MomentumOptions.com Pre-Market Update for 7/13/2017

Dow Taps Fresh All-Time High

8:00am (EST)

One day doesn’t make a trend but the start of a summer rally appears to be underway following Wednesday’s breakout by the blue-chips. The other major indexes are closing on their all-time highs but the bulls need to show some follow through today. Volatility has below a key level of support and is on the verge of falling back into the single-digits.

The Dow jumped 123 points, or 0.6%, to end at 21,532. The blue-chips opened higher at 21,467 while trading to a lifetime high of 21,580. Upper resistance at 21,500-21,600 held with a run towards 21,800-22,000 if the latter is cleared. Support will try to hold at 21,350-21,300 on a pullback.

The S&P 500 soared 17 points, or 0.7%, to finish at 2,443. The index opened at 2,435 and a key level I have been mentioning that needed to clear. The run to 2,445 split additional hurdles at resistance at 2,440-2,450. The all-time high is at 2,453 and gets 2,475-2,500 in play on continued closes above 2,450. Support has moved up to 2,425-2,420.

The Nasdaq zoomed 67 points, or 1.1%, to close at 6,261. Tech made a steady push 6,265 late in the session to clear prior resistance at 6,200-6,175 and now fresh support. A move above 6,275 gets additional hurdles at 6,300-6,50 in the mix and lifetime highs north of 6,341.

The Russell 2000 advanced 11 points, or 0.8%, to settle at 1,424. The small-caps came within two points of its all-time high of 1,433. The index closed near upper resistance at 1,420-1,425 with continued closes above 1,430-1,435 likely leading to 1,440-1,450. Support is trying to move up to 1,415-1,410.

The S&P 500 Volatility Index ($VIX, 10.30, down 0.59) traded in the red throughout the session with the bulls pushing a low of 10.08. The close below lower support at 10.75-10.50 was a bullish sign and get 10-9.50 back on the map. Resistance has moved down to 11.25-11.50.

I have updated our two latest trades, CY and WEN, so let’s go check the details.

From desk to press, futures look like this: Dow (+14); S&P 500 (+2); Nasdaq 100 (+14).

 

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.

 

Cypress Semiconductor (CY, $13.97, up $0.20)

CY August 15 calls (CY170818C00015000, $0.40, up $0.05)

Entry Price: $0.40 (7/12/2017)
Exit Target: $0.80
Return: 0%
Stop Target: None

Action: Set an Exit Target at 80 cents.

Shares traded to a high of $14.05 yesterday to clear lower resistance at $14-$14.25. Rising support is at $13.75-$13.50.

 

Wendy’s (WEN, $15.69, down $0.11)

WEN August 16 calls (WEN170818C00016000, $0.45, down $0.05)

Entry Price: $0.45 (7/12/2017)
Exit Target: $0.90
Return: 0%
Stop Target: None

Action: Set an Exit Target at 90 cents.

Support is at $15.50-$15.25 with Wednesday’s low tapping $15.68. Resistance is at $15.75-$16. Earnings aren’t due out until August 9th.

 

Bank of America (BAC, $24.35, down $0.25)

BAC August 25 calls (BAC170818C00025000, $0.45, down $0.13)

Entry Price: $0.75 (7/3/2017)
Exit Target: $1.50
Return: -40%
Stop Target: None

Action: Support is at $24.25-$24. Yesterday’s low reached $24.30. Resistance is at $24.75-$25.

 

AT&T (T, $36.83, up $0.23)

T August 37 puts (T170818P00037000, $0.85, down $0.10)

Entry Price: $0.78 (6/29/2017)
Exit Target: $1.60
Return: 9%
Stop Target: 80 cents (Stop Limit)

Action: The puts tested a low of 82 cents yesterday.

Lowered resistance at $36.75-$37 was cleared on the high of $36.90. Support is at $36.75-$36.50.

 

TherapeuticsMD (TXMD, $5.00, up $0.01)

TXMD August 7.50 calls (TXMD170818C00007500, $0.40, flat)

Entry Price: $0.50 (6/22/2017)
Exit Target: $1.00
Return: -20%
Stop Target: None

Action: Resistance is at $5.25-$5.50. Rising support is at $5-$4.75.

 

iPath S&P 500 VIX Futures (VXX, 12.37, down 0.34)

VXX August 14 calls (VXX170818C00014000, $0.55, down $0.15)

Entry Price: $1.20 (6/15/2017)
Exit Target: $2.40
Return: -54%
Stop Target: None

Action: Fresh support is at 12.25-12. Resistance is at 12.50-12.75.