MomentumOptions.com Pre-Market Update for 6/22/2017

Bears Take Second-Straight

8:00am (EST)

The bears made an appearance again on Wednesday to get their second straight overall win over nervousness in oil and a continued decline in the Transports. Tech did well but the small-caps closed below a key level of support with stretch coming into play into the closing bell. Today’s session could have extra zip on it with a proposed Healthcare plan being unveiled during the morning open.

The Dow declined 57 points, or 0.3%, to end at 21,410. The blue-chips tested a high of 21,492 with lower resistance at 21,500-21,600 standing tall. Fresh support remains at 21,250-21,200 with Wednesday’s low tapping 21,390.

The S&P 500 slipped just over a point, or 0.1%, to close at 2,436. The index made a run to 2,442 shortly after the open with lowered resistance at 2,440-2,450 holding. Lower support at 2,440-2,435 was stretched to 2,430 with backup help at 2,425-2,420.

The Nasdaq gained nearly 46 points, or 0.7%, to finish just below 6,234. Tech opened at 6,202 and held the 6,200 level throughout the session. The push to 6,236 split resistance at 6,200-6,250 with a move above the latter a bullish development. Fresh support is at 6,200-6,175 with additional risk to 6,150-6,100 on a move back below the latter.

The Russell 2000 dropped 3 points, or 0.3%, to settle at 1,399. The small-caps were showing strength during the morning action with the high reaching 1,411. Lower resistance at 1,410-1,415 was cleared but levels that failed to hold. The backtest to 1,398 and close below lower support at 1,410-1,400 was slightly bearish. I have warned a move below 1,395 could spark additional selling pressure and where we could get long IWM put options.

The S&P 500 Volatility Index ($VIX, 10.75, down 0.11) traded down to 10.40 with upper support support at 10-9.75 easily holding. Lower resistance at 11.50-12.50 was tested during the second half with the high checking in at 11.40.

I will have at least one to three New Trades shortly after this morning’s open so stay close to your email inboxes.

From desk to press, futures look like this: Dow (-5); S&P 500 (+1); Nasdaq 100 (+8).

 

Momentum Options Play List

Closed Momentum Options Trades for 2017: 38-15 (71xx%). 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.

 

iPath S&P 500 VIX Futures (VXX, 12.79, down 0.12)

VXX August 14 calls (VXX170818C00014000, $0.95, flat)

Entry Price: $1.20 (6/15/2017)
Exit Target: $2.40
Return: -21%
Stop Target: None

Action: Support is at 12.50-12.25 with yesterday’s low reaching 12.61. Resistance is at 12.75-13.