While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points.
Current Positions
GOGO? Long at $19.93
Premium collected - $1.25
NCR Long Jan 15 $27 Call
Net Debit - $1.70
VNR Long at $8.91
Short September $9 call @ $.50
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Last week ended up with a slightly higher close on the S & P 500.
I had expected the VIX to top out last Wednesday and it made a slightly higher push which resulted in a drop in value for our weekly options.
As I have said before, when trading weekly options you really need to be perfect on entry, direction and you generally need an expansion in price.? It does you no good to watch the stock remain stagnant.
The good thing about weeklies is that you are not paying a lot for time premium.
But because of the extreme volatility in the markets right now, any long weekly positions will be limited to a .5% allocation.
Perhaps we will get some clarity this week with the long awaited Fed announcement due this Thursday.
This Wednesday at 12:00 EST, will be a our webinar.
If you have any questions or comments for the webinar, please email them to me at davismdt@gmail.com.?
Now onto the markets.
Here are the key levels for the markets.
Stocks...
?
VIX:?
Minor level - 32.81
Major level - 31.25
Minor level - 29.68
Minor level - 26.56
Major level - 25.00
Minor level - 23.44 *
Major level - 18.75
The VIX finally broke under the 25 level and closed Friday at 23.22.? If it can close under 23.44 today, I would epect a move down to 18.75.
The VIX is back under the upper bollinger band on the daily chart.
S & P 500 Cash Index:?
Minor level - 2,007.82
Major level - 2,000.00
Minor level - 1,992.18
Minor level - 1,976.62
Major level - 1,968.80
Minor level - 1,945.32 *
Major level - 1,937.50
Minor level - 1,929 .68
Minor level - 1,914.12
Major level - 1,906.30
The objective should be to 1,968.80.
Minor resistance should exist at 1,976.62 and support should be at 1,945.32.
Nasd 100 (QQQ):?
Major level - 112.50
Major level - 109.38
Minor level - 107.03
Major level - 106.25
Minor level - 105.46
Minor level - 103.91 *
Major level - 103.13
Minor level - 102.34 *
Major level - 100
106.25 should be the objective.? Support should be at 103.91.
TLT:?
Major level - 131.25
Major level - 128.13
Minor level - 125.78
Major level - 125
Minor level - 124.22
Minor level - 122.66
Major level - 121.88
Minor level - 121.09 *
Minor level - 119.53 *
Major level - 118.75
The TLT continues to trade between the 121.88 and 118.75 levels.
The TLT is trying to regain the 121.88 level.? If it can close above that level, it would try and move up to 125.
Short term timeframes have moved into a downtrend.
GLD:
Major level - 112.50
Minor level - 110.16 *
Major level - 109.38
Minor level - 108.60 *
Minor level - 107.03
Major level - 106.25
Minor level - 105.46
Minor level - 103.91
Major level - 103.13
The GLD closed just under the 106.25 level at 106.16 on Friday.
Two closes under 105.46 and it should drop to 103.13.?
It is getting closer to a long term bottom.
XLE:
Major level - 68.75
Minor level - 66.41 *
Major level - 65.63
Minor level - 64.84
Minor level - 63.28 *
Major level - 62.50
Minor level - 61.72
Friday's low was one penny above the 62.50 level.
62.50 should be a strong level of support.
Like Gold, the XLE looks to be forming a long term bottom.
Apple:
Major levels for Apple are 112.50, 106.25, 100, 93.75 and 87.50.
100 should be a major support level for Apple.?
I would expect 110.90 to be support.
Watch list:
Bullish Stocks:? MLM, VMC, RCL, ALK, DY, GAS, MOH, CTB,
Bearish Stocks: ALXN, MMM, BIDU, FFIV, KMB, MON, WYNN, BG, DECK, QCOM
Be sure to check earnings release dates.
