January 2, 2015 - MDT Pro Tips A.M.

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 Jim Parker, 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....
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Working orders

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?Stocks...

Spu's...2054 is the pivot. Below... It can revisit 2022/ Above... Spu's need a close back over 2067 resistance.

IBB...299 is 50 DMA support, a must hold level. Price action back over 306 puts the Bulls back in charge.

U.S. Equities...it will be a big opening range trade today in the individual instruments.

Use Wednesday's close as your barometer.

Be patient with the U.S. Equity indices. The trade will not be a straightforward as the Dollar. A little time will be needed to ascertain the validity of the patterns from Wednesday.

Traders could be reticent to increase risk exposure before the Jan 22 ECB meeting.

Trade instruments on their own merits.

Bonds ...

30 yr. Bonds... there is currently a double top on the point & Figure charts @ 144.22, with resting buy stops above.

Price action under 144.00 will lead to lower prices and a stronger dollar.

FX...

EURO....the next set of sell stops are under 120.42, the 2012 low.

Euro is put in an ORL year and is following through to the downside..

GBP/JPY... This cross gains upside momentum over 187.25 close.

USD/JPY...there is no upside to the Yen unless there is a close under 118.60 ( over 84.30 Futures)

GBP/USD...153.50 is the next multi-year fib support. Pound crosses are all being unwound from last year.

Commodities...

OIL...54 will remain pivotal. Price action and a close over 55.50 resistance is needed to get excited about the long side.

Rallies continue to fail at resistance. I still have the 49 handle as a possible downside swing count.

Trade the price action. Sell rallies not breaks.

Natgas...put in an ORL year. Minimally this needs price action over 3.05 and a closes over 3.19 to rally.

General Comments or Valuable Insight

We saw a low volume puke Wednesday afternoon.
Lots of ORL's... XLF,XLV,IBB,IYT,IYC,XLY.

IWM put in an ORL right into short term momentum support @ 119.53.

I pulled my buy order in the Spu's Wednesday because I was looking for a break early in the day followed by a rally.?

What struck me the most was the lack of bid to the 30 yr. Bonds as the stocks were priced lower. In your head as a trader this should raise an alarm bell that one is not correct.

You generally don't see that much of a disconnect during a presumably risk off event between the Bonds and the Equity indices.

It's a big yearly opening range trade in the Dollar. Sell every rally to Wednesday's close in the Yen,Euro,Pounds & Aussie with a 25 point stop above the yearly close.

This is where traders have a comfort zone and trade location for Risk management.

I'll be compiling my 2015 1st qtr medium term technical outlook over the weekend.

For Medium Term Outlook click here.

For Glossary of terms and abbreviations click here.

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