Pre-Market Update for 8/18/2017

Small-Caps, Mid-Caps Get Whacked

8:00am (EST)

The market stayed underwater throughout Thursday’s session with the weakness being attributed to the political fallout from the disbanding of the President’s business advisory panel. Other rhetoric on the fate of Trump’s staff came into play along with concerns raised by the Fed about the nation’s inflation rate. The pullback was led by Technology and the Industrials as all of the major sectors finished lower.

The Dow sank 274 points, or 1.2%, to finish at 21,750. The blue-chips opened below the 22,000 level at 21,984 while going out at the session low. Lower support at 21,800-21,750 held with risk to 21,600-21,550 and the 50-day moving average on continued weakness. Lowered resistance is at 21,800-22,000.

The S&P 500 tanked 38 points, or 1.5%, to close at 2,430. The index opened 6 points lower at 2,462 with backup support at 2,425-2,415 and the 100-day moving average holding into the closing bell. There is additional risk to 2,400 on a move below the latter. Resistance is at 2,445-2,450 and the 50-day moving average.

The Nasdaq tumbled 123 points, or 1.9%, to settle at 6,22 1. Tech was the weakest link of the major indexes with backup support at 6,225-6,200 coming into play. There is additional risk and stretch to 6,150-6,100 and the 100-day moving average on a move below the latter. Resistance is at 6,250-6,300 ahead of the weekend.

The Russell 2000 stumbled 24 points, or 1.8%, to end at 1,358. The small-caps traded higher on the open by a point to 1,384 before ending a tenth-point off the session low. May support at 1,360-1,350 held on the backtest with additional risk to 1,340-1,335 and the late March lows.

The S&P 500 Volatility Index ($VIX, 15.55, up 3.81) surged 32% after kissing 15.77 ahead of the closing bell. Renewed resistance at 15-17.50 is back in play with a move above the latter leading to another round of panic selling. Support is at 14.50-14.

From desk to press, futures look like this: Dow (+13); S&P 500 (+3); Nasdaq 100 (+16).


Momentum Options Play List

Closed Momentum Options Trades for 2017: 44-19 (70%). 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.


TherapeuticsMD (TXMD, $6.29, up $0.35)

TXMD December 7.50 calls (TXMD171215C00007500, $0.95, up $0.30)

Entry Price: $0.95 (8/17/2017)
Exit Target: $1.90
Return: 0%
Stop Target: None

Action: Shares traded to a high of $6.74 yesterday with fresh resistance at $6.50-$6.75 holding. Support is at $6-$5.75. I will have a more detailed write-up next week on the company and the current developments.


Intel (INTC, $35.17, down $0.64)

INTC October 37 calls (INTC171020C00037000, $0.38, down $0.09)

Entry Price: $0.53 (8/15/2017)
Exit Target: $1.10
Return: -26%
Stop Target: None

Action: Support is at $35-$34.75 with shares ending at the session low. Lowered resistance is at $35.25-$35.50.


TiVo (TIVO, $18.10, down $0.40)

TIVO October 20 calls (TIVO171020C00020000, $0.60, down $0.05)

Entry Price: $0.70 (8/8/2017)
Exit Target: $1.40
Return: -14%
Stop Target: None

Action: Yesterday’s low tapped $18.05. Support is at $18-$17.75. Resistance is at $18.50-$18.75.