MomentumOptions.com Pre-Market Update for 7/12/2017
Wait-and-See Attitude Continues
The market was choppy on Tuesday after trading on both sides of the ledger and finishing mixed. The action likely signaled some caution ahead of Federal Reserve Chairwoman Janet Yellen’s testimony to Congress over the next couple of days. The tight trading range this week could loosen if she provides more details on monetary policy.
The Dow gained a half-point, or 0.0%, to settle at 21,409. The blue-chips traded to a morning high of 21,441 with resistance at 21,500-21,600 easily holding. The 33-point gain was wiped out on the drop to 21,279 shortly afterwards. Lower support at 21,300-21,250 held with risk to 21,100-21,000 and the 50-day moving average on a move below the latter.
The S&P 500 slipped 2 points, or 0.1%, to end at 2,425. The index tested a morning low of 2,412 during the first half of action with support is at 2,410-2,400 holding for the third time in four sessions. Resistance remains at 2,435 with further hurdles at 2,440-2,450.
The Nasdaq gained nearly 17 points, or 0.3%, to finish at 6,193. Tech made another backtest to the 6,150 level while kissing a low of 6,149 during the opening hours. Shaky support at 6,125-6,100 held before the half-point push past 6,200 ahead of the closing bell. Upper resistance at 6,175-6,200 held with continued closes above the latter a bullish signal. The close above the 50-day moving average at 6,171 was also a possible green light for higher highs this week.
The Russell 2000 climbed 4 points, or 0.3%, to close at 1,413. The small-caps stumbled to a low of 1,402 on the morning weakness with upper support at 1,400-1,395 holding for the third-straight session. Resistance at 1,415-1,420 held for the fourth-straight session with the index closing a half-point off its intraday high.
The S&P 500 Volatility Index ($VIX, 10.89, down 0.22) spiked to an intraday peak of 12.14 with resistance at 11.50-12.50 getting split. The late day low reached 10.68 with support at 10.75-10.50 holding.
From desk to press, futures look like this: Dow (+5); S&P 500 (-1); Nasdaq 100 (-1).
Momentum Options Play List
Closed Momentum Options Trades for 2017: 39-15 (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.
Bank of America (BAC, $24.60, down $0.29)
BAC August 25 calls (BAC170818C00025000, $0.58, down $0.12)
Entry Price: $0.75 (7/3/2017)
Exit Target: $1.50
Stop Target: None
Action: Lower support at $24.50 was breached on the backtest to $24.46 on Tuesday. Additional help is at $24.25-$24. Fresh resistance is at $24.75-$25.
AT&T (T, $36.60, down $0.23)
T August 37 puts (T170818P00037000, $0.95, up $0.15)
Entry Price: $0.78 (6/29/2017)
Exit Target: $1.60
Stop Target: 80 cents (Stop Limit)
Action: Set an initial Stop Limit at 80 cents.
Yesterday’s bottom reached $36.54 with lower support at $36.75-$36.50 holding. There is risk to $36-$35.50 on a move below the latter. Lowered resistance is at $36.75-$37.
TherapeuticsMD (TXMD, $4.99, up $0.19)
TXMD August 7.50 calls (TXMD170818C00007500, $0.40, up $0.05)
Entry Price: $0.50 (6/22/2017)
Exit Target: $1.00
Stop Target: None
Action: Yesterday’s peak tapped $5.70. However, resistance remains at $5-$5.25. Support is at $4.75 and the 50-day moving average.
iPath S&P 500 VIX Futures (VXX, 12.72, down 0.04)
VXX August 14 calls (VXX170818C00014000, $0.70, down $0.05)
Entry Price: $1.20 (6/15/2017)
Exit Target: $2.40
Stop Target: None
Action: Resistance at 13.25-13.50 was split following yesterday’s high of $13.34. Support at 12.75-12.50 held on the intraday low of 12.66.