MomentumOptions.com Pre-Market for 2/13/2018
Bulls Show Continued Strength
8:00am (EST)
The market showed strength for a 2nd-straight session following its worst two-week performance in more than two years. The indexes traded higher throughout the session following some early morning volatility but closed near session highs while pushing short-term resistance levels.
The Dow rallied 1.7% after testing a high of 24,765 and temporarily regaining positive territory for the year. The S&P 500 soared 1.4% after tapping an intraday high of 2,672 and coming within a point of returning to positive territory for 2018.
The Nasdaq jumped 1.6% after trading to an intraday high of 7,023 while closing just below the 7,000 level. The index is back in positive for the year after closing above 6,903.
The Russell 2000 was slightly weak on the open after testing a low of 1,466 before regaining its footing to push 1,500. The index gained 0.9% but needs to clear 1,535 to get back into positive territory for the year.
Materials led sector strength after rising 2% followed by Technology and Energy which added 1.7% and 1.6%, respectively. Real Estate was up 0.3% and was the sector laggard.
The VelocityShares Daily Inverse VIX (ZIV) traded up to 69.34 on the open while holding positive territory throughout the session. Resistance at 67.50 was cleared with fresh hurdles at 69.50-70. Shaky support has move up to 65-64.50.
The Spider Small-Cap 600 ETF (SLY) closed higher for the second-straight session after trading to a high of $130.24. Continued closes above resistance at $130.25-$130.50 would be a slightly bullish development. Support is at $128-$127.50 with the close below the latter signaling another backtest towards $126-$125.50 and the 200-day moving average.
RSI is back in an uptrend with short-term resistance at 40. Continued closes above this level would be bullish for a run towards 50.
The Industrials Select Sector Spider (XLI) tested a high of $75.54 with resistance at $75.50-$76 holding. Continued closes above the latter could lead to a push towards $76.50-$77 and the 50-day moving average. Near-term support is at $74-$73.75 with a close below the latter being a slightly bearish development.
RSI cleared short-term resistance at 40 with continued closes above this level leading to a test towards 50. Support is at 30.
Yesterday’s action was a slightly bullish signal but I would like to see continued follow through today. The higher Friday/ Monday closes showed money is moving back into the market and I’ve mentioned past sharp pullbacks have been bought. If the market gain hold opening gains an hour into trading, I could have new trades.
Momentum Options Play List
Closed Momentum Options Trades for 2018: 5-5 (50%). 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.
Viavi Systems (VIAV, $9.72, up $0.02)
VIAV March 10 calls (VIAV180316C00010000, $0.30, down $0.05)
Entry Price: $0.45 (2/6/2018)
Exit Target: $0.90
Return: -33%
Stop Target: None
Action: Resistance at $9.75-$10 held on yesterday’s rise to $9.76. Support remains at $9.50.
Marvell Technology (MRVL, $21.92, up $0.62)
MRVL May 24 calls (MRVL180518C00024000, $0.85, up $0.10)
Entry Price: $0.83 (2/6/2018)
Exit Target: $1.70
Return: 2%
Stop Target: None
Action: Fresh resistance is at $22-$22.25 following yesterday’s run to $22.04. Rising support is at $21.75-$21.50.
