MomentumOptions.com Pre-Market Update for 1/20/2023
Nasdaq/ S&P Close Below 50-Day MA’s
8:00am (EST)
The stock market extended its losing streak to three-straight sessions, overall, following Thursday’s dip to lower lows. The small-caps held its major moving averages but remains in a precarious position on continued weakness.
The Russell 2000 traded to a low of 1,825 before going out at 1,836 (-1%). New and upper support at 1,825-1,800 and the 200-day/ 50-day moving averages were challenged but held. A drop below these levels would indicate ongoing weakness towards 1,775-1,750. Below is a chart of the IWM.
The Nasdaq ended at 10,852 (-1%) and back below its 50-day moving average with the intraday low kissing 10,804. Upper support at 10,900-10,750 failed to hold. A move below the latter would imply a further slide to 10,650-10,500.
The S&P 500 settled at 3,898 (-0.8%) after testing a low of 3,885 while failing to hold its 50-day moving average, as well. Fresh and upper support at 3,900-3,875 was tripped and failed to hold. A fade below the latter would suggest additional weakness towards 3,825-3,800.
The Dow tapped a second half low of 32,982 while finishing at 33,044 (-0.8%). Key support at 33,000 was breached but held. A close below this level latter would signal weakness towards 32,750-32,500 and the 200-day moving average.
Volatility Index
The Volatility Index (VIX) extended its winning streak to three-straight sessions following the push to 21.71. Prior and lower resistance at 21.50-22 was cleared but held. A move above the latter and the 50-day moving average would suggest a retest to 23.50-24.
Support is at 20-19.50.
Momentum Options Play List
Closed Momentum Options Trades for 2023: 3-0 (100%). 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.
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CSX (CSX, $31.55, down $0.68)
CSX February 33 calls (CSX230203C00033000, $0.40, down $0.20)
Entry Price: $0.75 (1/9/2023)
Exit Target: $1.50
Return: -45%
Stop Target: None
Action: New and upper support at $31.75-$31.50 failed to hold on the tumble to $31.52. A close below the latter and the 50-day moving average would likely push us to the sidelines. Lowered resistance is at $32-$32.25.
