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 $1.06
UNIT Long at $6.78
UNIT Short Feb 21st Call @ $.30
................................................................................
Before I begin to discuss this highly volatile market, I do need to mention that I suggested you close the NTAP position after a day.
The stock actually hit the price target I was looking for, so I felt it better to book the profit of 22% for one day.
As for this highly volatile market, yesterday saw a massive melt-up.
The day closed out 48.67 points higher at 3,297.59. The range for the day was only 26.31 points. This was only due to the fact that the market gapped higher at the open by 31.69 points.
And the day closed out at 65% of the range of the daily bar. It would actually be higher if you factor in the gap. So, this certainly suggests the market should continue higher.
Assuming this trading holds up until the open, the market should open around 3,320 or about 12 points above yesterday's high.
So, support should be at the high, which is 3,307 and the close, which was 3,297.59.
Another key support level now should be the high of the bearish long range candle from Friday, which is 3,282.33. Major resistance becomes support when it is violated.
The question now is where is this market headed?
We have our resistance levels to help us dissect where the market can go.
But, at this point, I think a test of the upper band would be the logical move. The upper band is 3,362 and yesterday's close is within 64 points of it. And with the projected open about 22 points higher, the market should be within 42 points of it at the open.
The other key support level to watch is the last week's high, which was 3,293.47. This should be a support level if profit-taking sets in.
The irrational trading in TSLA continues. Yesterday, it closed at $887,06, up $107.06 for the day.
As I mentioned yesterday, it is well above the upper band on its daily chart, which is now $556.60.
But, yesterday formed a doji bar and I do think you will see it pull back now.
With the price of the stock so high, the puts have become very expensive, which makes it very expensive to speculate on.
But, at the very least, you should not be putting on long positions up here. Wait for the pullback before you do that.
CMG reported last night and is trading about $16 higher. KLAC reported and is trading about $5 lower.
This afternoon we get earnings from GRUB and TWLO. And tomorrow morning, we get reports from BDX and REGN.
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 closed Friday at 16.05. Since hitting the 18.75 level, the VIX has now collapsed.
Target should be to the 15.63 level. Watch this level to see if it holds. If it can't, look for further downside.
Assuming it does not hold, minor support could come in at 14.85. The 14 area should also offer technical support.
S & P 500:
Major level: 3,427.40
Minor level: 3,398.35
Minor level: 3,320.25 **
Major level: 3,281.20 <
Minor level: 3,242.15
Minor level: 3,164.08
Major level: 3,125.00
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
The S & P closed at 3,297.59. This put the market above the 3,281.20 level.
This level should be support now on a pullback. And two closes above 3,320.25 and the S & P should move to 3,427.
Technical support is around 3,267.
Short term charts remain bullish.
QQQ:
Major level: 231.25
Minor level: 230.48
Minor level: 228.91
Major level: 228.13 <
Minor level: 227.35
Minor level: 225.78 **
Major level: 225.00
Minor level: 224.22
Minor level: 222.69
Major level: 221.91
Minor level: 221.13
Minor level: 219.56
Major level: 218.75
Minor level: 218.00
The QQQ closed at 227.47. The target should be to 228.13 and the QQQ should take that out at the open.
Watch the minor 228.91 level. Two closes above that level and the QQQ should move up to 231.25.
The QQQ closed back above the upper band on the daily chart. That price level is 226.33. This should now be support.
227.35 should be support.
Technical support is at 222. And the 229 area should be resistance.
IWM:
Major level: 175.00
Minor level: 173.44
Minor level: 170.31
Major level: 168.75
Minor level: 167.19
Minor level: 164.06 **
Major level: 162.50
Minor level: 160.94
Minor level: 157.81
Major level: 156.25
Minor level: 154.69
Minor level: 151.56
Major level: 150.00
The IWM closed at 164.77. With a close above 164.06 today, the IWM should move up to 168.75.
The IWM has already moved into a downtrend on its 60 minute chart.
The midband, which is 165, should be resistance. If the IWM can clear this level, it should then be support.
TLT:
Major level: 146.88 <
Minor level: 146.10
Minor level: 144.53
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: 135.84
The TLT closed at 143.58. The TLT closed under the major 143.75 level.
The TLT sold off from its short term overbought condition. I do expect a retest of the 146 area, but it will have to clear the 144 minor resistance level.
The midband on the 60 minute chart is 139 and should be support.
GLD:
Major level: 150.00
Minor level: 149.22
Minor level: 147.67
Major level: 146.89 <
Minor level: 146.11
Minor level: 144.54
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
The GLD closed at 146.43. 147.67 should now be resistance.
It is now oversold short term. And I would expect a bounce up to the 148 area.
The 149.22 level be resistance.
149 should be technical resistance. 147.67 should be support.
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: 55.47
Minor level: 53.90
Major level: 53.12 <
Minor level: 52.34
Minor level: 50.78
Major level: 50.00
The XLE closed at 52.93. The XLE will need to clear 53.12 to move higher. And it will need two closes above 53.90 to move up to 56.
The XLE is oversold short term. It is still trading just above the lower band on its 60 minute chart. That level is 52.54 and should be support.
The bounce should move to around 54. Watch to see if the XLE can clear this level.
AAPL:
Major level: 325.00
Minor level: 321.88
Minor level: 315.63 **
Major level: 312.50
Minor level: 309.38
Minor level: 303.13
Major level: 300.00
Minor level: 296.88
Minor level: 290.63
Major level: 287.50
Minor level: 284.38
Apple closed at 318.85. A close today above 315.63 and a move up tp 325 would be expected.
The 317 area should offer technical support. Assuming this holds, look for a bounce up to 325.
WATCH LIST:
Bullish Stocks: TSLA, SHOP, ADBE, PAYC, MCO, DXCM, APD, CME, NOW, RNG, CRM, DECK, MSFT, HSY, LLY, CBOE, WM
Bearish Stocks: ANTM, ALGN, MMM, FDX, AAP, LEA, FFIV, RL, FIVE, EXPE, CVX, ALXN, DLTR, XLNX, CXO, LOPE, FANG, EXPD, EOG
