Pre-Market Update for 3/17/2017

Failed Follow Through

8:00am (EST)

The bulls nearly got a taste of all-time highs again but failed to keep their momentum as the market ended mixed on Thursday. The action turned negative about an hour into trading and remained choppy into the final bell. Tech came within spitting distance of a record high and the indexes are still up for the week, both good signs. However, today’s close will be important as the market will try to fight off historical late March weakness starting next week.

The Dow dipped 15 points, or 0.1%, to settle at 20,934. The blue-chips kissed lower resistance at 21,000-21,200 on the button shortly after the open but a level that failed to hold. The fade to 20,893 easily held support at 20,800-20,750 with a move below the latter a bearish development.

The S&P 500 slipped roughly 4 points, or 0.2%, to close at 2,381. The index made a run to 2,388 but fell a 12-pack shy of resistance and the all-time peak just north of 2,400. The backtest to 2,377 held support at 2,370-2,365 with a close below 2,360 a bearish development.

The Nasdaq gained nearly a point, or 0.01%, and remained at 5,900. Tech traded to a high of 5,911.48 but failed the lifetime high at 5,911.79 by a third-point. Near-term resistance is at 5,925-5,950. Support is trying to move up to 5,875-5,850 with yesterday’s low reaching 5,887. Additional help is at 5,825-5,800 on a move below the latter.

The Russell 2000 added 3 points, or 0.2%, to finish at 1,386. The small-caps reached a morning peak of 1,389 with lower resistance at 1,390-1,400 standing strong. The index held positive territory for the majority of the session aside from an intraday half-point test to 1,382. Support at 1,375-1,370 and the 50-day moving average will be crucial levels to hold ahead of the weekend.

The S&P 500 Volatility Index ($VIX, 11.21, down 0.42) stayed subdued throughout the day with the low coming in at 11.16. Support at 11-10.50 held and the move back below 11.50 was slightly bullish. Resistance at 12.50-13.50 on a move back above this level.

From desk to press, futures look like this: Dow (-19); S&P 500 (-3); Nasdaq 100 (-1).


Momentum Options Play List

Closed Momentum Options Trades for 2017: 18-3 (86%). 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 a Trade Alert outside of these time frames.


Viavi Solutions (VIAV, $10.20, up $0.30)

VIAV April 10 calls (VIAV170421C00010000, $0.60, up $0.17)

Entry Price: $0.45 (3/15/2017)
Exit Target: $0.90
Return: 33%
Stop Target: None

VIAV June 11 calls (VIAV170616C00011000, $0.50, up $0.10)

Entry Price: $0.40 (3/15/2017)
Exit Target: $0.80
Return: 25%
Stop Target: None

Action: Fresh resistance is at $10.25-$10.50 with Thursday’s high tapping $10.35. Rising support is at $10-$9.50.


Starbucks (SBUX, $54.80, up $0.26)

April 52.50 puts (SBUX170421P00052500, $0.22, down $0.11)

Entry Price: $0.40 (3/10/2017)
Exit Target: $0.80
Return: -45%
Stop Target: None

Action: Shares closed above lower resistance at $54.75-$55 following yesterday’s run to $54.98. Support has moved up to is at $54.25-$54.


Amicus Therapeutics (FOLD, $7.12, up $0.07)

FOLD April 8 calls (FOLD170421C00008000, $0.30, flat)

Entry Price: $0.60 (3/2/2017)
Exit Target: $1.20
Return: -50%
Stop Target: None

Action: Shares traded down to $6.95 on Thursday. Support is at $7-$6.75. Resistance is at $7.25-$7.50.


Tower Semiconductor (TSEM, $22.73, down $0.35)

TSEM April 24 calls (TSEM170421C00024000, $0.30, down $0.10)

Entry Price: $0.65 (3/1/2017)
Exit Target: $1.30
Return: -54%
Stop Target: None

Action: Support is at $22.75-$22.50. Resistance is at $23.25-$23.50.


Flex (FLEX, $16.86, down $0.02)

FLEX April 17 calls (FLEX170421C00017000, $0.35, flat)

Entry Price: $0.35 (2/15/2017)
Exit Target: $0.70
Return: 0%
Stop Target: None

Action: Shares touched $16.99 and a fresh 52-week high before closing slightly lower. Resistance is at $17-$17.25. Support is at $16.75-$16.50.


TherapeuticsMD (TXMD, $6.95, up $0.12)

TXMD June 7.50 calls (TXMD170616C00007500, $1.00, up $0.05)

Entry Price: $0.75 (1/18/2017)
Exit Target: $1.50
Return: 33%
Stop Target: None

Action: Shares went out at the session high and cleared its 200-day moving average in the process. The 50/100-day moving averages are in a nice uptrend. Resistance is at $7-$7.25. Support is at $6.75-$6.50.

The mid-November high is at $7.50 with a close above this level likely leading to $9-$9.25 on breakout momentum.