Mid-Market Update for 4/13/2017

Bulls Need a Lifeline/ New Trade (BBY), Trade Alert (VIAV)

12:50pm (EST)

Futures were choppy throughout the night and were indicating another back-and-forth session as Wall Street wraps up a shortened week on heightened geopolitical concerns and the start of 1Q earnings season.

Financial stocks were showing some strength along with Tech but the overall action has been much of the same over the past four weeks. While I was hoping for more clearer signs a rebound rally could be coming, today’s action is just not defining enough. I will take a closer look at the results from C, JPM, and WFC over the weekend but on the surface, the numbers were solid.

I mentioned JPM was my favorite name in the group and that WFC still faces some downside risk. After a higher open, JPM has given back its gains while WFC has traded underwater throughout the day.

The Dow is down 37 points to 20,554 while the S&P 500 is off 3 points to 2,341. The Nasdaq is higher by a point to 5,836 and the Russell 2000 is declining 7 points to 1,351.

It has been two weeks since I have recommended a new trade and it is the longest time period I have gone without opening a fresh position in a decade. However, I often mention trading ranges are extremely tricky and timing market tops, and bottoms, can be just as difficult.

The market is closed for Good Friday and it will be nice to enjoy a 3-day weekend with warmer weather now in the mix. Although I was hoping to have more open and new trades going into next week, it will also be relaxing to just do some research over the weekend. Our next batch of trades will have May, June and possibly July expiration dates but it still unclear if the majority of the trades will be call or put options.

On that note, I do have a New Trade on BBY I want to get us into, along with a Trade Alert for VIAV. I could also have additional action into the closing bell so stay locked-and-loaded. If you don’t hear from me again, have a great and safe 3-day weekend!


Momentum Options Play List

Closed Momentum Options Trades for 2017: 22-8 (73%). 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.

New Trade

Best Buy (BBY, $48.49, up $0.13)

Buy to Open BBY May 45 puts (BBY170519P00045000, $0.57, up $0.04)

Action: I like these put options at current levels and you can use a Limit Order up to 70 cents to get the best fills. These are the regular BBY May 45 puts that expire on May 19th, 2017. I will provide the parameters of the trade in Monday’s Pre-Market update.


Current Trades

STMicroelectronics (STM, $14.74, down $0.01)

STM May 15 calls (STM170519C00015000, $0.65, flat)

Entry Price: $1.15 (3/31/2017)
Exit Target: $2.30
Return: -43%
Stop Target: 55 cents

Action: Support is at $14.75-$14.50. Resistance is at $15.


Viavi Solutions (VIAV, $9.66, up $0.19)

VIAV May 12 calls (VIAV170519C00012000, $0.05, flat)

Entry Price: $0.29 (3/27/2017)
Exit Target: $0.60
Return: -83%
Stop Target: None

Action: Close the trade at current levels to save the remaining premium. We can revisit the story again when shares clear $10-$10.25.