Pre-Market Update for 7/18/2017

Small-Caps Set Fresh Record High

8:00am (EST)

The market traded in an extremely tight range to start the week while closing mixed with slight gains and losses. The small-caps tested a fresh all-time high with the broader market falling just shy of record highs. Financial stocks were mixed and the Transports pulled back while Mining stocks edged higher. Tech held positive territory after the Nasdaq missed setting a lifetime high by 11 points.

The Dow slipped 8 points, or 0.04%, to settle at 21,629. The blue-chips tested a low of 21,617 shortly after the open with rising support at 21,600-2 1,550 holding. Backup help is at 21,400-21,350 with a move below the latter signaling a short-term top. Fresh resistance at 21,800-22,000 held on the intraday run to 21,661. The 44-point range was the slimmest since late 2013.

The S&P 500 dipped a tenth-point, or 0.01%, to end at 2,459. The index kissed 2,457 on the morning open with the 2-point loss holding support at 2,450-2,445. A move back below 2,435 would be a bearish development. The push to 2,462 held resistance at 2,475-2,500.

The Nasdaq added 2 points, or 0.03%, to finish at 6,314. Tech traded up to 6,330 during the first half of action with lower resistance at 6,340-6,350 easily holding. Support is trying to move up to 6,300-6,250 following the second half backtest to 6,307.

The Russell 2000 climbed nearly 3 points, or 0.2%, to close at 1,431. The small-caps held upper support at 1,425-1,420 on the opening low with a close below 1,415 now our warning sign a possible peak is in. The rebound past 1,434 set a fresh all-time high with new resistance now at 1,450-1,460.

The S&P 500 Volatility Index ($VIX, 9.82, up 0.31) stayed slightly elevated throughout the session after opening at 9.77. The high reached 10.03 with resistance at 10.50-10.75 holding. Support remains at 9.50 with a move below the 52-week low of 9.37 leading to 9.25-9.


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, $14.29, down $0.18)

CY August 15 calls (CY170818C00015000, $0.50, down $0.10)

Entry Price: $0.40 (7/12/2017)
Exit Target: $0.80
Return: 25%
Stop Target: None

Action: Support at $14.25-$14 held following yesterday’s low of $14.18. Resistance remains at $14.50-$14.75.


Wendy’s (WEN, $15.66, up $0.02)

WEN August 16 calls (WEN170818C00016000, $0.45, flat)

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

Action: Lower resistance at $15.75-$16 held on Monday’s run to $15.74. Support is at $15.50-$15.25.


Bank of America (BAC, $24.02, down $0.19)

BAC August 25 calls (BAC170818C00025000, $0.30, down $0.05)

Entry Price: $0.75 (7/3/2017)
Exit Target: $1.50
Return: -60%
Stop Target: None

Action: Support is at $24-$23.75 with Monday’s low tapping $23.93. Resistance is at $24.50-$24.75. Earnings are due out this morning.


AT&T (T, $36.39, up $0.09)

T August 37 puts (T170818P00037000, $1.10, down $0.05)

Entry Price: $0.78 (6/29/2017)
Exit Target: $1.60
Return: 41%
Stop Target: $1.05 (Stop Limit)

Action: The Stop Limit held on yesterday’s low of $1.07 but will likely trip on a move above $36.50.

Shares tested a high of $36.45 with lower resistance at $36.50-$36.75 holding by a nickel. Support is at $36.


TherapeuticsMD (TXMD, $5.26, down $0.37)

TXMD August 7.50 calls (TXMD170818C00007500, $0.25, down $0.20)

Entry Price: $0.50 (6/22/2017)
Exit Target: $1.00
Return: -50%
Stop Target: None

Action: Upper support at $5.25-$5 held despite the low reaching $4.69 on the open. Resistance is at $5.50.

The company had mixed reviews after news on the status of its New Drug Application for TX-004HR was not viewed as positive. However, a couple of analysts defended the stock with Price Targets of $20 and $33 so stay tuned as a resubmission could come in as little as a couple of weeks.


iPath S&P 500 VIX Futures (VXX, 11.70, down 0.32)

VXX August 14 calls (VXX170818C00014000, $0.35, down $0.05)

Entry Price: $1.20 (6/15/2017)
Exit Target: $2.40
Return: -71%
Stop Target: None

Action: Fresh support is at 11.50-11.25 following yesterday’s drop to a 52-week low of 11.66. Resistance is at 11.75-12.