Dear Momentum Options Subscriber,
FedEx (FDX, $178.05, up $0.73) will be announcing its numbers ahead of Wednesday’s open. It is one of the pieces of this week’s market puzzle that I’ve been anxious to hear, as its results will likely influence the Dow Jones Transportation Average ($TRAN, 9,088, down 8).
Wall Street is looking for FedEx to earn $1.87 a share on revenue of $11.8 billion. The high estimates have the company earning $1.99 a share on $12.08 billion in sales. The low estimates are calling for $1.71 a share on revenue of $11.58 billion.
A headline of a 12-cent beat or a 16-cent miss would be significant.
FedEx shares are pushing 52-week peaks, and a close above $183.51 would be a fresh high. This would require a 5% move, which is likely given the news. A disappointing quarter could have shares testing $170.
Monday’s market rally helped the Dow Transports regain its 50- and 100-day moving averages, which was a slightly bullish sign despite the death cross that has officially formed on the chart.
While I’m still looking for higher highs for the market, this situation bears watching. Pun intended.
Heading into the second half of trading, the Dow is down 125 points to 17,851, while the S&P 500 is lower by 8 points to 2,072. The Nasdaq is slipping 3 points to 4,925, and the Russell 2000 is off 3 points to 1,236.
I’m still researching a New Trade to find the best potential return on a possible option play, so stay tuned. In the meantime, let’s go check the tape.
Momentum Options Play List
Closed Momentum Options Trades for 2015: 22-6-1 (76%). All trades are dated and time stamped so new subscribers can look at the past history to see how the trades have played out.
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 9 a.m. and 12 p.m. – 1 p.m. updates. Also, I will usually give you a heads-up if I think I’m going to send an email outside of these time frames.
All prices given in this update are current as of 1:05 p.m. EST.
Every new Momentum Options recommendation is listed with the price at which I entered my own position. If the price is slightly different than my recommended entry or exit price when you receive the alert, don’t let that keep you from getting into or out of a trade. Occasionally, you might even get a better “fill” price than what is posted in the Open Trades and Closed Trades.
NVIDIA (NVDA, $22.97, flat)
NVDA April 23 calls (NVDA150417C00023000, $0.69, flat)
Entry Price: $0.65 (3/16/2015)
Exit Target: $1.30
Return: 6%
Stop Target: None
NVDA May 24 calls (NVDA150515C00024000, $0.64, flat)
Entry Price: $0.65 (3/16/2015)
Exit Target: $1.30
Return: -2%
Stop Target: None
Action: Shares recently made a strong breakout out of a four-month trading range of $19-$21. Near-term support is at $22. Resistance is at $23 and the 52-week high of $23.42. A close above the latter should lead to a run to $25-$26.
Yahoo! (YHOO, $43.87, up $0.36)
YHOO April 47 calls (YHOO150417C00047000, $0.50, up $0.02)
Entry Price: $0.80 (2/26/2015)
Exit Target: $1.60
Return: -38%
Stop Target: None
Action: Resistance is at $44. Near-term support is at $43.
Western Union (WU, $19.58, down $0.03)
WU April 20 calls (WU150417C00020000, $0.40, flat)
Entry Price: $0.36 (2/25/2015)
Exit Target: $0.75
Return: 11%
Stop Target: None
Action: Resistance is at $19.75-$20. Support is at $19.50-$19.25.
American Express (AXP, $80.76, down $0.74)
AXP April 87.50 calls (AXP150417C00087500, $0.24, down $0.05)
Entry Price: $0.56 (2/25/2015)
Exit Target: $1.15
Return: -57%
Stop Target: None
Action: Resistance is at $83-$84 and the 50-day moving average. Support is at $80.
Flextronics (FLEX, $11.88, down $0.02)
FLEX April 12 calls (FLEX150417C00012000, $0.30, flat)
Entry Price: $0.67 (2/24/2015)
Exit Target: $1.35
Return: -55%
Stop Target: None
Action: Resistance is at $12, and a close above this level would be bullish. Support is at $11.75-$11.50 and the 50-day moving average.
Marvell Technology (MRVL, $15.72, down $0.27)
MRVL May 18 calls (MRVL150515C00018000, $0.30, down $0.05)
Entry Price: $0.50 (2/18/2015)
Exit Target: $1.00
Return: -40%
Stop Target: None
Action: Support is at $15.75 and the 50-day moving average. Resistance is at $16.25.
BlackBerry (BBRY, $9.68, down $0.04)
BBRY June 13 calls (BBRY150617C00013000, $0.24, down $0.03)
Entry Price: $0.60 (3/2/2015)
Exit Target: $1.20+
Return: -60%
Stop Target: None
Action: Resistance is at $10 and the 200-day moving average. Support is at $9.75-$9.50. This is a speculation play that BBRY will get a takeover offer by mid-June.
Trade on!
Rick Rouse
Editor and Chief Options Strategist
Momentum Options