MomentumOptions.com Pre-Market Update for 6/23/2017
Small-Caps Hold Support
The market traded on both sides of the ledger again on Thursday with the Healthcare sector leading the action. Healthcare Insurers and Hospital stocks saw slight gains after Republican leaders in the Senate released a draft of their proposed bill to repeal-and-replace the Affordable Care Act. However, Financial stocks were weak and kept a lid on the major indexes from making a more serious run at resistance.
The Dow fell a dozen points, or 0.1%, to close at 21,397. The blue-chips traded to an intraday high of 21,456 with lower resistance at 21,500-21,600 easily holding. The fade to 21,394 held support at 21,250-21,200. A holding pattern has developed this week with the index holding a slim 13-point gain.
The S&P 500 gave back a point, or 0.1%, to finish at 2,434. The index tested a low of 2,433 shortly after the opening bell with backup support at 2,425-2,420 standing strong. The rebound to 2,441 cleared lower resistance at 2,440-2,450 but levels that failed to hold into the close. For the week, the index is up just over a point.
The Nasdaq added 2 points, or 0.04%, to settle at 6,236. Tech opened 6 points higher at 6,239 before making a backtest to 6,221 during the first half of action. Support at 6,200-6,175 was hardly challenged and levels that need to hold ahead of the weekend. The run to 6,257 afterwards cleared lower resistance at 6,250-6,275 and levels that need to be cleared today, or next week, to keep all-time highs in play.
The Russell 2000 climbed 5 points, or 0.4%, to end at 1,404. The small-caps were slightly weak for the opening hour with the low reaching 1,396. I have talked about how crucial it is for 1,395 to hold as there is risk to backup support at 1,380-1,375, if breached. The bounce to 1,408 afterwards and close above the 1,400 level was slightly bullish. Short-term resistance is at 1,410-1,415.
The S&P 500 Volatility Index ($VIX, 10.48, down 0.27) was slightly elevated after peaking at 11.01 on the open but held lower resistance at 11.50-12.50. The late day low reached 10.24 with support at 10-9.75 coming into play.
I have updated the parameters of our two new positions so let’s go check the tape.
From desk to press, futures look like this: Dow (+21); S&P 500 (+2); Nasdaq 100 (+8).
Momentum Options Play List
Closed Momentum Options Trades for 2017: 38-15 (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.
Amicus Therapeutics (FOLD, $10.09, up $0.15)
FOLD July 10 calls (FOLD170721C00010000, $0.70, up $0.18)
Entry Price: $0.70 (6/22/2017)
Exit Target: $1.40
Stop Target: None
Action: Set an Exit Target at $1.40. There is no Stop Target.
Shares traded to a fresh 52-week high of $10.33 yesterday while regaining the $10 level. Longer-term resistance is at $10.50-$10.75. My near-term target is still pricing in a possible run to $12. If cleared by July 21st, this trade could return up to 200%. Support is at $9.50 if $10 fails to hold.
TherapeuticsMD (TXMD, $5.73, down $0.07)
TXMD August 7.50 calls (TXMD170818C00007500, $0.50, up $0.05)
Entry Price: $0.50 (6/22/2017)
Exit Target: $1.00
Stop Target: None
Action: Set an Exit Target at $1.00. There is no Stop Target.
Near-term resistance is at $5.75-$6 and the 200-day moving average. A close above the latter would be a bullish development and could spark short-sellers to cover. Yesterday’s peak reached $5.97. Support is at $5.50 and the 100-day moving average.
iPath S&P 500 VIX Futures (VXX, 12.66, down 0.13)
VXX August 14 calls (VXX170818C00014000, $0.85, down $0.10)
Entry Price: $1.20 (6/15/2017)
Exit Target: $2.40
Stop Target: None
Action: Support is at 12.50-12.25. Resistance is at 12.75-13.