Pre-Market Update for 10/5/2017

Small-Caps Slip

8:00am (EST)

The market continued its push towards all-time highs on Wednesday’s open but settled the session mixed with the Russell 2000 closing lower. The Dow, S&P 500, and Nasdaq went out at record highs but the gains were limited following the recent breakouts. There could be a slight trading range developing ahead of the start of 3Q earnings season as overbought levels consolidate into next week.

The Dow gained 20 points, or 0.1%, to settle at 22,661. The blue-chips kissed a morning low of 22,632 with support at 22,400-22,350 easily holding. These levels will come into play on a move below 22,600. Resistance at 22,750-22,800 held on the intraday run to 22,685.

The S&P 500 climbed 5 points, or 0.2%, to finish at 2,534. The index was slightly weak on the open after tapping 2,531 with support at 2,510-2,500 coming into play if 2,525 fails. Resistance at 2,550-2,560 held on the push to 2,540 afterwards.

The Nasdaq climbed 3 points, or 0.04%, to end at 6,534. Tech made a backtest to 6,513 shortly after the opening bell with support at 6,475-6,450 coming into play on a move below 6,500. Lower resistance at 6,550-6,575 came into play on the rebound to 6,546.

The Russell 2000 fell 4 points, or 0.3%, to close at 1,507. The small-caps peaked intraday at a record 1,514 to challenge lower resistance at 1,515-1,525. The reversal to 1,505 held support is at 1,500-1,490.

The S&P 500 Volatility Index ($VIX, 9.63, up 0.06) closed higher for the second-straight session with yesterday’s high reaching 9.88. Lower resistance at 10-10.50 held with a move above the latter being a slightly bearish development. Support remains at 9.50-9.25. VIX call options outpaced puts nearly 6:1.

I have updated our current trades 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, $15.41, down $0.01)

CY November 16 calls (CY171117C00016000, $0.50, down $0.05)

Entry Price: $0.45 (10/2/2017)
Exit Target: $0.90
Return: 11%
Stop Target: None

Action: Support at $15.25-$15 held on yesterday’s fade to $15.28. Resistance is at $15.50-$15.75.


Limelight Networks (LLNW, $4.36, up $0.17)

LLNW ‪December 4‬ calls (LLNW171215C00004000, $0.60, up $0.10)

Entry Price: $0.37 (9/21/2017)
Exit Target: $0.80-$1.20
Return: 61%
Stop Target: None

Action: Fresh resistance is at $4.50 following Tuesday’s run to $4.40 and fresh 52-week high. Rising support is at $4.25-$4.20.


TherapeuticsMD (TXMD, $5.13, up $0.12)

TXMD December 7.50 calls (TXMD171215C00007500, $0.25, flat)

Entry Price: $0.95 (8/17/2017)
Exit Target: $1.90
Return: -73%
Stop Target: None

Action: Resistance is at $5.25. Support is at $5-$4.75.

TiVo (TIVO, $19.60, down $0.15)

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

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

Action: Support is at $19.50-$19.25. Resistance is at $20-$20.25.