Mid-Market Update for 5/5/2017

Nonfarm Payrolls Impress

1:25pm (EST)

The market took this morning’s jobs report as a good sign of an improving economy after nonfarm payrolls showed an increase of 211,000 jobs in April, versus exceptions for an increase of 190,000. The unemployment rate came in at 4.4%, down from last month’s print of 4.5%.

The bulls came into today’s session with slight gains for the week and will be trying to hold them into the closing bell. There have been both bullish and bearish signs this week that helps explain the current two-week trading range and the lackluster action could loosen up next week.

The market will be getting another lesson in French history with this weekend’s election on who gets to run the country’s show. The results will be known Sunday evening with the outcome of the country staying, or not staying, with the Euro likely determined.

The overseas markets will be the first to react and will likely effect Monday’s action. In any event, with the portfolio light, and slightly hedged, we are in perfect shape to play the market’s next major trend.

The Dow is down 12 points to 20,939 while the S&P 500 is adding 2 points to 2,391. The Nasdaq is up 4 points to 6,080 and the Russell 2000 is higher by a point to 1,389.

I have updated the parameters of our VIAV trade from this morning. I could also have another new trade ahead of the closing bell. However, if you don’t hear from me again, have a great and safe weekend.


Momentum Options Play List

Closed Momentum Options Trades for 2017: 28-10 (74%). 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, $11.32, up $0.47)

June 12 calls (VIAV170616C00022500, $0.37, up $0.19)

Entry Price: $0.35 (5/2/2017)
Exit Target: $0.70-$1.05
Return: 6%
Stop Target: None

Action: Set Exit Targets at $0.70-$1.05. There is no Stop Target.

Shares have traded to a 52-week high of $11.49 today. Fresh resistance is at $11.50-$11.75. Support is at $11.25-$11.


iShares Russell 2000 (IWM, $138.23, up $0.13)

IWM June 134 puts (IWM170616P00134000, $1.30, down $0.05)

Entry Price: $1.40 (5/2/2017)
Exit Target: $2.10-$2.80
Return: -7%
Stop Target: 70 cents

Action: Resistance is at $138.50-$139. Near-term support is at $137.50-$137.


STMicroelectronics (STM, $16.56, up $0.34)

STM July 17.50 calls (STM170721C00017500, $0.65, up $0.15)

Entry Price: $0.55 (5/2/2017)
Exit Target: $1.10
Return: 18%
Stop Target: None

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


Cypress Semiconductor (CY, $13.29, down $0.03)

CY June 14 calls (CY170616C00014000, $0.40, flat)

Entry Price: $0.85 (4/20/2017)
Exit Target: $1.70
Return: -53%
Stop Target: 25 cents

Action: Support is at $13.25-$13. Resistance is at $13.50.