Mid-Market Update for 4/21/2017

Oil Drop Below $50/ New Trade (SNAP)

2:00pm (EST)

There are a lot of stories developing ahead of the weekend that are holding the bulls back from their pursuit of higher highs. The upcoming French election on Sunday will likely sway overseas markets on Monday with the carryover weighing on US stocks.

Next week is also the busiest for earnings with over a third of the S&P 500 companies reporting. There is also a pending government shutdown that will need to be resolved along with the possible proposal(s) of new legislation.

It will be a very busy next week with action throughout and catalysts that will likely give the bulls continued momentum, or provide the bears another opportunity to stay in the game.

The choppy action and divergence between the major indexes has also been tricky to trade but the price action remains bullish. Although March lows are still in play on a bad day, I have outlined clear levels of support we will go short, when breeched.

The Dow is down 40 points to 20,538 while the S&P 500 is off 8 points to 2,347. The Nasdaq is lower by 14 points to 5,902 and the Russell 2000 is slipping 5 points to 1,378. The VIX has cleared 15 and is at 15.14, up 0.99.

Speaking of bullishness, I have a New Trade I want to get us into ahead of the closing bell. It is a recent IPO and a stock I have been wanting to trade options on when the timing was right. We may be getting that opportunity. I will be back Monday morning with a full update. Until then, have a great and safe weekend.


Momentum Options Play List

Closed Momentum Options Trades for 2017: 23-9 (72%). 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

Snap (SNAP, $20.82, down $0.33)

Buy to Open SNAP May 23 calls (SNAP170519C00023000, $0.75, down $0.12)

Action: I like these call options at current levels and you can use a Limit Order up to 95 cents to get the best fills. These are the regular SNAP May 23 calls that expire on May 19th, 2017. I will provide the parameters of the trade in Monday’s Pre-Market Update.


Current Trades

Cypress Semiconductor (CY, $14.00, down $0.09)

CY June 14 calls (CY170616C00014000, $0.85, down $0.05)

Entry Price: $0.85 (4/20/2017)
Exit Target: $1.70
Return: 0%
Stop Target: None

Action: Support is at $13.75-$13.50 and the 50-day moving average. Resistance is at $14.25-$14.50.


Square (SQ, $17.45, down $0.26)

SQ June 18 calls (SQ170616C00018000, $0.90, down $0.10)

Entry Price: $0.95 (4/20/2017)
Exit Target: $1.90
Return: -5%
Stop Target: None

Action: Support is at $17.50-$17.25. Resistance is at $17.75-$18.


Best Buy (BBY, $50.68, up $0.15)

BBY May 45 puts (BBY170519P00045000, $0.20, flat)

Entry Price: $0.57 (4/13/2017)
Exit Target: $1.15
Return: -65%
Stop Target: None

Action: Resistance is at $50.50-$51. Support is at $50-$49.75.


STMicroelectronics (STM, $14.64, down $0.22)

STM May 15 calls (STM170519C00015000, $0.60, down $0.10)

Entry Price: $1.15 (3/31/2017)
Exit Target: $2.30
Return: -48%
Stop Target: 40 cents (Stop Limit)

Action: Resistance is at $15-$15.25. Support is at $14.75-$14.50.