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
SNAP Long at $14.54
Total Premium Collected - $1.65
RRC Long at $11.85
Total Premium Collected $0.70
RIG Long at $8.81
Premium Collected - $1.13
FEYE Long at $17.18
Total Premium Collected $0.80
CLW Long May - $20.00 call for $2.00
CLW Short May - $22.50 call for $1.00
AMC Long at $16.16
AMC Short April 18th - $16.50 call @ $0.35
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Both short calls position expired on Thursday. I will look to sell more this week.
After the short week, we are back to the regular market schedule this week. For the week, the S & P 500 closed 2.38 points lower. It ended the week closing at 2,905.03.
The range for the week contracted to only 26.10 points. With a weekly average true range of 73.45, the range was only 35% of the average.
Usually, you do expect slow trading on a short week, but last week seemed especially narrow.
And the weekly bar formed a doji with an open of 2,908.32 and a close of 2,905.03.
The high for the week was 2,918.00, or about 8 points above the minor 2,910.15 level. And the low for the week was 2,891.90 or within two points of the major 2,890.60 level.
So, essentially the market traded between the minor and major levels.
And once again, the S & P 500 could not close above the next upside level, which is 2,910.15.
Thursday's high came to 2,908.40. With all these attempts to try and close above 2,910.15 and failing to do so, at some point, I expect profit taking to set in.
On the downside, the major support level of 2,890.60 should continue to offer support. And if it is violated, I do expect the minor level of 2,871.08 to offer support the first time it is tested.
But, we would expect a move higher in the VIX to confirm a pullback. And at this point, the VIX has not had a major bounce.
At the least, I would expect a close above 12.50 on the VIX, but Thursday, it still managed to close under it. It did get as high as 13.12 before closing at 12.09.
The major technical event at the moment is if the 200 ema can cross above the 253 day average on the daily chart.
The 200 ema is now 2,747 and the 253-day average is 2,756. If the 200 ema can cross above the 253-day average, it would signify that the daily timeframe is bullish and would be in alignment with the weekly and monthly charts.
This would suggest that any pullback should be relatively shallow and we would expect the market to move up after any selloff.
This is certainly something I will continue to monitor.
Pre open, the S & P 500 is trading 9 points lower. Watch Thursday's low of 2,891.90. If this trading holds until the open, we should open about 4 points above the low.
If Thursday's low cannot hold as support, I would expect the market to continue lower.
Earnings begin to heat up this week. Facebook reports after the close on Wednesday, along with Microsoft.
Here are the Key Levels for the Markets:
$VIX:
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 out Thursday at 12.60. I am still biased for resistance at the 13.28 level.
Watch to see if the VIX breaks under 12.50. It closed only 10 cents above it on Thursday. Not much conviction.
12.89 is minor resistance.
On the downside, 12.11 is the key short term level to watch.
SPX:
Major level: 2,968.80
Minor level: 2,849.25
Minor level: 2,910.15 **
Major level: 2,890.60 <
Minor level: 2,871.08 **
Minor level: 2,832.03
Major level: 2,812.50
Minor level: 2,792.98
Minor level: 2,753.93
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
The key at the moment will be to see if the S & P 500 can close two days above 2,910.15. And it is starting to look like the market will not be able to.
No doubt the major 2,890.60 level will get tested again today. A violation of this level and it should reverse to resistance.
Based on where the S & P 500 is trading, it could drop to 2,734 level and the bull trend would still be intact.
From a technical standpoint, the 2,880 area should be support. And there is a minor support level at 2,878. So, I would expect strong support in this area.
Continue to buy against support.
QQQ:
Major level: 193.75
Minor level: 192.19
Minor level: 189.06 **
Major level: 187.50 <
Minor level: 185.94 **
Minor level: 182.81
Major level: 181.25
Minor level: 179.69
Minor level: 176.56
Major level: 175.00
Minor level: 173.44
Minor level: 170.31
Major level: 168.75
Minor level: 167.19
The QQQ closed out last week at 187.39. It hit the objective of 187.50 we have been calling for.
Like the S & P 500, the QQQ is overbought in the short term.
186.72 is short term support. And 186 is a technical support level.
Like the S & P 500, both short term charts are bullish. And like the S & P 500, the QQQ is very close to crossing into an uptrend on its daily chart.
Continue to buy against support.
IWM:
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 < HIT!
Minor level: 154.69 **
Minor level: 151.56
Major level: 150.00
Minor level: 148.44
The IWM closed at 155.64. Two closes above 157.81 and the IWM should test 162.50. Two closes under 154.69 and the IWM should drop to 150.
The midband is now 156.25 and the IWM is now back to closing just under the midband.
If the IWM can clear 156.24, it should head higher. Watch this level today as it should now be resistance.
Minor support is at 153.13.
Both short term charts are bullish. And technical support is around 154.
TLT:
Major level: 126.56
Minor level: 126.17
Minor level: 125.39
Major level: 125.00
Minor level: 124.61
Minor level: 123.83
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
The TLT closed at 122.90. If the TLT can close above 122.27 today, it should test 123.44.
122.66 should now be minor support. And 123.40 is technical resistance.
GLD:
Major level: 126.56
Minor level: 126.17
Minor level: 125.39
Major level: 125.00
Minor level: 124.22
Minor level: 122.66
Major level: 121.88
Minor level: 121.09 **
Major level: 120.31<
Minor level: 119.92
Minor level: 119.14
Major level: 118.75
The GLD closed at 120.37. With a close just above 120.31, look for this be support.
To move higher, the GLD will need two closes above 121.09. And at this point, 121.88 is resistance until it is violated.
The 60 minute chart still remains in a downtrend. And the 30 minute chart as well.
Technical resistance is still around 122.50.
XLE:
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
Minor level: 64.85
Minor level: 63.28
Major level: 62.50
Minor level: 61.72
Minor level: 60.16
Major level: 59.38
The XLE closed at 67.19. The key level at the moment is 67.97. A close today under 67.97 and the XLE should drop to 65.63.
66.80 is a short term support level. A break under 66.80 and the XLE should head lower.
I would expect strong support at the 65.63 level.
Short term charts remain bullish. Buy against support.
FXY:
Major level: 89.84
Minor level: 89.65
Minor level: 89.26
Major level: 89.06
Minor level: 88.87
Minor level: 88.48
Major level: 88.28
Major level: 87.50
Major level: 86.72
Major level: 85.94 <
Minor level: 85.75 **
Minor level: 85.36
Major level: 85.16
Minor level: 84.97
The FXY closed at 85.15. for the second day. Short term support is at 84.96. A break under this level and the FXY should continue to drop.
Next minor level to the upside is 85.36. On the downside, 84.96 is a minor support level. If the FXY cannot hold 84.96, I would expect it to head lower.
Short term charts are bearish. Technical resistance is at 85.67.
AAPL:
Major level: 206.25
Minor level: 204.69
Minor level: 201.56 **
Major level: 200.00
Minor level: 198.44
Minor level: 195.31
Major level: 193.75
Minor level: 192.19
Minor level: 189.06
Major level: 187.50
Apple closed at 203.86. I am biased for a move up to 206.25. However, short term resistance is at 204.69. Apple will need to clear this level to move up to 206.25
200.78 should offer support. And major support is at 200.
Short term charts remain bullish. Technical support is also around 200.
WATCH LIST:
Bullish Stocks: AVGO, COST, MA, ZBRA, SHOP, MMM, CP, MCD, CME, DE, CMI, ADP, V, VRSK, XLNX, DIS, KLAC, DG, MSFT, RCL, PRU, MAN, ETN
Bearish Stocks: NFLX, HUM, BDX, CI, ALNY, SQ, COP, OXY, WSM, GRUB, HLF, EAT, JWN, SIG, CLVS, GES
Be sure to check earnings release dates.