MomentumOptions.com Pre-Market Update for 5/29/2025
Nvidia (NVDA) Tops Estimates
* It was crucial the current uptrend channels held to start the week with volatility easing, or at least holding key resistance. While there was a little wiggle room for some stretch, Tuesday’s 2% market rebound remained an ongoing bullish signal as key resistance levels were cleared, or challenged.
* Wednesday’s slight pullback kept the blue-chips below the 200-day moving average. The S&P and the Nasdaq cleared their 200-day moving averages on the May 12th breakout. The small-caps remain trapped between the 50-day and 200-day moving averages but could catch fire if the mid-month high is cleared.
* Dow component, Nvidia (NVDA), announced earnings after Wednesday’s close that topped Wall Street’s forecasts. The company posted an adjusted profit of $0.96 a share versus expectations of $0.93 a share. Revenue of $44 billion also cleared estimates for a print of $43.3 billion.
The stock market rebounded on Tuesday following a three-day holiday weekend to keep the current uptrend channels intact. Wednesday’s slight pullback came ahead of Nvidia’s earnings as traders were hesitant to put fresh money to work.
The Nasdaq closed at 19,100 (-0.5%) after testing a low of 19,084. Key support at 19,000 held. Resistance is at 19,250.
The S&P 500 reached a peak of 5,939 before settling lower at 5,888 (-0.6%). Support at 5,800 held. Resistance is at 5,950.
The Dow finished at 42,098 (-0.6%) with the intraday low at 42,042. Support at 42,000 held. Resistance is at 42,250.
Earnings and Economic News
Before the open: Best Buy (BBY), Burlington Stores (BURL), Foot Locker (FL), Kohl’s (KSS)
After the close: American Eagle Outfitters (AEO), Dell Technologies (DELL), Marvell Technology Group (MRVL), Zscaler (ZS)
Economic news:
Initial Jobless Claims – 8:30am
GDP – 8:30am
Pending Home Sales – 10:00am
Technical Outlook and Market Thoughts
It was crucial the current uptrend channels held to start the week with volatility easing, or at least holding key resistance. While there was a little wiggle room for some stretch, Tuesday’s 2% market rebound remained an ongoing bullish signal as key resistance levels were cleared, or challenged.
Wednesday’s slight pullback kept the blue-chips below the 200-day moving average. The S&P and the Nasdaq cleared their 200-day moving averages on the May 12th breakout. The small-caps remain trapped between the 50-day and 200-day moving averages but could catch fire if the mid-month high is cleared.
The Nasdaq remains in a 12-session trading range between 18,500-19,250 following the May 12th breakout. Wednesday’s multi-month peak reached 19,276 with closes above 19,250 confirming a possible push towards 19,750-20,000.
A close below 18,500 and the 200-day moving average would be a slightly bearish development with additional weakness to 18,250-18,000.
The S&P 500 is also in a 12-session trading range between 5,800-5,975 with Wednesday’s top at 5,939. Multiple closes above 5,975 and the monthly peak at 5,968 would indicate ongoing strength to 6,000-6,100.
Key support is now at 5,850. There is stretch down to 5,800 and the 200-day moving average on a close below this level.
The Russell 2000 traded up to 2,114 on May 16th with Wednesday’s peak at 2,092. The March 24th and 25th hit a double top high at 2,110 with more crucial resistance at 2,135. This level failed to hold as crucial support on the March 1st 3% selloff in the index. If all of the aforementioned levels are cleared and held, there is potential for a resumed and quick v-shape recovery up to 2,175-2,200 and the 200-day moving average.
Key support is at 2,050. A drop back below this level would suggest a retest to 2,000 and the 50-day moving average.
The Dow cleared its 200-day moving average on Wednesday but a level that has held both days this week. Multiple closes above 42,250 gets 42,750-43,000 back in play with the prior Monday’s peak at 42,842.
Key support is at 42,000 with backup help at 41,750-41,500. A close below 41,000 and the 50-day moving average would imply a near-term top for the blue-chips.
The Volatility Index (VIX) fell 15% on Tuesday and closed back below key support at 20. The more important target remains at 17.50 with multiple closes below this level confirming a run to all-time highs for the major indexes. There was one close below 17.50 on May 16th after this level was tested seven-straight sessions earlier this month.
Any move, or close, on the VIX above resistance at 24, or 26 and the 50-day moving average, should be taken seriously, as it would be a bearish development for the market.
Dow component, Nvidia (NVDA), announced earnings after Wednesday’s close that topped Wall Street’s forecasts. The company posted an adjusted profit of $0.96 a share versus expectations of $0.93 a share. Revenue of $44 billion also cleared estimates for a print of $43.3 billion.
Shares were up 5% in after-hours action and above $141. This should lead to a positive open for Thursday, providing the gains hold. We have been busy this week as we wanted to take advantage of the possible breakout to higher highs. We could still have Alert updates, and possible New Alerts, the rest of the week so stay locked-and-loaded.
Momentum Options Alerts Update for 5/29/2025
Closed Momentum Options Trades for 2025: 23-6 (79%) / 2024: 77-17 (82%, 38 triple-digit winners). Please remember, all “Exit Targets” and “Stop Targets” are targets. You should not have any “Stops” entered to close any alerts or “Limit Orders” in your brokerage account unless we list one. We will send out an “Alert” or “New Alert” if we want you to close a position or if a new position comes out. Otherwise, follow instructions at all times in the updates on Monday’s and Thursday’s along with Text Alerts and videos throughout the week.
Direxion Daily TSLA Bull 2X Shares (TSLL, $15.91, down $0.55)
TSLL June 21 calls (TSLL250620C00021000, $0.75, down $0.15)
Entry Price: $0.75 (5/27/2025)
Exit Target: $1.50
Return: 0%
Stop Target: None
Action: Shares traded to a low of $15.83 with fresh support at $16 and the 200-day moving average getting stretched and failing to hold. A drop below $15 could suggest a quick retest to $14.
With shares of Tesla breaking out to higher highs, we wanted to add TSLL as a way to play the action. This is a leveraged exchanged-traded fund (ETF) designed to move 200% of the daily performance of Tesla stock. In other words, if TSLA is up or down 1%, TSLL will move 2%, or again, twice the action that TSLA does.
The ETF was created in August 2022 and has assets under management of just over $6 billion. The current dividend yield is just under 4% and paid quarterly. This also makes TSLL a great covered call candidate as you can sell call options to get additional income on a monthly basis.
We noted on the chart that shares made a move from $11.20 on November 4th to $25.15 by December 5th of last year and why we have a current $25 Price Target. If reached by June 20th, these calls will be at least $4 in-the-money. We would like to close half the Alert on a pop above $20 and then let the rest ride to higher highs.
There has also been some unusual options activity recently in TSLL. On May 21st, the stock closed at $14.08 with the TSLL July 25 calls at 70 cents. Volume for the session hit 5,185 contracts versus open interest of 31 contracts beforehand.
Bank of America (BAC, $44.06, down $0.16)
BAC July 48 calls (BAC250718C00048000, $0.45, down $0.05)
Entry Price: $0.42 (5/27/2025)
Exit Target: $0.85
Return: 7%
Stop Target: None
Action: Yesterday’s high hit $44.44 with key resistance at $45 holding. Continued closes above this level should get $46-$47 in play with the double-top peak just below $48 from February 6th and 7th. Support is at $43.50-$43. A close below $42.50 and the 200-day moving average would be a bearish development.
Teva Pharmaceuticals (TEVA, $18.15, up $0.44)
TEVA July 18 calls (TEVA250718C00018000, $1.20, up $0.15)
Entry Price: $0.50 (5/22/2025)
Exit Target: $2.00 (closed half at $1.10 on 5/27)
Return: 130%
Stop Target: 70 cents, raise to 90 cents (Stop Limit)
Action: The company announced a collaboration with Biolojic Design to treat inflammatory diseases on Tuesday with shares jumping 5%. We took advantage of the news to lock-in half profits in case their was a pullback. We also raised the Stop Limit to 70 cents to further protect profits. Let’s move the Stop Limit up to 90 cents to ensure a triple-digit return as the average closing price would be at $1.
Shares closed on the session high of $18.15 with lower resistance at $18-$18.25 getting cleared and holding. Closes above the latter would imply ongoing upside to $18.75-$19. Support is at $17.75-$17.50.
Rocket Companies (RKT, $12.87, down $0.22)
RKT July 15 calls (RKT250718C00015000, $0.45, down $0.05)
Entry Price: $0.50 (5/20/2025)
Exit Target: $1.00
Return: -10%
Stop Target: None
Action: Wednesday’s high tagged $13.15 with lower resistance at $13-$13.25 getting cleared but holding. Continued closes above the latter and the 50-day moving average would be a bullish signal for strength to $14.75-$15 and the 200-day moving average. Support is at $12.50-$12.25.
Our Price Target for RKT is $18 by mid-July. This level served as key support last October 17th and 18th. If reached, these calls will be at least $3 in-the-money. This would represent a 500% return from the profiled price of 50 cents.
Petrobras (PBR, $11.73, down $0.19)
PBR July 13 calls (PBR250718C00013000, $0.10, unchanged)
Entry Price: $0.25 (5/13/2025)
Exit Target: $0.50
Return: -60%
Stop Target: None
Action: Upper support at $11.75-$11.50 was tripped and failed to hold on the pullback to $11.70. Resistance is at $12-$12.25 with more important hurdles at $12.50 and the 50-day moving average.
Mobileye Global (MBLY, $16.82, up $0.58)
MBLY June 19 calls (MBLY250620C00019000, $0.40, up $0.15)
Entry Price: $0.50 (5/13/2025)
Exit Target: $1.00
Return: -20%
Stop Target: None
Action: Shares reached a peak of $17.52 with the options peaking at 56 cents. Key resistance at $17.25 was cleared and held. New support is at $16.50-$16.25.
This Alert has made a sweet comeback and we are still hoping to make a triple-digit return. However, these are June options and they expire in just over three weeks. If shares can breakout to fresh highs this week, we may close half the Alert ahead of the weekend.
Sony Group (SONY, $26.30, down $0.26)
SONY June 27 calls (SONY250620C00027000, $0.65, down $0.10)
Entry Price: $0.70 (4/29/2025)
Exit Target: $1.40
Return: -7%
Stop Target: None
Action: Tuesday’s fresh 52-week high touched $26.60 with January 2022 resistance at $26.50-$26.75 getting recovered. A close above the latter would indicate strength to $27.50-$28.
Support is at $26-$25.75. We will likely exit the Alert to save the remaining premium if $25.50 and the current uptrend channel fail to hold going forward.