MomentumOptions.com Mid-Market Update for 7/6/2017

Kellogg (K) Shares Tapping Fresh 52-Week Lows

1:40pm (EST)

Shares of Kellogg (K) continue to show weakness following another 52-week low of $66.97 today. The tumble north of $74 from the beginning of June has now turned into a 10% pullback. The major moving averages are all in a nasty downtrend on the daily chart and show no signs off leveling out. Resistance is at $68-$68.25.

The 3-year weekly chart shows risk to $65 and the 200-day moving average on continued weakness.

The K August 65 puts (K170818P00065000, $1.15, up $0.20) can be targeted by bearish traders expecting a possible drop below $65. These options would double from current levels if shares fall below $62.70, technically, by August 18th.

I have the aforementioned puts on my Watch List but I want to do some fundamental analysis before possibly making this an official trade. Earnings are due out August 3rd and would provide the catalyst for a possible plunge to $62.50 on an earnings miss, or lowered guidance.

Turning our attention to the markets, its been a bearish day with the indexes trading in the red throughout the session. The Dow is down 64 points to 21,413 while the S&P 500 is sliding 9 points to 2,423. The Nasdaq is lower by 25 points to 6,125 and the Russell 2000 is giving back 8 points to 1,412.

I have updated our current trades so let’s go check the tape.

 

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.

 

Bank of America (BAC, $25.03, up $0.13)

BAC August 25 calls (BAC170818C00025000, $0.88, up $0.08)

Entry Price: $0.75 (7/3/2017)
Exit Target: $1.50
Return: 17%
Stop Target: None

Action: Fresh resistance at $25-$25.25. Rising support is at $24.75-$24.50.

 

AT&T (T, $37.49, down $0.14)

T August 37 puts (T170818P00037000, $0.60, up $0.03)

Entry Price: $0.78 (6/29/2017)
Exit Target: $1.60
Return: -23%
Stop Target: None

Action: Support is at $37.50-$37.25. Resistance is at $37.75-$38.

 

Amicus Therapeutics (FOLD, $10.73, up $0.44)

FOLD July 10 calls (FOLD170721C00010000, $0.95, up $0.30)

Entry Price: $0.70 (6/22/2017)
Exit Target: $1.40
Return: 36%
Stop Target: None

Action: Fresh resistance is at $10.75-$11 on today’s breakout to fresh 52-week peaks. Rising support is at $10.50-$10.25.

 

TherapeuticsMD (TXMD, $5.13, down $0.24)

TXMD August 7.50 calls (TXMD170818C00007500, $0.35, down $0.05)

Entry Price: $0.50 (6/22/2017)
Exit Target: $1.00
Return: -30%
Stop Target: None

Action: Support is at $5.25-$5. Resistance is at $5.50.

 

iPath S&P 500 VIX Futures (VXX, 13.16, up 0.27)

VXX August 14 calls (VXX170818C00014000, $1.05, up $0.15)

Entry Price: $1.20 (6/15/2017)
Exit Target: $2.40
Return: -12%
Stop Target: None

Action: Resistance is at 13-13.50. Support is at 12.75-12.50.