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
Total Premium Collected $1.95
ASNA Long at $14.20
Total Premium Collected $0.75
DUST Long $4.50
Total Premium Collected $0.70
AMC Long at $15.27
Short April 20th-$15.50 call @ 0.60
Premium Collected - $3.70
UNIT Long at $17.00
Premium Collected - $0.35
VRX Long at $16.40
Premium Collected - $0.50
SNAP Long at $14.54
Short April 13th-$15 call @ $0.30
Premium Collected - $0.30
KMI Long September $15 call @ $1.10
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With VRX closing at $15.44 on Friday, the $16.50 call expired worthless. You therefore, have booked the 50 cent per share profit you received from selling the calls.
I will look to sell another round of calls against this position this week.
And for this week, we have one position expiring this Friday. That is the short $15 call on SNAP.
Yesterday, the S & P 500 closed 58.37 points to the upside. It closed at 2,604.47. With the daily average true range at 50.76, these daily swings are not to be unexpected.
The high for Friday was 2,656.88. There was 58 cents above the major 2,656.30 level. This now sets up a scenario where if the S & P 500 closes under 2,636.75 today, it should drop to 2,578.10.
Resistance from Friday's daily bar is in the 2,721 to 2,625 area. There is also a minor resistance level at 2,646.50.
The positive from Friday was that the session did qualify as a selling climax. The down to up volume was 11.29.
Friday was now the third selling climax of this pullback.
For the week, the S & P 500 closed 36.40 points to the downside. With Friday closing 58 points lower, it tells us that the market managed to rally during the week before giving back all the gains on Friday.
And the weekly range was 118.28 points. This was greater than the weekly average true range, which is 80.27. So the weekly range was almost 150% greater than the average.
The levels to watch from last week's weekly price bar are in the 2,613 to 2,619 area.
With the market closing under these levels, I would expect resistance there.
Both the 30 minute and 60 minute charts are still in downtrends. This tells us that if the market does bounce, we should get another downleg.
Watch the VIX for a reversal to the downside to help time any long entries.
Pre open, the S & P 500 is trading about 12 points to the upside. Watch the resistance levels I outlined above.
Continue to monitor the longer term levels for the market.
Here are the Key Levels for the Markets:
$VIX:
Major level: 31.25
Minor level: 29.69
Minor level: 26.56
Major level: 25.00
Minor level: 23.44 **
Minor level: 20.31
Major level: 18.75 <
Minor level: 17.19
Minor level: 14.06
Major level: 12.50
Minor level: 10.94
For the moves we have seen in the markets, the VIX is just not confirming them. In fact, the VIX continues to trade under the major 25 level, and under the upper band on the daily chart. The upper band is 24.15 and Fridays high was 23.12 or about one point under it.
The VIX closed at 21.49 on Friday yesterday. The VIX as low as 18.60 Friday before rallying to move higher.
The VIX is trading between the major 25 and 18.75 levels. If the VIX closes today above 20.31, it should test 25 again.
$SPX:
Major level: 2,734.40
Minor level: 2,714.88
Minor level: 2,675.83
Major level: 2,656.30 **
Minor level: 2,636.75 <
Minor level: 2,597.65
Major level: 2,578.10
Minor level: 2,558.58
Minor level: 2,519.53
Major level: 2,500.00
The market sold off almost to the tick off the major 2,656.30 level on Friday. This now sets up a scenario where if the S & P 500 closes under 2,636,75 today, it should test 2,578.10.
A major price level on a higher timeframe is 2,617.25. And with Friday's close under that level, I would expect is to offer resistance. It should be a level to watch.
QQQ:
Minor level: 165.63
Major level: 162.50
Minor level: 159.38 **
Minor level: 153.13
Major level: 150.00 <
Minor level: 146.88
Minor level: 140.63
Major level: 137.50
The QQQ closed at 156.63, closing under the 159.38 minor resistance level. A close today under 159.38 and the objective should be down to 150.
Minor resistance is at 159.38. And 153.13 is a minor support level. Both the 30 and 60 minute charts remain bearish.
IWM:
Minor level: 153.91
Major level: 153.13
Minor level: 152.35 <
Minor level: 150.78 **
Major level: 150.00
Minor level: 149.22
Minor level: 147.66
Major level: 146.88
The IWM closed at 150.36. 150 should be a support level. A break under this level and the IWM should head lower.
To move lower, the IWM will need two closes under 149.22. Also, a major level is 146.88. If the IWM has two closes under 146.88, it could drop to 137.
TLT:
Major level: 123.44
Minor level: 123.05
Minor level: 122.27
Major level: 121.88 **
Minor level: 121.49
Minor level: 120.70 <
Major level: 120.31
Minor level: 119.92
Minor level: 119.14
Major level: 118.75
Minor level: 118.36
The TLT closed at 121.10. A close today above 120.70, and the TLT should test 121.88.
A minor resistance level is at 121.09 and the TLT closed one cent above it. Watch this short term level. If the TLT cannot hold this level, it should drop.
GLD:
Major level: 131.25
Minor level: 130.47
Minor level: 128.91
Major level: 128.13
Minor level: 127.35
Minor level: 125.78 **
Major level: 125.00 <
Minor level: 124.22
Minor level: 122.66
Major level: 121.87
The GLD closed at 126.39. Looking for a retest of 125. Minor resistance is at 126.56. If the GLD cannot clear this level, I expect a test of 125.
125 should continue to be support. Watch this level. A break under 125 and the GLD should head lower.
XLE:
Minor level: 76.95
Major level: 76.56
Minor level: 76.17
Minor level: 75.39
Major level: 75.00
Minor level: 74.22
Minor level: 72.66
Major level: 71.88
Minor level: 71.10
Minor level: 69.53
Major level: 68.75 <
Minor level: 67.97
Minor level: 66.41 **
Major level: 65.63
The XLE closed at 67.35. The XLE continues to bounce between the 65.63 and 68.75 levels. And the 200 ema and the midband on the daily chart.
The 200 ema is 67.97 and the midband is 66.70.
67.19 should be minor support. And if the XLE drops under 66.80, I would expect a retest of 65.63.
FXY:
Major level: 92.19
Minor level: 92.00
Minor level: 91.61
Major level: 91.41
Minor level: 91.22
Minor level: 90.83
Major level: 89.06 **
Minor level: 88.87
Minor level: 88.48
Major level: 88.28
Minor level: 88.09
The FXY closed at 89.68. Friday's low stopped at 89.32, just 4 cents above the 89.28 short term support level, I mentioned Friday.
Look for support at the 89.06 level. And for the FXY to move higher, it will need two closes above 90.83. Short term oversold.
AAPL:
Minor level: 178.91
Major level: 178.13
Minor level: 177.35
Minor level: 175.78
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
Apple closed at 168.38. Minor support is at 167.19.
If Apple can regain the major 168.75 support level, it should move higher.
WATCH LIST:
Bullish Stocks: HUM, MCD, PVH, BURL, RL, KSU, CLB, PSX, VLO, LULU, YUM, KORS, LEN, COP, CLR, APC, HFC, MTH
Bearish Stocks: AVGO, ADS, WHR, CB, ALXN, DGX, WST, MDT, TAP, WBA, CERN, LUV, CTRP. ALKS, CRUS, BEN
Be sure to check earnings release dates.