MomentumOptionsTrading.com Morning Update for 6/24/2014
Bears Get Monday Win/ Profit Alert (RMBS)!!!
The bears got a rare Monday win as the Dow finished lower for the first time in the past 10 but the bulls made some noise as Tech pushed green throughout the session.
The Dow fell nearly 10 points, or 0.1%, to close at 16,937. The blue-chips traded to a low of 16,896 after kissing 16,954 on the open (up 7 points) before spending the rest of the session below water. The cheerleading talking heads may have jinxed a trip past 17,000 but as long as support holds at 16,900-16,800 there is a good chance it happens.
The S&P 500 slipped a quarter-point, or 0.01%, to settle at 1,962. The index gained nearly a point at the open and touched 1,963.74 but fell short of Friday’s high of 1,963.91. Support at 1,960-1,950 held before the bulls nearly made it back to even into the close. A move above 1,965 keeps 1,975-2,000 alive.
The Nasdaq added a half-point, or 0.01%, to end at 4,368.68. Tech touched another 52-week high of 4,371.81 before fading to 4,358 midday. Support at 4,350 held and the bulls pushed positive territory throughout the session. There is still risk to 4,325-4,300 on a dip below this level while 4,400-4,500 remains in play on a pop past 4,375.
The Russell 2000 gave back 3.5 points, or 0.3% to finish a shade under 1,185. The small-caps kissed 1,190 before fading to 1,183 late in the day. A move above this level keeps 1,200 in play while a close below 1,175-1,170 would be bearish.
The S&P 500 Volatility Index ($VIX, 10.98, up 0.13) held 11.50 after testing 11.35 during the first half of trading but drifted lower into the closing bell. A drop below 10.50 and Friday’s low of 10.34 should lead to single-digits.
There were a number of trades that were stopped out yesterday but the good news is they were profitable as I had already lock-in half profits in some of them.
I have been on a roll since early May, knock on wood, as I have gone 14-3, over the past 17 trades. This is an 82% win rate, including the past 9 in-a-row.
These types of rolls help when there is a clear trend (which there has been since late May) as they help offset trades that go against you when trading ranges develop or your on the wrong side of the market during a breakout or breakdown.
I am fortunate enough the market has given GREAT clues since the late May breakout that higher highs were in store once the trading range was resolved.
The December fluff targets for the major indexes I had given in December have all but triggered and I called for the breakout through mid-June. It lasted an extra week and I am hopeful it can last through but I often say calling short-term tops and bottoms are incredibly hard.
Although, I recommended a New Trade yesterday, I still want to be careful before opening the next batch of New Trades. I mentioned a trading range could develop into early July and from there 2Q earnings take center stage.
This will be the next major catalyst that moves the market to continued fresh highs or a drop to prior support levels. The are numerous drama developing overseas and I have said the market can go up during threats of war. However, if bullets start to fly and air strikes increase, hold on as things will likely get ugly.
Futures look like this ahead of the open: Dow (-12); S&P 500 (-2); Nasdaq 100 (-3).