Pre-Market Update for 10/17/2017

Record Highs Still in Play/ Trade Alert (TIVO)

8:00am (EST)

The market showed continued momentum to start the week with the Dow, S&P 500, and Nasdaq reaching fresh all-time highs throughout the session. The Russell 2000 also showed strength on the open but failed upper resistance while closing slightly higher. The index briefly fell below 1,500 intraday but was able to hold this level into the closing bell.

The Dow jumped 84 points, or 0.4%, to close just below 22,957. The blue-chips held positive territory throughout the session while reaching an all-time high of 22,960. Upper resistance at 22,850-23,000 was challenged with a move above the latter getting 23,200-23,250 in play. Rising support is at 22,700-22,650.

The S&P 500 climbed 4 points, or 0.2%, to settle at 2,557. The index traded to a record high of 2,559 shortly after the open with lower resistance at 2,560-2,575 holding by a half-point. The intraday fade to 2,552 held rising support at 2,550-2,540.

The Nasdaq gained 13 points, or 0.3%, to finish at 6,624. Tech sailed to a peak of 6,632 an hour into trading to clear lower resistance at 6,625-6,650. Support remains at 6,575-6,550 on a move below 6,600.

The Russell 2000 rose less than a point, or 0.0%, to end at 1,502. The small-caps made a run to 1,511 at the start of Monday’s action with resistance at 1,515-1,525 holding. Upper support at 1,500-1,490 was breached on the backtest to 1,499 midday. A move below the latter would be a bearish development.

The S&P 500 Volatility Index ($VIX, 9.91, up 0.30) stayed elevated throughout the session while topping out at 10.02. Lower resistance at 10.50-11.50 held with a move above the latter signaling a short-term market top. Support remains at 9.75-9.50.

I have a couple of trades I’m watching as possible candidates. One is IWM on a move below 1,495 on the Russell 2000 and the other is a bearish trade on a company announcing earnings next week, SFLY. If the Russell 2000 clears 1,515, I could use call options to play a breakout to fresh all-time highs. Stay locked-and-loaded in case I take action. I’m also closing TIVO this morning to save some premium.


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.


Ford (F, $12.12, up $0.07)

November 12 calls (F171117C00012000, $0.30, flat)

Entry Price: $0.45 (10/11/2017)
Exit Target: $0.90
Return: -33%
Stop Target: None

Action: Lower resistance at $12.15-$12.20 held on yesterday’s peak. Support is at $12-$11.75.


Cypress Semiconductor (CY, $15.88, up $0.02)

CY November 16 calls (CY171117C00016000, $0.70, flat)

Entry Price: $0.45 (10/2/2017)
Exit Target: $0.90
Return: 56%
Stop Target: 55 cents (Stop Limit)

Action: Monday’s high tapped $15.94. Resistance is at $16-$16.25. Support is at $15.75-$15.50.


Limelight Networks (LLNW, $4.32, down $0.03)

LLNW ‪December 4‬ calls (LLNW171215C00004000, $0.55, flat)

Entry Price: $0.37 (9/21/2017)
Exit Target: $0.80-$1.20
Return: 49%
Stop Target: None

Action: Earnings are due out Wednesday. The company has topped estimates by two-cents, twice, and a penny over the past three quarters. Support is at $4.20 followed by $4-$3.90. Resistance is at $4.50.


TherapeuticsMD (TXMD, $4.85, up $0.27)

TXMD December 7.50 calls (TXMD171215C00007500, $0.20, up $0.05)

Entry Price: $0.95 (8/17/2017)
Exit Target: $1.90
Return: -78%
Stop Target: None

Action: Lower resistance at $4.75-$5 was cleared on yesterday’s run to $4.87. Support remains at $4.50.

TiVo (TIVO, $18.65, up $0.05)

TIVO ‪October 20‬ calls (TIVO171020C00020000, $0.10, down $0.05)

Entry Price: $0.70 (8/8/2017)
Exit Target: $1.40
Return: -86%
Stop Target: None

Action: Close the trade this morning to save the remaining premium.