Mid-Market Update for 10/18/2017

Micro-Caps Falter

12:40pm (EST)

The iShares Micro-Cap ETF (IWC) recently broke down out of a trading range between $95.75-$96.75 that lasted for seven trading sessions. The all-time high reached a peak of $96.77. Yesterday’s low reached $94.55 and represented the fourth-straight lower high and lower low. I mentioned earlier this month a close back below $96-$95.75 would likely lead to a continued backtest towards $94.50-$94 to retrace the gap higher from the beginning of the month. A close below the latter would be a continued bearish development.

Elsewhere, the Spiders S&P Homebuilders ETF (XHB) recently made a significant breakout to multiyear highs following the move above $39-$39.25 that represented June, August and early September resistance. Prior resistance had been at $38.50 and January 2007 resistance. The run to $40.67 represents the decade plus high with continued closes above $40-$40.25 being a bullish signal. The all-time high high is north of $46 that was reached in February 2006 and when XHB started trading. A move below current support at $40-$30.75 would be a bearish development.

Heading into the second half of trading, the Dow is up 149 points to 23,146 while the S&P 500 is adding 3 points to 2,562. The Nasdaq is advancing 9 points to 6,632 and the Russell 2000 is gaining 7 points to 1,505.

I have updated our current trades so let’s go check the tape.


Momentum Options Play List

Closed Momentum Options Trades for 2017: 49-20 (71%). 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, $12.22, down $0.05)

November 12 calls (F171117C00012000, $0.35, down $0.03)

Entry Price: $0.45 (10/11/2017)
Exit Target: $0.90
Return: -27%
Stop Target: None

Action: Support is at $12.10-$12. Resistance is at $12.40-$12.45.


Cypress Semiconductor (CY, $15.84, down $0.02)

CY November 16 calls (CY171117C00016000, $0.65, flat)

Entry Price: $0.45 (10/2/2017)
Exit Target: $0.90
Return: 44%
Stop Target: 55 cents (Stop Limit)

Action: Support is at $15.75-$15.50. Resistance is at $16-$16.25.


Limelight Networks (LLNW, $4.46, up $0.10)

LLNW ‪December 4‬ calls (LLNW171215C00004000, $0.65, up $0.10)

Entry Price: $0.37 (9/21/2017)
Exit Target: $0.80-$1.20
Return: 69%
Stop Target: None

Action: Resistance is at $4.50. Support is at $4.20. Earnings are due out after the closing bell.


TherapeuticsMD (TXMD, $4.82, down $0.04)

TXMD December 7.50 calls (TXMD171215C00007500, $0.20, flat)

Entry Price: $0.95 (8/17/2017)
Exit Target: $1.90
Return: -79%
Stop Target: None

Action: Resistance is at $5. Support is at $4.75-$4.70.