Mid-Market Update for 8/3/2017

Earnings Parade Continues

3:05pm (EST)

It has been a busy day, and week, with earnings so this update is short as I’m also writing, trading, and updating my Watch List. Here is a peak at upcoming earnings with some of the names as prime candidates for possible trades.

Activision Blizzard (ATVI), Blue Bird (BLBD), Caesars Entertainment (CZR), Etsy (ETSY), I.D. Systems (IDSY), Kraft Heinz (KHC), (OSTK), Veeco Instruments (VECO) after today’s close.

CBOE Holdings (CBOE), Cooper Tire & Rubber (CTB), Potbelly (PBPB), Vector Group (VGR) are reporting ahead of Friday’s open.

Caesars Entertainment (CZR) could make a major move. The CZR August 12.50 calls (CZR170818C00012500, $0.30, up $0.05) and the CZR August 11.50 puts (CZR170818P00011500, $0.30, flat) can be targeted by bullish and bearish traders. Both options together would create a strangle option trade for 60 cents.

If CZR shares trade above $13.70, or falls below $10.30, by August 18th, the total premium for the call or put would be worth $1.20. I like earnings trades but I only take a few during each quarterly season given the risk. The rewards are great when they work in your favor but CZR just seems too risky to take a directional trade without a hedge given their choppy earnings history.

Either way, I’m going to be on the sidelines as there are better opportunities developing without adding the extra risk on a stock I don’t actively follow.

Heading into second half of trading, the Dow is up 13 points to 22,029 while the S&P 500 is off 5 points to 2,472. The Nasdaq is lower by 16 points to 6,346 and the Russell 2000 is sliding 6 points to 1,406.

A stock I do actively follow is DDD and we got some good news this morning after locking-in half profits as shares continued to pull back.


Momentum Options Play List

Closed Momentum Options Trades for 2017: 42-17 (71%). 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.


3D Systems (DDD, $13.32, down $3.71)

August 16 puts (DDD170818P00016000, $2.50, up $1.90)

Entry Price: $0.55 (8/2/2017)
Exit Target: $1.10 (closed half @ $1.10 on 8/3/2017)
Return: 209%
Stop Target: $1.00 (Stop Limit)

Action: Set an initial Stop Limit at $1.00. I will adjust it in the morning.

The puts opened at $1.10 and are at session highs.

The company posted a loss of 8 cents and expects full-year earnings to come in at $0.46 a share. This was exactly what my research was banking on.


Alcoa (AA, $37.15, down $0.13)

AA August 39 calls (AA170818C00039000, $0.40, flat)

Entry Price: $0.55 (7/25/2017)
Exit Target: $1.10
Return: -27%
Stop Target: None

Action: Support is at $36.50-$37. Resistance is at $37.50-$37.75.


Wendy’s (WEN, $15.34, down $0.11)

WEN August 16 calls (WEN170818C00016000, $0.25, flat)

Entry Price: $0.45 (7/12/2017)
Exit Target: $0.90
Return: -44%
Stop Target: None

Action: Support is at $15.25-$15. Resistance is at $15.50-$15.75.


TherapeuticsMD (TXMD, $5.40, down $0.16)

TXMD August 7.50 calls (TXMD170818C00007500, $0.20, flat)

Entry Price: $0.50 (6/22/2017)
Exit Target: $1.00
Return: -60%
Stop Target: None

Action: Support is at $5.25-$5. Resistance is at $5.50-$5.75.