Pre-Market Update for 6/2/2017

Bulls Continue Assault on Fresh Highs

8:00am (EST)

The bulls continued their quest for fresh all-time highs with the Nasdaq and S&P 500 setting new records on Thursday. The Dow came close to joining the club while the Russell 2000 closed above key levels of resistance. The rebound in the Transports was also a bullish clue for Dow Theorists as the blue-chips and the Transports often trade in tandem. This morning’s jobs report should shape today’s action with Wall Street still waiting for a market pullback.

The Dow jumped 135 points, or 0.7%, to end at 21,144. The blue-chips were slightly weak on the open, despite opening higher, with the low reaching 20,994. Upper support at 21,000-20,900 easily held before a steady run to a closing all-time high. Resistance at 21,150-21,200 held with the all-time intraday peak at 21,169. A close above the latter could lead to a run to 21,450-21,500.

The S&P 500 gained 18 points, or 0.8%, to settle 2,430. The index held positive territory throughout the session with the intraday lifetime high coming into the closing bell. Near-term resistance at 2,420-2,425 was cleared and keeps breakout potential up to 2,450-2,460 in play. Support has moved up to 2,410-2,400 with a close below 2,390 signaling a possible top.

The Nasdaq advanced 48 points, or 0.8%, to close at 6,246. Tech opened at 6,215 and held the 6,200 level following Thursday’s record run to 6,247. Resistance at 6,250-6,275 held with fluff potential 6,300-6,350 on continued momentum. Support has moved up to at 6,200-6,175 with a move below 6,150 now a warning sign to possibly lighten bullish positions.

The Russell 2000 rallied 25 points, or 1.9%, to finish at 1,396. The small-caps also held positive territory throughout Thursday with the index also closing just near its high. The move back above resistance at 1,375-1,380 and the 50/100-day moving averages was a very bullish development. Fresh hurdles are at 1,400-1,405. Support has moved up to 1,385-1,380.

The S&P 500 Volatility Index ($VIX, 9.89, down 0.52) traded up to 10.54 during the morning action with lower resistance at 10.50-11.50 getting stretched but holding. Support at 9.75-9.50 was breeched but held on the intraday test to 9.69.

I have updated our latest piggy-back trade, FLEX, along with the original position to maximize profits.

From desk to press, futures look like this: Dow (+59); S&P 500 (+5); Nasdaq 100 (+17).


Momentum Options Play List

Closed Momentum Options Trades for 2017: 32-10 (76%). 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.


Flex (FLEX, $17.61, up $0.35)

FLEX July 18 calls (FLEX170721C00018000, $0.43, up $0.10)

Entry Price: $0.40 (6/1/2017)
Exit Target: $0.80
Return: 8%
Stop Target: None

FLEX July 17 calls (FLEX170721C00017000, $0.95, up $0.20)

Entry Price: $0.45 (5/16/2017)
Exit Target: $0.90, raise to $1.35
Return: 111%
Stop Target: 47 cents, raise to 75 cents (Stop Limit)

Action: Set an Exit Target at 80 cents for the July 18 calls. There is no Stop Target.

Raise the Exit Target from 90 cents to $1.35 on the July 17 calls. Raise the Stop Limit from 47 cents to 75 cents to protect profits.

Fresh resistance at $17.75-$18 following’s yesterday’s gallop to $17.65 and 52-week high. I have a Price Target of $20 on the stock by mid-July on continued momentum. Support is at $17.25-$17.


Sony (SNE, $36.30, down $0.32)

SNE July 37 calls (SNE170721C00037000, $0.85, down $0.05)

Entry Price: $0.85 (5/26/2017)
Exit Target: $1.70
Return: 0%
Stop Target: None

Action: Upper support at $36.25-$36 held on yesterday’s backtest to the session low into the close. Resistance is at $36.75-$37.


Amicus Therapeutics (FOLD, $8.13, up $0.11)

FOLD July 8 calls (FOLD170721C00008000, $0.80, up $0.05)

Entry Price: $0.85 (5/22/2017)
Exit Target: $1.70-$2.55
Return: -6%
Stop Target: None

Action: Shares traded up to $8.22 on Thursday. Resistance is at $8.25-$8.50. Rising support is at $7.75-$7.50.


Spider Gold Shares (GLD, $120.72, up $0.10)

GLD June 122 calls (GLD170616C00122000, $0.60, flat)

Entry Price: $0.75 (5/22/2017)
Exit Target: $1.50
Return: -20%
Stop Target: None

Action: Rising support at $120-$119.75 held with yesterday’s low reaching $120.06. The rebound to $120.74 fell shy of resistance at $121-$121.50.


STMicroelectronics (STM, $16.35, down $0.12)

STM October 20 calls (STM171020C00020000, $0.55, flat)

Entry Price: $0.70 (5/15/2017)
Exit Target: $1.40
Return: -21%
Stop Target: None


STM July 17.50 calls (STM170721C00017500, $0.45, flat)

Entry Price: $0.65 (5/15/2017)
Exit Target: $1.30
Return: -31%
Stop Target: None

Action: Support is at $16.25-$16. Thursday’s low tapped $16.27. Resistance is at $16.75-$17.


Viavi Solutions (VIAV, $11.57, up $0.34)

June 12 calls (VIAV170616C00022500, $0.18, up $0.06)

Entry Price: $0.35 (5/5/2017)
Exit Target: $0.70-$1.05
Return: -49%
Stop Target: None

Action: Resistance at $11.50 was cleared following the push to $11.58 yesterday. Support is trying to move up to $11.25-$11.


Cypress Semiconductor (CY, $14.13, up $0.14)

CY June 14 calls (CY170616C00014000, $0.45, up $0.05)

Entry Price: $0.85 (4/20/2017)
Exit Target: $1.70
Return: -47%
Stop Target: None

Action: Resistance is at $14.25-$14.50 was challenged with the run to $14.29. Rising support is at $14-$13.75.