Mid-Market Update for 8/22/2017

Bulls Trying to Bounce Back

12:35pm (EST)

August is typically a volatile month with whipsaw action that may, or may not, be a signal of longer-term trends. With traders on vacation and back-to-school preparations, volume has been light and has attributed to some of the violent moves we have seen in recent weeks.

While there have been opportunities to go short, the recent pullback could also be setting up for another buying opportunity. It is also extremely hard to trade whipsaw action as decisions are needed on possibly an hourly basis. These types of environments, along with trading ranges can eat away at a trading account if you aren’t careful.

It is also important to note September options expire in roughly three weeks and often times what I call a danger zone for option traders. This is why I have used October and December options for our current trades. This allows more time for trades to play out.

I have also mentioned the Watch List is full of option trades both bullish and bearish. However, there is math required, trends to study, research to do, and possible events to plan for, like earnings. This is what makes trading exciting to me and why I try to put smart money to work.

Option trading also requires you to be right in a more specific time frame, especially when trading near-term call and put options. I also try to use “cheap” options during times of volatility and when a clear trend isn’t present. These means I tend to trade options for less than $1 a contract but I also don’t want to overpay or buy options that are too far out-of-the-money.

I wanted to explain all of this because it is an important aspect of my trading and what I’m currently seeing. With that said, I still plan to open 1-2 new trades this week but please realize the environment we are in.

The Dow is jumping 153 points to 21,857 while the S&P 500 is adding 20 points to 2,448. The Nasdaq is gaining 75 points to 6,289 and the Russell 2000 is higher by 11 points to 1,368.

I have updated our current trades. Stay locked-and-loaded into the closing bell in case I take action on a New Trade.


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, $6.10, up $0.15)

TXMD December 7.50 calls (TXMD171215C00007500, $0.70, flat)

Entry Price: $0.95 (8/17/2017)
Exit Target: $1.90
Return: -29%
Stop Target: None

Action: Resistance is at $6.25-$6.50. Support is at $6-$5.75.


Intel (INTC, $34.76, down $0.16)

INTC October 37 calls (INTC171020C00037000, $0.20, down $0.05)

Entry Price: $0.53 (8/15/2017)
Exit Target: $1.10
Return: -65%
Stop Target: None

Action: Support is at $34.75-$34.50. Resistance is at $35-$35.25.


TiVo (TIVO, $18.55, up $0.05)

TIVO October 20 calls (TIVO171020C00020000, $0.60, flat)

Entry Price: $0.70 (8/8/2017)
Exit Target: $1.40
Return: -13%
Stop Target: None

Action: Lowered resistance at $18.50-$18.75 held on yesterday’s run to $18.60. Rising support is at $18.25-$18.