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
SNAP Long at $15.20
Premium Collected - $3.24
Short Dec 22nd- $16 Call @ $0.45
AMC Long at $15.27
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THC Long at $14.63
Premium Collected - $1.70
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The melt up continues. The S & P 500 closed at 2,690.16, up 14.35 points on the day.
The high for the day was 2,694.97, which put the market within 33 cents of our next upside target, which happens to be 2,695.30.
Close enough to say it has been hit.
The next level above 2,695.30 is 2,734.40. The S & P 500 will need to close above 2,705.07 for that level to become the active target.
But after running three levels, 2,705 could offer resistance. And 2,734.40 could be a difficult price to get through on the first attempt.
But, with the market breaking above 2,656, I would most certainly expect another rally should the market pullback.
The question now is where can this market ultimately go?
I think it is quite possible the S & P 500 goes to 2,812.50. To do that, it will need to close above 2,695.35 for two days. At least that is a critical level to watch for a move much higher.
Having said that, the VIX is once again back down to all time lows.
Certainly, buying the VIX has been the wrong strategy. Just like shorting the markets.
But, the VIX closed yesterday at 9.53, after hitting a low of 9.24.
As you know, this brings the VIX down to the long term support level of 9.38. The question is will the VIX bounce off this level?
Considering it has for two years now, I would not be shocked if it happened again.
But, I would still expect higher levels for the VIX to offer resistance.
A bounce in the VIX here and you would want to perhaps consider not initiating any new longs.
And if the market did pullback, support from last week's weekly price bar should still be in the 2,664 to 2,666 area.
Continue to follow the resistance levels.
Here are the Key Levels for the Markets:
$VIX:
Major level: 14.06
Minor level: 13.67
Minor level: 12.89
Major level: 12.50
Minor level: 12.11
Minor level: 11.33
Major level: 10.94
Minor level: 10.55
Minor level: 10.16 **
Major level: 9.38 <
Minor level: 8.99 **
Minor level: 8.20
Major level: 7.81
The VIX closed at 9.53. Yesterday, both the VIX and the S & P 500 closed to the upside, which is a divergence.
To move higher, the VIX will need two closes above 10.16.
Watch to see if the 9.38 level holds today. If it does, the S & P could pullback in the short term.
$SPX:
Major level: 2,734.40
Minor level: 2,724.23
Minor level: 2,705.07
Major level: 2,695.30 <
Minor level: 2,685.55 **
Minor level: 2,666.05
Major level: 2,656.30
Minor level: 2,646.53
Minor level: 2,626.98
Major level: 2,617.20
Minor level: 2,607.43
The S & P 500 is within 50 cents of the 2,695.30 objective.
Short term support is at 2,673.30 and 2,680.80.
And short term resistance could come in at 2,711.20.
QQQ:
Major level: 162.50
Minor level: 160.94
Minor level: 157.81 <
Major level: 156.25 **
Minor level: 155.47
Minor level: 153.91
Major level: 153.13
Minor level: 152.34
Minor level: 150.78
Major level: 150.00
The QQQ jumped nicely and closed at 158.64. A close today above 157.81 implies a move up to 162.50.
Support should be at 157.81.
IWM:
Major level: 156.25
Minor level: 155.47
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 154.30. The IWM took out the 153.13 level.
A close today above 153.91 and the objective should be to 156.25.
At this point, 153.13 should be support.
TLT:
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: 124.61
Minor level: 123.83
Major level: 123.44
Minor level: 123.05
Since taking out the 128.13, the TLT sold off and closed at 127.18. For the day, it was down 1.17. This now implies that if the TLT closes under 127.35 today, it should test 125.
126.78 is minor support. And 127.73 should be resistance.
GLD:
Major level: 125.00
Minor level: 124.22
Minor level: 122.66
Major level: 121.88
Minor level: 121.10
Minor level: 119.53 **
Major level: 118.75 <
Minor level: 117.96
Minor level: 116.41
Major level: 115.63
The GLD closed at 119.73.
To move up to 121.88, the GLD would need two closes above 119.53. Watch to see if the GLD can clear 119.53. The GLD will need to close above 119.53 today to test 121.88.
I would expect resistance at the 121.88 level. And minor resistance is at 119.92.
XLE:
Major level: 73.44
Minor level: 72.66
Minor level: 71.09
Major level: 70.31
Minor level: 69.92
Minor level: 69.14 **
Major level: 68.75 <
Minor level: 68.36
Minor level: 67.58
Major level: 67.19
The XLE closed at 69.25. This now suggests that if the XLE can close above 69.14 today, it should test 70.31.
68.95 should be short term support. And certainly 68.75, which was tested yesterday.
The daily chart is close to crossing into an uptrend. If the daily can cross into an uptrend, I would expect another leg up.
FXY:
Major level: 86.72
Minor level: 86.53
Minor level: 86.14
Major level: 85.94
Minor level: 85.75
Minor level: 85.36
Major level: 85.16 <
Minor level: 84.96 **
Minor level: 84.55
Major level: 84.38 <<
The FXY closed at 85.26. 85.16 should still be support. Watch to see of this level holds.
84.96 should be minor support. If this level holds, I would expect a move back up to 86. If the FXY breaks under it, a drop to test 84.38 is likely.
AAPL:
Major levels for Apple are 175, 171.88, 168.75, 165.63, 162.50, and 159.38.
Apple took out the 175 level we were looking for. It closed at 176.42.
A close today above 175.78 and Apple should test 178.13.
175 should be strong support.
WATCH LIST:
Bullish Stocks: GOOGL, TSLA, BIIB, LMT, BA, DIA, SPY, COST, RTN, LH, ACN, CLX, CAT, JPM, AFL, MSFT, GILD
Bearish Stocks: VMC, JACK, CLB, KEX, CRH, NFX, TDS, CXW, RRC, RDC
Be sure to check earnings release dates.