Pre-Market Update for 10/3/2017

Broad-Based Rally Continues

8:00am (EST)

The market started the month of October and the beginning of 4Q on a strong note with the Dow breaking out to a fresh all-time high. The S&P 500, Nasdaq, and Russell 2000 continued their record runs along with the mid-caps that are also showing strong momentum. This is suggesting a broader based rally and is typically a bullish signal for the market.

The Dow jumped 152 points, or 0.7%, to end at 22,557. The blue-chips held positive territory from the open while trading to an all-time high of 22,559 into the close. The close above upper resistance at 22,400-22,500 was bullish and gets fresh hurdles at 22,750-22,800 in play. Rising support is now at 22,350-22,300.

The S&P 500 added 9 points, or 0.4%, to close at 2,529. The index closed at its session and another lifetime high while clearing upper resistance at 2,510-2,525. Continued closes above the latter could lead to a possible run towards 2,550-2,560. Support remains at 2,500-2,490.

The Nasdaq gained 20 points, or 0.3%, to settle at 6,516. Tech tested an all-time of 6,527 shortly after the open while closing above upper resistance at 6,475-6,500. Continued closes above this level could lead to a run towards 6,550-6,575. The backtest to 6,484 held rising support is at 6,450-6,425.

The Russell 2000 surged 18 points, or 1.3%, to finish at 1,509. The small-caps opened a point higher at 1,491 while making a steady run into the closing bell to another record high. Upper resistance at 1,500-1,515 held with a move above the latter opening up fluff to 1,525. Fresh support is at 1,490-1,485.

The S&P 500 Volatility Index ($VIX, 9.45, down 0.06) traded up to 10.04 on the open with lowered resistance at 10-10.50 getting slightly stretched. The close below upper support at 9.50-9.25 gets the 52-week low at 8.84 in play.

I have updated the parameters from our CY trade from yesterday so let’s go check the tape.


Momentum Options Play List

Closed Momentum Options Trades for 2017: 49-19 (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.


Cypress Semiconductor (CY, $15.31, up $0.29)

CY November 16 calls (CY171117C00016000, $0.50, up $0.10)

Entry Price: $0.45 (10/2/2017)
Exit Target: $0.90
Return: 10%
Stop Target: None

Action: Fresh resistance is at $15.50-$15.75 following yesterday’s run to a 52-week high of $15.32. Rising support is at $15-$14.75.


Limelight Networks (LLNW, $4.09, up $0.12)

LLNW ‪December 4‬ calls (LLNW171215C00004000, $0.40, flat)

Entry Price: $0.37 (9/21/2017)
Exit Target: $0.80-$1.20
Return: 9%
Stop Target: None

Action: Resistance is at $4.20-$4.25 with Monday’s high tapping $4.10. Support is at $3.90-$3.75.


TherapeuticsMD (TXMD, $5.16, down $0.13)

TXMD December 7.50 calls (TXMD171215C00007500, $0.30, flat)

Entry Price: $0.95 (8/17/2017)
Exit Target: $1.90
Return: -69%
Stop Target: None

Action: Support is at $5. Resistance is at $5.50.

TiVo (TIVO, $19.85, flat)

TIVO ‪October 20‬ calls (TIVO171020C00020000, $0.75, flat)

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

Action: Shares traded to a high of $20.17 yesterday. Resistance is at $20-$20.25. Support is at $19.50-$19.25.