MomentumOptions.com Pre-Market Update for 8/10/2017

Small-Caps Close Below 1,400 Level

8:00am (EST)

The market fell for the second-straight session after trading down to near-term support on slightly heightened volatility. The small-caps led the way lower, followed by Tech, as the 10 major S&P sectors closed mixed. Consumer Discretionary (XLY) and Utilities were the weakest link while Consumer Staples and Healthcare led the slight gains.

The Dow declined 36 points, or 0.2%, to settle at 22,048. The blue-chips kissed a low of 21,996 intraday with upper support at 22,000-21,800 getting breached but holding. The run to 22,057 still kept the index in the red for the session with resistance at 22,200-22,250 holding and still in play.

The S&P 500 lost a point, or 0.04%, to end at 2,474. The index stumbled to a low of 2,462 after opening at 2,465 before holding support at 2,475-2,470. The recovery afterwards nearly reached positive territory with the bulls failing by a half-point on the session high into the close. Resistance remains at 2,485-2,500.

The Nasdaq fell 18 points, or 0.3%, to finish at 6,352. Tech traded down to 6,309 with lower support at 6,325-6,300 holding. The steady rebound to 6,355 into the closing bell failed resistance at 6,400-6,425 with the close above 6,350 keeping these levels in play.

The Russell 2000 was off 13 points, or 0.9%, to close at 1,397. The small-caps reached a low of 1,393 while closing below the 100-day moving average for the first time since late May. Fresh support is at 1,390-1,385. Lowered resistance is at 1,410-1,415 and the 50-day moving average.

The S&P 500 Volatility Index ($VIX, 11.11, up 0.15) stayed elevated throughout the session with the high reaching 12.63. I mentioned a close above 12.50 could induce panic selling and the close between resistance at 10.50-11.50 was a bearish development. Rising support is at 10.50-10.

From desk to press, futures look like this: Dow (-28); S&P 500 (-5); Nasdaq 100 (-14).

 

Momentum Options Play List

Closed Momentum Options Trades for 2017: 43-17 (72%). 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.

 

TiVo (TIVO, $18.30, down $0.05)

TIVO October 20 calls (TIVO171020C00020000, $0.70, flat)

Entry Price: $0.70 (8/8/2017)
Exit Target: $1.40
Return: 0%
Stop Target: None

Action: Resistance at $18.75-$19 held on Wednesday’s run to $18.70. Support is at $18.25-$18.

 

3D Systems (DDD, $12.83, up $0.14)

August 16 puts (DDD170818P00016000, $3.10, down $0.20)

Entry Price: $0.55 (8/2/2017)
Exit Target: $4 (Limit Order) (closed half @ $1.10 on 8/3/2017)
Return: 290% ($2.10 current avg. closing price)
Stop Target: $2.80 (Stop Limit)

Action: Upper support at $12.50-$12.25 held on yesterday’s low of $12.44. Resistance is at $12.75-$13. I could piggy-back this trade with September or October puts so stay tuned as shares could be headed towards $ 10. However, with these options expiring next Friday I would like to lock-in profits on the other half before opening a new position.

 

Wendy’s (WEN, $15.81, up $0.59)

WEN August 16 calls (WEN170818C00016000, $0.15, down $0.05)

Entry Price: $0.45 (7/12/2017)
Exit Target: $0.90
Return: -67%
Stop Target: None

Action: Resistance is at $15.75-$16. Support is at $15.50-$15.25. I would like to see shares clear and hold $16 today.

 

TherapeuticsMD (TXMD, $5.57, up $0.23)

TXMD August 7.50 calls (TXMD170818C00007500, $0.10, flat)

Entry Price: $0.50 (6/22/2017)
Exit Target: $1.00
Return: -80%
Stop Target: None

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