MomentumOptions.com Pre-Market for 12/13/2017
Bulls Continue Record Run
8:00am (EST)
The bulls continued their flight towards fresh all-times highs but settled mixed ahead of Wednesday’s Fed decision on interest rates. The Dow and S&P 500 climbed 0.5% and 0.2%, respectively, with both indexes extending their winning streaks to four-straight.
The Nasdaq slipped 0.2% after failing near-term resistance to snap its four-session win streak. Meanwhile, the Russell 2000 traded showed strength in the first half of trading before weakening while closing lower by 0.2%.
Financials showed the most strength with the sector adding 1% followed by Real Estate and Health Care which rose 0.5% and 0.4%. Utilities lagged after sinking 1.4% while the Energy sector dropped 0.3%.
Fed funds futures remain priced for a 25 basis-point increase in rates this afternoon, and is about 60% of the way toward pricing in another tightening in March. The dot plot will likely show a tightening in Q1 and another during the year, and could even start to anticipate three increases.
The Spider S&P 500 ETF (SPY) traded to an all-time high of $267.32 with fresh resistance at $267-$267.50 getting split. We have talked about a run towards these levels on continued momentum with a move above the latter getting $270 in play. Rising support is at $266-$265.50. A move back below the latter would likely lead to a retest of $264-$262.
RSI is pushing late November resistance at 75 with continued closes above this level likely leading to a run towards 80 and October highs. A move back below 70 would be a slightly bearish development.
The Consumer Discretionary Select Spiders (XLY) closed higher for the 4th-straight session after making a run to $97.81. Near-term resistance at $98-$98.25 held with the all-time high at $98.37. Support is at $97-$96.75 with a move below the latter signaling another short-term top.
RSI has been holding support at 70 since mid-November with a close below this level being a bearish development. Continued strength could lead to another test towards 80.
I have updated our current trades so let’s go check the tape.
Momentum Options Play List
Closed Momentum Options Trades for 2017: 54-22 (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, $118.15, up $0.14)
GLD January 117 puts (GLD180117P00117000, $1.00, flat)
Entry Price: $0.95 (12/11/2017)
Exit Target: $1.90
Return: 5%
Stop Target: None
Action: Shares held support at $118-$117.75 following yesterday’s dip to $117.40. Resistance is at $118.50.
Intel (INTC, $43.33, down $0.33)
INTC January 45 calls (INTC180119C00045000, $0.50, down $0.05)
Entry Price: $0.53 (12/11/2017)
Exit Target: $1.10
Return: -6%
Stop Target: None
Action: Shares tested a low of $43.08 on Tuesday with fresh support at $43.25-$43 holding. Lowered resistance is at $43.50-$43.75.
Bank of America (BAC, $29.32, down $0.38)
BAC January 30 calls (BAC180119C00030000, $0.62, up $0.12)
Entry Price: $0.50 (12/8/2017)
Exit Target: $1.00
Return: 24%
Stop Target: None
Action: Upper resistance at $29.25-$29.50 was tested on yesterday’s run to a fresh 52-week peak. Support has moved up to $29-$28.75.
Viavi Systems (VIAV, $8.72, down $0.15)
VIAV January 9 calls (VIAV180119C00009000, $0.30, down $0.05)
Entry Price: $0.65 (11/29/2017)
Exit Target: $1.30
Return: -56%
Stop Target: None
Action: Upper support at $8.75-$8.50 was breached on Tuesday’s trip to $8.71. Resistance is at $9.
Twitter (TWTR, $21.65, down $0.40)
TWTR January 24 calls (TWTR180119C00024000, $0.35, down $0.10)
Entry Price: $0.70 (11/22/2017)
Exit Target: $1.40
Return: -50%
Stop Target: 15 cents (Stop Limit)
Action: Support is at $21.50-$21.25. Resistance is at $21.75-$22.
TiVo (TIVO, $15.90, down $0.25)
January 20 calls (TIVO180119C00020000, $0.10, down $0.05)
Entry Price: $0.60 (10/31/2017)
Exit Target: $1.20
Return: -84%
Stop Target: None
Action: Support is at $16-$15.75. Resistance is at $16.25.