Stocks Move Higher as Momentum Increases. Take Combined $1560 Profit on RJF and XHB Call Option.

Let's see how long the upside momentum lasts.

Due to the holiday, this is a combined Momentum Monday and ESP Tuesday post.

I am recommending taking profits on two trades this morning with a combined haul of $1560. That brings our recent combined Momentum/ESP portfolio profit to $2323 over the last couple of weeks. I am also adding two new Momentum picks.

Happy trader image courtesy of cloudfront.com

Here are the latest trade results:

• SOLD Raymond James Financial (RJF). Bought 1/8/25: $157.50. SOLD 1/21/25 intraday price: $170.50. Return for this trade: $1300/100 shares (8.1%).

• Closed - Sell to Close the February 21, 2025 SPDR Homebuilder ETF (XHB) $110 Call option. Bought 12/31/2024: $2.06. 1/21/25 intraday price: Bid/Ask: $4.60/$4.75. Return for this trade: $260/contract (125%).

• SOLD Bristol Myers Squibb (BMY). Bought 9/20/24: $49. SOLD 1/14/25. Sell Stop: $56. Return for this trade: $700/100 shares (14.3%).

• CLOSED - February 21, 2025 Kratos Defense & Security Solutions (KTOS) $30 Call option. Bought 12/31/24: $0.82. Closed 1/07/25 intraday price: $1.45. Return for this trade: $63/100 shares (43.4%).

With Raymond James Financial (RJF) nearing the resistance level near $170, this is a great time to take profits.

The same logic applies to the XHB option as the ETF tests its 50-day moving average.

Market Update

The New York Stock Exchange Advance Decline line (NYAD) finally broke above its 50-day moving average providing the all clear signal we’ve been looking for. I’ve been expecting this type of activity for the past several weeks as each new low in NYAD has not been confirmed by the RSI creating a positive breadth divergence, such as we saw in November 2023. Now the market needs to build upon this rising momentum. Now we need to see NYAD gather steam to the upside and deliver a new high to confirm further upside momentum.

The U.S. Ten Year Note yield (TNX) continues to move lower in the short term. A test of the 50-day moving average is looming.

Bitcoin’s volatility (BTC/USD) is increasing as the cryptocurrency continues to hover between $90,000 and $100,000, but money seems to be trickling in and we may see a major short squeeze (ADI is falling and OBV is rising). We’ll see what happens here as well.

Thanks to everyone for your ongoing support. I really appreciate it.

Thanks also to all the current Buy Me a Coffee members and supporters. Special shout out to new members who now have access to the Sector Selector ETF Service, included, at no extra charge with your Buy Me a Coffee membership. Two new trades were posted yesterday.

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