Pre-Market Update for 7/26/2017

Small-Caps Lead Charge to Record Highs

8:00am (EST)

The bulls showed continued momentum as the major indexes made another run at record highs. Financial stocks showed major strength along with a bounce back in retail. Volatility is still being compressed with the VIX once again hitting another all-time low of 9.04. The Dow will try to rejoin the race toward record highs after the S&P 500, Nasdaq, and Russell 2000, all, reached historic intraday peaks.

The Dow jumped 100 points, or 0.5%, to finish at 21,613. The blue-chips held positive territory throughout the session while clearing and holding the 21,600 level. Resistance at 21,675-21,700 held on the intraday run to 21,670. A move above the latter gets 21,800-22,000 in play. Support remains at 21,400-21,350 if 21,600-21,550 fails to hold.

The S&P 500 added 7 points, or 0.3%, to close at 2,477. The index opened at 2,477 and closed above lower resistance at 2,475-2,500 while reaching an intraday peak at 2,481. This was a bullish sign as long as 2,475-2,470 holds the rest of the week. If not, support is at 2,460-2,450.

The Nasdaq climbed a point, or 0.02%, to settle at 6,412. Tech struggled in negative territory throughout the session but fell only 14 points to 6,396 on the morning low. Support is trying to move up to 6,375-6,350. Fresh resistance at 6,450-6,500 continues to be in focus with the rebound to 6,425 afterwards.

The Russell 2000 soared a dozen points, or 0.9%, to end at 1,450. The small-caps started slow on the point higher open but maintained green throughout the session. Upper resistance at 1,445-1,450 was cleared and held into the closing bell on the all-time intraday peak north of 1,452. Support is trying to move up to 1,435-1,430.

The S&P 500 Volatility Index ($VIX, 9.43, flat) tested another historic low of 9.04 midday with lower support at 9.25-9 holding. Resistance remains at 10-10.50.

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


Momentum Options Play List

Closed Momentum Options Trades for 2017: 41-16 (71xx%). 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.


Alcoa (AA, $37.30, up $0.61)

AA August 39 calls (AA170818C00039000, $0.55, up $0.15)

Entry Price: $0.55 (7/25/2017)
Exit Target: $1.10
Return: 0%
Stop Target: None

Action: Resistance is at $37.50-$38. Tuesday’s high reached $37.38. Support is at $37-$36.75.


Imax (IMAX, $21.70, up $0.20)

IMAX August 21 puts (IMAX170818P00021000, $0.65, down $0.05)

Entry Price: $0.78 (7/21/2017)
Exit Target: $1.60
Return: -17%
Stop Target: None

Action: Resistance is at $21.75-$22 with yesterday’s high reaching $21.85. Support is at $21.25-$21.


Wendy’s (WEN, $15.95, up $0.17)

WEN August 16 calls (WEN170818C00016000, $0.50, up $0.05)

Entry Price: $0.45 (7/12/2017)
Exit Target: $0.90
Return: 11%
Stop Target: None

Action: Lower resistance at $16-$16.25 held on Tuesday’s run to $15.99. Support is at $15.75.


TherapeuticsMD (TXMD, $5.80, down $0.09)

TXMD August 7.50 calls (TXMD170818C00007500, $0.25, flat)

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

Action: Yesterday’s low tapped $5.56. Support is at $5.75-$5.50. Resistance is at $6-$6.25.


iPath S&P 500 VIX Futures (VXX, 11.06, up 0.05)

VXX August 14 calls (VXX170818C00014000, $0.15, flat)

Entry Price: $1.20 (6/15/2017)
Exit Target: $2.40
Return: -88%
Stop Target: 10 cents (Stop Limit)

Action: Support is at 11. Resistance is at 11.25-11.50.