MomentumOptions.com Pre-Market Update for 10/20/2017
Market Recovers Early Losses
The market closed mixed on Thursday after battling back from early morning losses of roughly 1%. The Dow and S&P 500 extended their winning streaks to five-straight after gaining positive territory ahead of the closing bell. The Russell 2000 also rebounded off its morning low to trade into positive territory before finishing slightly lower while holding the 1,500 level. Meanwhile, the Nasdaq was the weakest link, after falling 0.3%, but was able to hold the 6,600 level.
The Dow gained 5 points, or 0.02%, to end at 23,162. The blue-chips stumbled to a low of 23,052 with upper support at 23,000-22,800 holding. The rebound to 23,167 fell shy of the all-time high by 4 points and resistance at 23,250.
The S&P 500 added nearly a point, or 0.03%, to close at 2,562. The index tested to a low of 2,547 to breach upper support at 2,550-2,540. Lower resistance at 2,560-2,575 held into the closing bell with the S&P closing a quarter-point off its high.
The Nasdaq fell 19 points, or 0.3%, to settle at 6,605. Tech traded in negative territory throughout the session while tapping a low of 6,558. Lower support at 6,600-6,575 was breached with a close below 6,550 being a bearish development. Resistance remains at 6,625-6,650.
The Russell 2000 slipped 3 points, or 0.2%, to finish at 1,502. The small-caps kissed a low of 1,491 with lower support at 1,500-1,490 holding. Resistance at 1,515-1,525 held on the push to 1,507 intraday.
The S&P 500 Volatility Index ($VIX, 10.07, down 0.24) soared past upper resistance at 10.50-11.50 following the morning high of 11.72. Support at 9.75-9.50 held on the late day fade to 9.99.
I have set an initial Stop Limit on LLNW so adjust your trading accounts accordingly.
Momentum Options Play List
Closed Momentum Options Trades for 2017: 50-20 (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, $12.23, up $0.04)
November 12 calls (F171117C00012000, $0.35, flat)
Entry Price: $0.45 (10/11/2017)
Exit Target: $0.90
Stop Target: None
Action: Resistance is at $12.40-$12.45 with yesterday’s high reaching $12.25. Support is at $12.10-$12.
Limelight Networks (LLNW, $4.71, up $0.23)
LLNW December 4 calls (LLNW171215C00004000, $0.85, up $0.25)
Entry Price: $0.37 (9/21/2017)
Exit Target: $1.20 (Limit Order on half at $1.20)
Stop Target: 50 cents (Stop Limit)
Action: Set an initial Stop Limit at 50 cents to start protecting profits.
Shares traded to a 52-week of $4.98 yesterday with the options testing a high of $1.02. Fresh resistance is at $4.75-$5. Rising support is at $4.40-$4.35.
The company reported a profit of $0.02, versus expectations for a flat quarter. Revenue came in at $46.1 million, topping forecasts of $43.1 million. Limelight Networks also raised full year profit and revenue guidance. Two analysts upped their price targets from $4 and $5.50 to $6.
TherapeuticsMD (TXMD, $4.85, up $0.05)
TXMD December 7.50 calls (TXMD171215C00007500, $0.20, flat)
Entry Price: $0.95 (8/17/2017)
Exit Target: $1.90
Stop Target: None
Action: Resistance is at $5. Support is at $4.75-$4.70.