents (Stop Limit)

VIAV March 9 calls (VIAV170317C00009000, $1.60, up $0.30)

Entry Price: $0.50 (1/25/2017)
Exit Target: $2.00
Return: 220%
Stop Target: $1.20, raise to $1.30 (Stop Limit)

Action: Raise the Stop Limit from 48 cents to 60 cents on the VIAV March 10 calls.

Raise the Stop Limit from $1.20 to $1.30 on the VIAV March 9 calls.

Yesterday’s fresh 52-week peak reached $10.64. Resistance is at $10.75-$11. Rising support is at $10.25-$10.


Boston Scientific (BSX, $25.30, up $0.10)

BSX March 25 calls (BSX170317C00025000, $0.70, flat)

Entry Price: $0.70 (2/7/2017)
Exit Target: $1.40
Return: 0%
Stop Target: None

Action: Shares traded to a high of $24.33 on Monday. Resistance is at $25.50-$25.75. Support is at $25-$24.75.


Tower Semiconductor (TSEM, $22.56, up $0.49)

TSEM March 23 calls (TSEM170317C00023000, $0.60, down $0.05)

Entry Price: $0.45 (2/7/2017)
Exit Target: $0.90 (closed half at $0.80 on 2/13/2017)
Return: 56%
Stop Target: 35 cents (Stop Limit)

Action: Set a Stop Limit at 35 cents on the other half of the trade. It appears as though “big money” came into the trade yesterday as volume in these options was explosive. I set the initial Stop Limit slightly lower than the entry price because I don’t want to get scalped on the other half of our position.

Fresh resistance is at $23 and the 52-week high from yesterday. Rising support is at $22-$21.75.


TherapeuticsMD (TXMD, $5.80, flat)

TXMD June 7.50 calls (TXMD170616C00007500, $0.60, flat)

Entry Price: $0.75 (1/18/2017)
Exit Target: $1.50
Return: -20%
Stop Target: None

Action: Resistance is at $6. Support is at $5.75-$5.50.