NextOptions.com Index and Earnings Options Play List for 3/26/2019
Mixed Monday on Lower Lows
The market was choppy throughout Monday’s action after trading on both sides of the ledger before settling mixed. The yield curve inversion remained a concern as the opening lows continued to push early March, and February support levels for the small-caps, before a rebound shortly afterwards.
News that the Mueller investigation didn’t overtly link President Trump to any Russian collusion failed to inspire much bullish sentiment. Meanwhile, volatility stayed slighted elevated but held key resistance for a 2nd-straight session.
The Russell 2000 gained 0.5% despite the opening pullback to 1,494. Lower support at 1,500-1,490 held on the close above the former with a move back above 1,525 and the 50-day moving average signaling a near-term bottom.
The Dow edged up 0.1% after testing a low of 25,372 shortly after the opening bell. Fresh and upper support at 25,400-25,150 and the 50/200-day moving averages held with the a close below the monthly low of 25,208 signaling additional weakness.
The Nasdaq slipped 0.1% after trading to a morning low of 7,579. Fresh support at 7,600-7,550 was split with a close below the latter being a bearish signal with additional weakness towards 7,500-7,450 and the 200-day moving average.
The S&P 500 also dipped 0.1% following the first half pullback to 2,785. Major and upper support at 2,800-2,775 failed to hold on the close below this level for the first time in 9 sessions.
Consumer Discretionary led sector strength after advancing 0.6% while Consumer Staples and Industrials were higher by 0.2%.
Technology and Financials paced sector laggards after falling 0.4%. Communication Services and Materials were down 0.2%.
The S&P 500 Volatility Index ($VIX) tested an intraday high of 17.85 with resistance at 17.50-18 holding for the 2nd-straight session. A move above the latter and the monthly peak of 18.33 would be a bearish signal with risk towards 19.50-20.
Shaky support remains at 16-15.50 and the 50-day moving average following the 2nd-straight close below the 200-day moving average.
The Spider S&P 500 ETF (SPY) closed in the red for the 2nd-straight session following the backtest to $277.64. Current support at $277.50-$277 held with a move below the latter opening up risk towards $275.50-$275.
The 50-day moving average is 6 cents away from clearing the 200-day moving average to form a golden cross. This is typically a bullish signal for higher highs.
Near-term resistance is at $279.50-$280 with a move above the latter getting $282.50-$283 back in play.
RSI is trying to level out with support at 50 and the monthly low. A move below this level would be a bearish signal with additional weakness towards 45-40 with the latter representing the January bottom.
The Utilities Select Spider (XLU) rose for the 4th-straight session after trading to an intraday high of $58.72. Prior and multi-year resistance at $58.75-$59 held with a move above the latter signaling additional strength towards $60-$60.50. Friday’s 52-week peak reached $58.90.
Near-term support is at $58.25-$58. A move below the latter would signal a possible near-term top with additional risk towards $57.50-$57 and mid-month support levels.
RSI is in an uptrend with resistance at 75. Continued closes above this level would get 80 back in the mix but signaling oversold levels from earlier this month and July 2018. Support is at 70 with risk towards 65-60 on a move below this level.
Cesca Therapeutics (KOOL), Red Hat (RHT), Yield10 Bioscience (YTEN) announced earning after Monday’s close.
Carnival (CCL), Conn’s (CONN), Cronos Group (CRON), FactSet Research Systems (FDS), IHS Markit (INFO), McCormick & Company (MKC), Neogen (NEOG), Onconova Therapeutics (ONTX), Orion Group Holdings (ORN), TuanChe (TC) are reporting numbers this morning.
Our top triple-digit winning option recommendations for 2019:
+177% Advanced Micro Devices AMD February 23 calls (February 2019)
+155% Twitter TWTR January 31 calls (January 2019)
+40% BlackBerry BB March 7.50 calls (February 2019)
Our top triple-digit winning option recommendations for 2018:
+414% Boston Scientific BSX September 36 calls (September 2018)
+400% Spider Dow Jones February 250 puts (February 2018)
+400% PowerShares QQQ February 162 puts (February 2018)
+300% Intel February 47 calls (January 2018)
+225% CVS June 65 calls (May 2018)
+209% Boston Scientific BSX July 31 calls (June 2018)
+208% Garmin GRMN January 62.50 puts (December 2018)
+191% Sony February 48 calls (January 2018)
+175% Big Lots June 40 puts (June 2018)
+168% American Airlines July 40 puts (June 2018)
+165% Okta September 65 calls (September 2018)
+133% Progenics Pharmaceuticals May 8 calls (March 2018)
+117% Energous May 17.50 calls (April 2018)
+100% CVS January 75 calls (November 2018)
+100% PowerShares QQQ November 167.50 puts (October 2018)
+100% Papa John’s International August 40 puts (August 2018)
+100% Progenics Pharmaceuticals August 8 calls (June 2018)
+100% Spider Dow Jones February 258 puts (January 2018)
+100% Marvell Technology (March 2018)
+100% Viavi Systems September 11 calls (August 2018)
Viavi Solutions (VIAV, $12.14, up $0.02)
VIAV June 13 calls (VIAV190621C00013000, $0.50, flat)
Entry Price: $0.65 (3/12/2019)
Exit Target: $1.30
Stop Target: None
Action: Shares tapped a low of $11.99 with lower support at $12.10-$12 getting breached but holding. Resistance remains at $12.20-$12.30. Earnings are due out the first week of May.
AT&T (T, $30.77, down $0.30)
T April 31 calls (T190418C00031000, $0.40, down $0.10)
Entry Price: $0.65 (3/1/2019)
Exit Target: $1.30
Stop Target: None
Action: Upper support at $30.75-$30.50 and the 200/ 50-day moving averages held on the fade to $30.65 on Monday. Lowered resistance is at $31-$31.25. Earnings are due out on April 24th.
Bank of America (BAC, $26.84, down $0.17)
BAC April 30 calls (BAC190418C00030000, $0.15, down $0.05)
Entry Price: $0.75 (2/21/2019)
Exit Target: $1.50
Stop Target: None
Action: Shares traded down to $26.61 with upper support at $26.75-$26.50 holding. Lowered resistance is at $27-$27.25.
Earnings are due out on April 16th.
After the close: AEterna Zentaris (AEZS), Fat Brands (FAT), Inpixon (INPX), KB Home (KBH), Ollie’s Bargain Outlet (OLLI), Polar Power (POLA), Roxgold (ROGFF), Shoe Carnival (SCVL), TransAtlantic Petroleum (TAT)
Before the open: At Home Group (HOME), Charah Solutions (CHRA), Eyenovia (EYEN), Leatt (LEAT), Lennar (LEN), Omnova Solutions (OMN), Paychex (PAYX), SecureWorks (SCWX), Titan Machinery (TITN), UniFirst (UNF), Weidai (WEI)