MomentumOptions.com Mid-Market Update for 4/10/2017

VIX Clears 13.50

1:05pm (EST)

The market got off to a good start and had an upward bias for the first hour of trading as futures were steady throughout the night and into the open. However, the slight run at resistance was met with selling pressure with volatility picking up steam. I mentioned this week could be lackluster up into Thursday’s action, and with the VIX above 13.50, caution should be used before opening fresh bullish positions.

On that note, I’ve also mentioned we shouldn’t get too aggressive with short positions until the VIX clears and holds 14.50-15 for several sessions. However, I’m looking at a possible short-term trade on the VIX, on a close above the aforementioned resistance levels.

I have tried to keep the portfolio light over the past couple of weeks as I mentioned a trading range with a lower bias could take effect in late March. This scenario has played out as planned with earnings season now underway. While this week could continue to be choppy, I believe over the two weeks or so, a clearer trend will emerge.

The Dow is up 41 points to 20,697 while the S&P 500 is gaining 4 points to 2,360. The Nasdaq is higher by 9 points to 5,887 and the Russell 2000 is off a point to 1,363. The S&P 500 Volatility Index ($VIX, 13.77, up 0.90) is up 7%.

I have updated our current trades so let’s go check the tape.

 

Momentum Options Play List

Closed Momentum Options Trades for 2017: 22-5 (81%). 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.

 

STMicroelectronics (STM, $15.45, down $0.10)

STM May 15 calls (STM170519C00015000, $1.15, down $0.05)

Entry Price: $1.15 (3/31/2017)
Exit Target: $2.30
Return: 0%
Stop Target: 55 cents

Action: Support is at $15.25-$15 and the 50-day moving average if $15.50 fails to hold this week. Resistance is at $15.75-$16.

 

Viavi Solutions (VIAV, $9.90, down $0.16)

VIAV May 12 calls (VIAV170519C00012000, $0.10, flat)

Entry Price: $0.29 (3/27/2017)
Exit Target: $0.60
Return: -66%
Stop Target: None

VIAV April 11 calls (VIAV170421C00011000, $0.03, down $0.02)

Entry Price: $0.42 (3/20/2017)
Exit Target: $0.85
Return: -93%
Stop Target: None

Action: Support is at $10-$9.75. Resistance is at $10.25-$10.50.

 

Amicus Therapeutics (FOLD, $6.99, flat)

FOLD April 8 calls (FOLD170421C00008000, $0.05, flat)

Entry Price: $0.60 (3/2/2017)
Exit Target: $1.20
Return: -92%
Stop Target: None

Action: Support is at $6.75. Resistance is at $7-$7.25.

 

Flex (FLEX, $16.31, down $0.04)

FLEX April 17 calls (FLEX170421C00017000, $0.05, flat)

Entry Price: $0.35 (2/15/2017)
Exit Target: $0.70
Return: -86%
Stop Target: None

Action: Support is at $16.25-$16. Resistance is at $16.50-$16.75.