MomentumOptions.com Mid-Market for 2/21/2018
FOMC Minutes Reveal Dovish Fed
3:25pm (EST)
Minutes from the last Federal Reserve showed U.S. economic projections were stronger than forecast at the time of their December meeting. Real GDP from 4Q of last year was also ahead of expectations, as gains in both household and business spending were larger than anticipated.
Beyond 2017, the forecast for real GDP growth was revised up, reflecting a reassessment of the recently enacted tax cuts, along with higher projected paths for equity prices and foreign economic growth and a lower assumed path for the foreign exchange value of the dollar.
The Fed said real GDP was projected to increase at a somewhat faster pace than potential output through 2020. The believe that the recently enacted tax cuts would boost real GDP growth moderately over the medium term.
As far as the unemployment rate, the Fed projected a further decline over the next few years as it continues to run well below their estimate of the longer-run natural rate over this period.
To make a long story short, the dovish comments from the Fed were encouraging and has given the market continued momentum. However, the indexes are fading fast as I go to press.
Heading into the closing bell, the Dow is gaining 12 points to 24,976 while the S&P 500 is up 5 points to 2,721. The Nasdaq is higher by 33 points to 7,267 and the Russell 2000 is advancing 17 points to 1,547.
Momentum Options Play List
Closed Momentum Options Trades for 2018: 7-5 (58%). 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.
Bank of America (BAC, $32.12, up $0.19)
BAC March 33 calls (BAC180316C00033000, $0.33, up $0.05)
Entry Price: $0.50 (2/15/2018)
Exit Target: $1.00
Return: -34%
Stop Target: None
Action: Resistance is at $32-$32.25. Support at $31.75-$31.50.
Intel (INTC, $46.33, up $0.01)
INTC April 46 calls (INTC180420C00046000, $2.20, flat)
Entry Price: $1.28 (2/14/2018)
Exit Target: $2.60
Return: 91%
Stop Target: $1.90 (Stop Limit)
Action: Resistance is at $46.50-$46.75. Support is at $46-$45.75.
Viavi Systems (VIAV, $9.89, up $0.03)
VIAV March 10 calls (VIAV180316C00010000, $0.25, flat)
Entry Price: $0.45 (2/6/2018)
Exit Target: $0.90
Return: -44%
Stop Target: None
Action: Resistance is at $10. Support is at $9.75-$9.50.