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
DBX Short Jan 31st-$17 call @ $0.70
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There is one position that expires today and that is the short $10 call on TEVA. TEVA closed yesterday at $9.97, so it is highly likely the calls will be assigned. Leave the position and if they are assigned, you will book the profit from the sale of the stock. If they are not assigned, I will look to sell more calls next week.
The grind up continues.
The S & P closed out yesterday at 3,205.37. The market closed 14.23 points higher.
This put the market just above the minor 3,203.10 level. And on towards the minor 3,242 level.
At this point, a move up to the upper band is most likely. The upper band on the daily chart is 3,304.
Last December, when the S & P was trading under the lower band on its daily, it certainly seemed rather implausable that the market would move up to the upper band. And now it is within 100 points of it.
That bottom last December under the lower band was at 2,346.58. The market is now about 1,000 points above that low.
And yesterday's range was 13.16 points. This was still below the daily average true range, but about twice the range from the prior two days.
And the day closed out at 99% of the daily price bar. So, the odds favor the violation of the high of 3,205.48 before the low of 3,192.32.
Support from yesterday's daily bar should be in the 3,199 area.
The weekly range so far is only a modest 21.85 points. With a weekly average true range of 63.89 range, the range is about one third of the average.
The midpoint so far is 3,195, so a close above this level and the week would close out with another bullish price bar.
But a range of 21.85 points is hardly a blow off top scenario.
With a blow off top, we would expect large range days. And we are just not seeing that.
I mentioned yesterday how shorting may not be the prudent thing at the moment and that still has not changed. But, the sentiment indicators continue to move higher.
But as I said yesterday, short term charts remain bullish so momentum is still to the upside.
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 exactly on the 12.50 level. So, at this point, one of two things will happen. Either the VIX heads higher or sells off against the 12.50 level.
But, we have to be aware that the VIX is at the all-time support level. It can move lower and test the 9.38 level. And at that point, the market would be even more ripe for a pullback.
At this point, minor resistance is at 13.28 and minor support is at 11.72.
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 3,205.37. The short term target should be to the minor 3,242.15 level.
3,203.10 should be minor support, so watch this level today.
Technical support is around 3,198.
QQQ:
Major level: 212.50 <<
Minor level: 211.74
Minor level: 210.17 **
Major level: 209.39
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 210.86. The QQQ closed just above the major 209.39 level for the second day. The objective should be to the 212.50 level.
At this point, support should be at 209.39.
The 208 area should still offer technical 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
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 165.73. The target for the IWM should be up to 168.75 level.
The minor 164.06 level should still offer support.
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 136.47. The TLT will still need two closes above 138.28 to move higher. Two closes under 135.84 and the TLT should continue down to 131.25.
137.50 should be resistance. And technical resistance is at that level as well.
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 139.38. A break under 138.28 and the GLD should continue lower.
Watch the 140.63 level on the upside. A break above it and the GLD should head higher. But, it should be resistance until it is violated.
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 61.37. The objective for the XLE should be for a move up to 62.50.
The XLE also closed just above the midband again. This level is now 61.02. If the XLE can hold above the midband, it should head higher.
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 280.02. At this point, Apple will need two closes under 277.35 to move lower.
And minor support should now be at 269.54. And technical support is around 277
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.
