MomentumOptions.com Pre-Market Update for 3/28/2024

S&P Snaps Three-Session Slide

8:00am (EST)

Commentary

The stock market closed higher across the board for the first time this week with the major indexes back within striking distance of lifetime highs. Meanwhile, volatility is once again at a key support level as Wall Street winds down the final trading day of the month.

The Nasdaq made a push to 16,431 before settling at 16,399 (+0.5%). Lower resistance at 16,300-16,450 was topped and held. A close above the latter would suggest continued upside to 16,500-16,650. Support is at 16,250-16,100.

The S&P 500 went out at 5,248 (+0.9%) after testing a high of 5,249. Key resistance at 5,250 was challenged and held. A move above this level and the recent 52-week peak at 5,261 would imply further strength to 5,300-5,350. Support is at 5,200-5,150.

The Dow kissed 39,769 while finishing at 39,760 (+1.2%). Key resistance at 39,750 was recovered. Continued closes above this level would indicate additional gains towards 40,000-40,250 and new record highs. Support is at 39,250-39,000.

Volatility Index

The Volatility Index (VIX) tapped a low of 12.66 with upper support at 13-12.50 getting reclaimed. A move above the latter and the 50-day moving average would signal another push to 14.50-15 and the 200-day moving average. Support is at 12.75-12.25.

Thursday’s earnings announcements:

Before the open: Consolidated Water (CWCO), Hut 8 Mining (HUT), Walgreens Boots Alliance (WBA)

After the close: Energous (WATT), Oxford Industries (OXM), Semtech (SMTC), Wrap Technologies (WRAP)

Economic news:

Initial Jobless Claims – 8:30am
GDP – 8:30am
Pending Home Sales Index – 10:00am

Market Thoughts

The biggest development from yesterday was the action in the small-caps as the Russell came within a point of setting a new monthly and 2024 high. Also in play are fresh 52-week highs on continued closes above 2,115.

The close at 12.78 on the VIX once again held key support at 12.75. We have highlighted continued closes below this level keeps all-time highs in focus. The bulls could push 11.75 and fresh 52-week lows on continued closes below 12.50 and last Thursday’s low at 12.40.

The RSI (relative strength index) levels for the major indexes are back in the 60’s and turning higher so there is slightly bullish as they were headed for key support at 50. The adjusted uptrend lines are still holding and the bullish thesis continues as we wrap up March and look forward to April.

We will have an updated video and outlook on Monday with today’s update short and to the point. We could still have New Trades or Alerts today to get a jump ahead of next week so stay locked-and-loaded. The market is closed on Friday so enjoy the Holiday weekend.

Momentum Options Play List

Closed Momentum Options Trades for 2024: 19-3 (86%). 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 “Stops” entered to close any trades or “Limit Orders” in your brokerage account unless we list one. We will send out a “Profit Alert” or “New Trade” if we want you to close a position or if a new trade comes out. Otherwise, follow instructions at all times in the Otherwise, follow instructions at all times in the‬ updates on Monday’s and Thursday’s‬ along with the Text Alerts throughout the week.

Teva Pharmaceuticals (TEVA, $14.43, up $0.29)

TEVA May 15 calls (TEVA240517C00015000, $0.60, up $0.05)

Entry Price: $0.45 (3/25/2024)
Exit Target: $0.90
Return: 33%
Stop Target: 47 cents (Stop Limit)

TEVA June 15 calls (TEVA240621C00015000, $0.75, up $0.05)

Entry Price: $0.65 (3/25/2024)
Exit Target: $1.30
Return: 14%
Stop Target: 67 cents (Stop Limit)

Action: Set Stop Limits at 47 cents and 67 cents, respectively.

Fresh and lower resistance at $14.25-$14.50 was cleared and held with Wednesday’s 52-week peak at $14.45. Rising and key support is at $14 which had served as resistance throughout the month.

Shares are on a six-session winning streak and have reached overbought territory with RSI above 70 again. This is typically where prior pullbacks have occurred and why we have Stop Limits set. However, shares can trade at overbought levels for periods of time so we can also enjoy higher highs.

AT&T (T, $17.55, up $0.37)

T April 17 calls (T240419C00017000, $0.65, up $0.25)

Entry Price: $0.65 (3/11/2024)
Exit Target: $1.30
Return: 0%
Stop Target: None

Action: Shares soared to a high of $17.59 with key resistance at $17.50 getting reclaimed. Support is at $17.25-$17 and the 50-day moving average.

Trades on Hold

Petróleo Brasileiro (PBR)
PBR April 18 calls (PBR240419C00018000)