Dear Momentum Options Subscriber,
The market is mixed heading into the second half of trading, but the bulls are looking good for the weekly win. Tech earnings have helped the Nasdaq push new highs today, with Google (GOOG) and Amazon.com (AMZN) leading the way higher. However, the lack of action in the small-caps is a little concerning.
The Dow is up 44 points to 18,103, while the S&P 500 is higher by 7 points to 2,120. The Nasdaq is gaining 42 points to 5,098, and the Russell 2000 is down 2 points to 1,269.
I have a number of trade updates below along with a New Trade, so let’s go check the action. I could have additional updates into the close, but, if you don’t hear from me, have a great weekend! I will be back on Monday morning with a full update.
Momentum Options Play List
Closed Momentum Options Trades for 2015: 40-11-1 (77%). All trades are dated and time stamped so new subscribers can look at the past history to see how the trades have played out.
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 9 a.m. and 12 p.m. – 1 p.m. updates. Also, I will usually give you a heads-up if I think I’m going to send an email outside of these time frames.
All prices given in this update are current as of 12:40 p.m. EST.
Every new Momentum Options recommendation is listed with the price at which I entered my own position. If the price is slightly different than my recommended entry or exit price when you receive the alert, don’t let that keep you from getting into or out of a trade. Occasionally, you might even get a better “fill” price than what is posted in the Open Trades and Closed Trades.
New Trade
TiVo (TIVO, $11.30, up $0.08)
Buy to open the TIVO June 12 calls (TIVO150619C00012000, $0.30, up $0.02) at current levels.
I like these call options at current levels. These are the regular monthly calls that expire on June 19. I will provide the parameters of the trade in Monday’s Pre-Market Update.
Current Trades
Rigel Pharmaceuticals (RIGL, $4.90, up $0.57)
RIGL June 5 calls (RIGL150619C00005000, $0.60, up $0.15)
Entry Price: $0.25 (3/31/2015)
Exit Target: $0.75-$1.00
Return: 140%
Stop Target: None
Action: Take profits and sell to close a quarter (1/4) of the RIGL June 5 calls at current levels.
Shares have traded to a high of $4.96 today. I would like to see $4.75 hold into the close.
Rambus (RMBS, $13.86, down $0.44)
RMBS August 14 calls (RMBS150821C00014000, $1.25, down $0.05)
Entry Price: $0.65 (4/20/2015)
Exit Target: $1.70 (closed first half at $1.30 on 4/21/15)
Return: 77%
Stop Target: $1.00 (Stop Limit)
Action: The $1.00 Stop Limit on the second half of the RMBS August 14 calls has triggered, and we are now out of the trade.
I will keep RMBS on my Watch List, but the move back below $14 was slightly bearish.
PowerShares QQQ Trust (QQQ, $110.62, up $1.56)
QQQ May 110 calls (QQQ150515C00110000, $1.70, up $0.80)
Entry Price: $0.60 (4/10/2015)
Exit Target: $1.20 (closed first half at $0.70 on 4/22/15)
Return: 100%
Stop Target: $0.70 (Stop Limit)
Action: Take profits and sell to close the second half of the QQQ May 110 calls at current levels.
With the weekend here and these being May options, I want to lock in our triple-digit profits. I will keep the QQQs on my Watch List for another possible trade, but I’m out for now.
SunPower (SPWR, $34.28, down $0.57)
SPWR June 38 calls (SPWR150619C00038000, $0.95, down $0.10)
Entry Price: $0.95 (4/22/2015)
Exit Target: $1.90
Return: 0%
Stop Target: None
Action: Near-term resistance is at $36. Support is at $34.
Earnings are due out on April 30, and you can read more about what to expect in yesterday’s Pre-Market Update.
Dot Hill Systems (HILL, $6.61, up $0.11)
HILL September 7.50 calls (HILL150918C00007500, $0.65, up $0.10)
Entry Price: $0.45 (4/20/2015)
Exit Target: $1.35-$1.80
Return: 44%
Stop Target: None
Action: Resistance is at $6.50-$6.75. Support is at $6.25-$6.
You can read my earnings outlook and review the stock’s chart in the April 21 Pre-Market Update.
Sony (SNE, $31.37, up $0.65)
SNE May 32 calls (SNE150515C00032000, $0.90, up $0.25)
Entry Price: $0.50 (4/20/2015)
Exit Target: $1.50-$2 (closed 1/3 at $1.40 on 4/22/15)
Return: 113%
Stop Target: None
Action: Resistance is at $31-$31.50. Support is at $30-$29.75. Earnings are due out next Thursday, April 30.
Jabil Circuit (JBL, $23.73, down $0.20)
JBL May 24 calls (JBL150515C00024000, $0.40, down $0.10)
Entry Price: $0.60 (4/10/2015)
Exit Target: $1.20
Return: -33%
Stop Target: None
Action: Resistance is at $23.50-$24. Support is at $23.
Trades on Hold — other 2015 Portfolio Open positions (3): These are trades that are still open in the portfolio but are down over 50%. They have longer expiration dates and are on “hold” but are not worth mentioning until they turn around. This means I would not open any new positions. I’m still keeping track of the trades and will record the results accordingly when the trade closes or if the options expire. Click on the Open Trades and Closed Trades pages to see all open and closed positions.
Marvell Technology (MRVL) May 18 calls (from February 2015) — The sector could see heated M&A activity in the coming months, and MRVL tends to move on takeover chatter — Continue to hold.
BlackBerry (BBRY) June 13 calls (from March 2015) — This is a speculation trade from early March on BBRY receiving a takeover offer of $14 or better by mid-June — Continue to hold.
Cypress Semiconductor (CY) June 16 calls (from March 2015) — Earnings are due out next Thursday, April 30 — Continue to hold.
Trade on!
Rick Rouse
Editor and Chief Options Strategist
Momentum Options