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
FEYE Short Jan 17th - $19 Call @ $0.26
X Long at $11.33
NET Long at $17.09
NET Short Jan 17th - $17.50 call @ $0.55
FDX Long Jan 17th - $150 Put for $3.05
FDX Short Jan 17th - $145 Put for $1.37
DG Long Jan 31st - $152.50 Call @ $2.90
DG Short Jan 31st - $155.00 Call @ $1.70
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Before I begin, I need to mention that there are a few positions that expire today. The short $19 call on FEYE should no doubt expire today. FEYE settled yesterday at $17.34, below the strike. Allow the call to expire.
The short $17.50 call on NET expires today as well. NET closed about 2 points above the strike, so no doubt the calls should be exercised today. And I suggest you allow that to happen.
Finally, the put spread on FDX also expires today. Unfortunately, this trade did not work out. But, by limiting the trade size, the risk was about 1% of the nominal portfolio.
Also, I suggested you close out the DBX position yesterday. The result was a profit of about 2.5% for a month.
Now back to the markets.
The S & P 500 continued its torrid pace yesterday. And the move higher accelerated.
The day close out 27.52 points higher. And the S & P closed at 3,318.81.
This put the market within 1 point of the next upside level, which is 3,320.25.
And the S & P continues to inch toward the upper band on the daily chart. This level is now 3,325 and yesterday's high was within 6 points of the upper band.
As you know, it is important to watch this level to see how the market reacts.
And with the S & P closing at 98% of the range of the daily bar, the odds favor the continuation of this move.
And pre open, the S & P is trading about 8 points higher. This would put the open around 3,325 or about 8 points above yesterday's high. This would also put the market right at the upper band.
Watch to see if the market can clear the upper band.
On the downside, support should be at 3,317.11, which is yesterday's high and at the minor 3,320.25 level.
In looking at how the weekly bar is shaping up, we see that the midpoint is 3,293, and the market should close above it.
The weekly range through yesterday is 48.68, which is 12.50 points below the weekly average true range.
If we project the range for the week to be the average, it would put today's high around 3,330.
Support from yesterday's daily bar is in the 3,310 area.
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 12.32. The VIX continues to trade around the major 12.50 level and cannot close above it.
Resistance should still be at 12.50 now and at the minor 13.28 level.
This is now at the long term major support level. Watch this level for support. If it does break under 12.50, watch the next minor level, which is 11.72.
13.28 should be resistance. The 12.50 area is also technical resistance.
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 3,316.81. The next minor level on the upside is 3,320.25. Two closes above this level and the S & P should head up to 3,437.40.
3,281.20 should now act as support. And with a projected open above 3,320.25, it should be support.
Technical support is still at 3,300.
QQQ:
Major level: 225.00
Minor level: 224.22
Minor level: 222.69 **
Major level: 221.91 HIT!
Minor level: 221.13
Minor level: 219.56
Major level: 218.78
Minor level: 218.00
Minor level: 216.43
Major level: 215.65
Minor level: 214.87
Minor level: 213.30
Major level: 212.50
The QQQ closed at 222.28. The QQQ took out the 221.91 objective.
Another target hit.
The QQQ is right at the upper band on the daily chart. The upper band is now 221.58. Watch to see if the QQQ can clear the upper band. And it cleared it yesterday.
The next minor level is 222.69. And 221.13 should now be support.
And technical support is at 221.
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 169.53, the objective hit for the IWM. It took out the 168.75 level.
The 167.19 level should offer support. And the next upside level is 170.31.
And the 165 area should also offer technical support. 168 is the upper band on the daily chart for the IWM. The IWM cleared the upper band and it should now be 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 **
Minor level: 135.84
Minor level: 132.81
Major level: 131.25
The TLT closed at 139.21. The objective for the TLT should now be to 140.63. But, it has to reclaim the minor 139.85 level. If it can't, it should pull back.
137.50 should continue to be support. And technical support should be around 139.
GLD:
Major level: 150.00
Minor level: 149.22
Minor level: 147.67
Major level: 146.89 Hit
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 146.31. The objective should be for a drop to 143.75. But, if the GLD clears 146.89, it should head higher and void the 143.75 objective.
146.89 should be minor resistance, until it is violated.
The 145 area should still offer technical support.
The key level is 134.38 on the downside. If the GLD has two closes under this level, it could drop to 125.
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 59.50. The objective should be up to 62.50. But, at this point, it will need to clear 60.16. And yesterday, for the third day, the XLE closed just below it.
Watch for support at the 59.38 level. And yesterday closed just above it. It should still be support. This level continues to hold as support.
Technical support is still around 59.
AAPL:
Minor level: 315.63 **
Major level: 312.50 Hit
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
Minor level: 278.13
Major level: 275.00
Apple closed at 315.24. Apple would still need two closes above 315.63 level to move higher. Apple held the 312.50 level, which should be support.
The upper band is now 311.42.
309.38 should offer support.
The 309 area should offer technical support.
WATCH LIST:
Bullish Stocks: GOOGL, CHTR, LMT, ADBE, NTES, MA, AAPL, NVDA, GS, RTN, FB, LHX, CME, MCD, HD, COUP, MSFT, SPOT, SPLK, UHS, IBM
Bearish Stocks: AAP, FFIV, DLTR, TSCO, CTSH, DD, FIZZ, THS, RAMP, BERY, CIT, SIX