MomentumOptions.com Pre-Market for 12/21/2017
Bears Hold Resistance
8:00am (EST)
The market settled mostly lower on Wednesday despite the House passing the Republican-backed tax bill with the legislation marking the President’s first major legislative victory. The official signing remains uncertain but will take effect at the start of 2018.
The Russell 2000 traded in positive territory for much of the session after adding 0.3% while closing higher for the third time in four sessions. The Dow and S&P 500 slipped 0.1% after falling just shy of new all-time highs on the open. Meanwhile, the Nasdaq gave back 3 points, or 0.04% after failing the 7,000 level for the second-straight session.
Energy shined with the sector rising 1.4% while Industrials and Materials added 0.4% and 0.03%, respectively. Real Estate led the laggards after dropping 1.1% while Utilities sank 0.8%.
The VelocityShares Daily Inverse VIX (ZIV) continued its parabolic run after trading to another record high of 87.18 while extending its win streak to 10-straight sessions. Resistance at 87-87.50 was split but held into the closing bell. Support is at 85.50-85 with a move below 84 signaling a short-term market top.
The Spider S&P 500 ETF (SPY) traded to a high of $268.33 with fresh resistance at $268.50-$269 holding. We have talked about a run towards $270 coming on continued strength and this week’s all-time high has tapped $268.60. Rising support is at $266.50-$266 with a move back below $265 likely signaling a short-term top with risk to $264-$262.50.
RSI failed late November and recent resistance at 75 with a close back below 70 being a slightly bearish development.
The Technology Select Sector Spiders (XLK) traded to a high of $65.01 on the open with fresh resistance at $65-$65.25 holding. Monday’s all-time peak reached $65.20 with fluff up to $66.50-$67 on a close above this level. Support is at $64.25-$64 with risk to $63-$62.75 and the 50-day average on a close below the latter. RSI recently held mid to late-November resistance at 70 and is currently trying to hold support near the 60 level.
I have once again updated our INTC trade with shares still showing strong momentum. It has quickly become the biggest trade of the year at 461% and why I wanted to lock-in partial,profits yesterday.
Momentum Options Play List
Closed Momentum Options Trades for 2017: 55-23 (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.
Spider Gold Shares (GLD, $120.14, up $0.32)
GLD January 117 puts (GLD180117P00117000, $0.30, down $0.05)
Entry Price: $0.95 (12/11/2017)
Exit Target: $1.90
Return: -68%
Stop Target: None
Action: Lower resistance at $120-$120.25 was cleared with a move above $120.50 and the 200-day moving average signaling a possible exit for the trade. Rising support is at $119.75-$119.50.
Intel (INTC, $47.56, up $0.52)
INTC January 45 calls (INTC180119C00045000, $2.95, up $0.35)
Entry Price: $0.53 (12/11/2017)
Exit Target: $3.25, raise to $4 (closed 1/3 @ $2.85 on 12/20/2017)
Return: 461%
Stop Target: $2.10/ $1.60, raise to $2.60/ $2.00 (Stop Limits on remaining 2/3rd’s)
Action: Raise the Exit Target to $4 as yesterday’s high reached $3.30. Raise the Stop Limits from $2.10/ $1.60 to $2.60/ $2.00 on the remaining position with one/third on each.
Upper resistance at $47.25-$47.50 was cleared on the fresh record high push to $47.64 yesterday. This sets up a run to $48-$50. Rising support is at $47.25-$47.
Bank of America (BAC, $29.48, up $0.03)
BAC January 30 calls (BAC180119C00030000, $0.55, flat)
Entry Price: $0.50 (12/8/2017)
Exit Target: $1.00
Return: 10%
Stop Target: None
Action: Fresh resistance is at $29.75-$30 following Wednesday’s 52-week high of $29.84. Support remains at $29.25-$29.
Viavi Systems (VIAV, $8.86, up $0.04)
VIAV January 9 calls (VIAV180119C00009000, $0.30, flat)
Entry Price: $0.65 (11/29/2017)
Exit Target: $1.30
Return: -54%
Stop Target: None
Action: Resistance is at $9. Support is at $8.75-$8.50.
Twitter (TWTR, $25.20, up $0.12)
TWTR January 24 calls (TWTR180119C00024000, $1.80, flat)
Entry Price: $0.70 (11/22/2017)
Exit Target: $2.50 (closed half @ $1 on 12/18/2017)
Return: 100%
Stop Target: $1.20 (Stop Limit)
Action: Lower resistance at $25.50-$25.75 held with yesterday’s high tapping $25.44. Support is at $24.75-$24.50.