While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to a 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
Total Premium Collected $1.95
ASNA Long at $14.20
Total Premium Collected $0.75
DUST Long $4.50
Total Premium Collected $0.70
RRC Long at $11.85
Total Premium Collected $0.70
RRC Long at $9.20
RIG Long at $8.81
Premium Collected - $1.45
FEYE Long at $17.18
Total Premium Collected $0.80
TEVA Long at $9.78
TEVA Short Dec 20th - $10 Call - $0.26
DBX Long at $17.18
CASY Long Jan 17th - $155 Call - $3.90
CASY Short Jan 17th - $160 Call - $1.60
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Yesterday, I suggested you sell a call against the DBX position. The expiration is about a month away, so hold the position until an adjustment is suggested.
The S & P continued to tick higher. The S & P closed 1.07 points higher. The day closed out at 3,192.52.
The daily intra day range was only 7.19. You have to go back to July 15th to find a day with a range less than 10 points.
And as it turned out on July 15th, both the S & P and the VIX closed higher. And that is what happened yesterday. The S & P closed 0.53 points higher on July 15th, compared to the 1.07 point higher close yesterday.
Back in July, the market pulled back 41 points off this setup. But, it did recover to go onto making a higher high.
Can this happen this time?
Why not?
I tend to research past market action to help determine what can happen in real time, especially now when the sentiment indicators are overbought.
But, the major reason we may see a bit of a pullback is the VIX. Back in July, the VIX has also fallen under 12.50 and on July 15th, it closed at 12.68 or back above the 12.50 level.
Yesterday, the VIX closed at 12.29 or still below the 12.50 level. But, both days diverged. Both days the S & P and the VIX closed to the upside.
Will yesterday signify a short term top for the market?
I don't know, but with the VIX down to all-time lows, we need to be aware that a reversal could happen.
The key levels for today are the high of 3,198 and the low of 3,191. Also, watch the close of 3,192.52.
Pre open, the S & P is trading about a point higher.
FDX reported last night and is trading about $12 lower.
MU reports today after the close. NKE reports Thursday after the close.
Here are the Key Levels for the Markets:
$VIX:
Major level: 21.88
Minor level: 21.10
Minor level: 19.53
Major level: 18.75
Minor level: 17.97
Minor level: 16.41
Major level: 15.63
Minor level: 14.85
Minor level: 13.28
Major level: 12.50 <
Minor level: 11.72 **
Minor level: 10.16
Major level: 9.38
The VIX sold off again and closed out the day at 12.29. As I mentioned above, both the S & P and the VIX closed to the upside. This is a divergence.
Watch the 12.50 level. It should still be resistance until it is violated. And 13.28 should be resistance as well.
14.25 should offer technical resistance.
SPX:
Major level: 3,281.20
Minor level: 3,242.15
Minor level: 3,164.08 ***
Major level: 3,125.00 < Hit
Minor level: 3,085.95
Minor level: 3,007.85
Major level: 2,968.80
Minor level: 2,929.73
Minor level: 2,851.58
Major level: 2,812.50
Minor level: 2,773.45
The S & P closed at 3,192.52. This was the second close above 3,164.08, which puts the upside for the S & P to the 3,281.20 level.
Also, we now have two closes above the minor 3,183.58 level, which suggests the S & P should move up to 3,242.15. The minor 3,183.58 level should also be support.
Technical support is around 3,182.
QQQ:
Major level: 212.52
Minor level: 211.74
Minor level: 210.17 **
Major level: 209.39 Hit
Minor level: 208.61
Minor level: 207.04
Major level: 206.25
Minor level: 205.48
Minor level: 203.91
Major level: 203.13
Minor level: 202.35
Minor level: 200.78
Major level: 200.00
The QQQ closed at 209.39. The QQQ closed exactly on the major 209.39 level.
The next minor level is 210.17.
208.61 is minor support. 208 should offer technical support.
IWM:
Major level: 168.75
Minor level: 167.19
Minor level: 164.06 **
Major level: 162.50 Hit
Minor level: 160.94 **
Minor level: 157.81
Major level: 156.25
Minor level: 154.69
Minor level: 151.56
Major level: 150.00
Minor level: 148.44
Minor level: 145.31
Major level: 143.75
The IWM closed at 164.70. This was the first close above 164.06. A close today above 164.06 and the IWM should move up to 168.75.
162.50 should offer strong support. Not only is it a resistance level, but it is a technical support level.
Short term charts remain bullish, so momentum is still bullish. Same as yesterday, the 164 area should be technical support.
TLT:
Major level: 143.75
Minor level: 142.97
Minor level: 141.41
Major level: 140.63
Minor level: 139.85
Minor level: 138.28 ***
Major level: 137.50 HIT
Minor level: 135.84
Minor level: 132.81
Major level: 131.25
The TLT closed at 137.60. The TLT will still need two closes above 138.28 to move higher.
Major support is at 137.50. So if the TLT moves under it, expect it to keep dropping. And at this point, the TLT has been holding this level. A break under it and expect the TLT to drop.
GLD:
Major level: 143.75
Minor level: 142.97
Minor level: 141.41
Major level: 140.63
Minor level: 139.85 **
Minor level: 138.28
Major level: 137.50
Minor level: 136.72
Minor level: 135.16
Major level: 134.38
The GLD closed at 139.01. A break under 138.28 and the GLD should continue lower.
137.50 should be strong support. So if the GLD does break under it, I would expect it to head lower.
The key level is 134.38 on the downside. If the GLD has two closes under this level, it could drop to 125.
Technical resistance is around 140. And the 139.85 level should be resistance.
XLE:
Minor level: 63.28
Major level: 62.50
Minor level: 61.72
Minor level: 60.16 **
Major level: 59.38 <
Minor level: 58.60
Minor level: 57.03
Major level: 56.25
Minor level: 55.86
Minor level: 55.08
Major level: 54.69
The XLE closed at 61.16. This was the second close above 60.16, which now implies that the XLE should move up to 62.50.
The XLE also closed just above the midband again. This level is now 60.99.
The 61 area should be technical support.
The XLE has still not crossed into an uptrend on the daily chart, but it is inching closer.
AAPL:
Major level: 281.25 HIT
Minor level: 277.35
Minor level: 269.54
Major level: 265.63
Minor level: 261.72
Minor level: 253.91
Major level: 250.00
Minor level: 246.88
Minor level: 240.63
Major level: 237.50
Apple closed at 280.41. Apple hit the 281.25 objective yesterday, hitting a high of 281.77.
And minor support should now be at 269.54. And technical support is around 268.
Needless to say that short term trends remain bullish.
WATCH LIST:
Bullish Stocks: GOOGL, SHOP, TSLA, ADBE, AVGO, MA, DPZ, ASML, AAPL, BDX, ZBRA, NVDA, GS, BABA, V, MCD, URI, CB, MSFT, JPM
Bearish Stocks: SPG, SJM, WBA, PLCE, CVLT, CAKE, SAVE, IRM, FL, BEN
Be sure to check earnings release dates.