Pre-Market Update for 3/21/2017

VIX Holds 11.50

8:00am (EST)

Monday’s slight market pullback / mixed action was pinned on political rhetoric with many of the talking heads worried about what was said, or done, during the political election and by whom. While the news was discoursing, I focus more on history and trends instead of the distractions. The goods news is the Dow closed just slightly lower to start the week with volatility staying below a key level of support.

The Dow dipped 8 points, or 0.04%, to end at 20,905. The blue-chips made a morning run to 20,955 after opening 2 points higher. Lower resistance at 21,000-21,200 held and the lower high than Friday’s trip to 20,980 was a slightly bearish signal. Fresh support at 20,900-20,800 easily held on the intraday dip to 20,885.

The S&P 500 slipped 4 points, or 0.2%, to finish at 2,373. The index traded just a point higher shortly after the open to 2,379 while failing resistance at 2,390-2,400. The fade 2,369 late in the session held upper support at 2,370-2,365. A close below the latter would be a yellow light.

The Nasdaq climbed a half-point, or 0.01%, to settle at 5,901. Tech conquered another all-time intraday high north of 5,915 with fresh resistance and fluff to 5,925-5,950 holding. Newly minted support at 5,875-5,850 easily held on the backtest to 5,888 during the second half of trading.

The Russell 2000 fell 7 points, or 0.5%, to close at 1,384. The small-caps opened lower and stayed underwater throughout the day with the bottom reaching 1,381. Upper support at 1,375-1,370 was defended and easily held into the closing bell. Resistance remains at 1,390-1,400.

The S&P 500 Volatility Index ($VIX, 11.34, up 0.06) tested a low of 11.03 about a half-hour after the opening bell with upper support at 11-10.50 holding. The tug-of-war over the 11.50 level remains in play along with resistance at 12.50-13.50. Yesterday’s high reached 11.72.

I have raised the Stop Limit on two of our current VIAV trades while setting one for TXMD.

From desk to press, futures look like this: Dow (+28); S&P 500 (+5); Nasdaq 100 (+14).


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, $10.78, up $0.08)

VIAV April 11 calls (VIAV170421C00011000, $0.40, up $0.03)

Entry Price: $0.42 (3/20/2017)
Exit Target: $0.85
Return: -5%
Stop Target: None

VIAV April 10 calls (VIAV170421C00010000, $0.95, flat)

Entry Price: $0.45 (3/15/2017)
Exit Target: $1.35
Return: 111%
Stop Target: 75 cents, raise to 80 cents (Stop Limit)

VIAV June 11 calls (VIAV170616C00011000, $0.75, flat)

Entry Price: $0.40 (3/15/2017)
Exit Target: $1.20
Return: 88%
Stop Target: 55 cents, raise to 60 cents (Stop Limit)

Action: Raise the Stop Limit from 75 cents to 80 cents on the April 10 calls. Raise the Stop Limit from 55 cents to 60 on the June 11 calls.

Shares traded up to $11 and a fresh 52-week peak on Monday while pushing upper resistance at $10.75-$11. Support is at $10.50-$10.25 on a move back below $10.75.


Starbucks (SBUX, $55.81, up $0.03)

April 52.50 puts (SBUX170421P00052500, $0.10, down $0.03)

Entry Price: $0.40 (3/10/2017)
Exit Target: $0.80
Return: -75%
Stop Target: None

Action: Resistance is at $56-$56.50 with yesterday’s high reaching $56.05. Support is at $55.50-$55.


Amicus Therapeutics (FOLD, $7.26, up $0.24)

FOLD April 8 calls (FOLD170421C00008000, $0.25, flat)

Entry Price: $0.60 (3/2/2017)
Exit Target: $1.20
Return: -58%
Stop Target: None

Action: The close above lower resistance at $7.25-$7.50 was slightly bullish. Support is at $7-$6.75.


Tower Semiconductor (TSEM, $23.33, up $0.41)

TSEM April 24 calls (TSEM170421C00024000, $0.45, up $0.10)

Entry Price: $0.65 (3/1/2017)
Exit Target: $1.30
Return: -31%
Stop Target: None

Action: Shares kissed a fresh 52-week peak at $23.56 on Monday. Fresh resistance is at $23.75-$24. Rising support is at $23.25-$23.


Flex (FLEX, $16.71, down $0.09)

FLEX April 17 calls (FLEX170421C00017000, $0.30, down $0.05)

Entry Price: $0.35 (2/15/2017)
Exit Target: $0.70
Return: -14%
Stop Target: None

Action: Yesterday’s high tapped $16.93 and missed setting a 52-week peak by 6 cents. Resistance is at $17-$17.25. The close below lower support at $16.75-$16.50 was a bummer.


TherapeuticsMD (TXMD, $6.88, down up $0.18)

TXMD June 7.50 calls (TXMD170616C00007500, $0.95, down $0.10)

Entry Price: $0.75 (1/18/2017)
Exit Target: $1.50
Return: 27%
Stop Target: 80 cents (Stop Limit)

Action: Set a Stop Limit at 80 cents to protect profits.

Shares traded to a low of $6.14 on Monday. Resistance is at $7-$7.25. Support is at $6.75.