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
Short Jan 12- $15.50 Call @ $0.31
Premium Collected - $3.55
AMC Long at $15.27
Short January $16 Call @ $0.27
Premium Collected - $2.25
UNIT Long at $17
Short January $17.50 Call @ $0.35
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The S & P 500 continued to tick higher, closing at 2,747.71. As I mentioned yesterday and on a few occasions, I do feel the ultimate target for this market is 2,812.50.
That price becomes the active objective when the S & P 500 has two closes above 2,753.93. And yesterday's close was about six points under the next upside level.
Having said that, I do want to review the upper extreme bollinger band levels on various timeframes.
On the daily chart, the upper band is 2,749.08. On the weekly chart, the upper band is 2,747.98.
As you can see, at the moment, price is right up against the upper band on both timeframes.
On the monthly chart, the upper band is 2,508.50. So, the market is trading about 240 points above the upper band on the monthly chart.
That level should act as support on a pullback, at this point.
We need to be midful that the S & P 500 is at extreme levels based on the bollinger bands.
Remember, the settings I use, which are a 253 day setting with a 2.576 offset, should contain 99.9% of all price action.
So, when price exceeds the upper ... or lower bands, it creates a rare event. And it creates probabilities if price can take out the upper band.
Earnings continue this week. Friday will hear from JP Morgan and Wells Fargo.
Tomorrow at 12:00 EST we will convene for our webinar. As always, please fee free to email me at davismdt@gmail.com, if there is a topic you would like me to cover.
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 close at 9.52. And the VIX diverged with the S & P 500. They both closed higher for the day.
To move higher, the VIX will need two closes above 10.16. 9.38 should continue to offer resistance.
Also, resistance should be at 10.55.
$SPX:
Major level: 2,812.50
Minor level: 2,792.98
Minor level: 2,753.93 **
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
The S & P 500 closed at 2,747.71, closing above the 2,734.40 objective. Support should now be at 2,734.40.
To move higher, the S & P 500 will need two closes above 2,753.93.
Resistance should be at 2,775. Minor support is at 2,739.30.
QQQ:
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: 155.47
Minor level: 153.91
Major level: 153.13
Minor level: 152.34
Minor level: 150.78
Major level: 150.00
The QQQ closed at 162.55. The QQQ took out the 162.50 objective.
Two closes above 164.06 and the new objective becomes 168.75.
162.11 should be minor support.
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 155.03. The objective should still be to 156.25.
154.69 should offer support. And 153.91 should also be minor 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
The TLT closed at 125.63. The TLT should test 128.13 again.
Support should be at 125.59 and 125.
GLD:
Major level: 128.13
Minor level: 127.35
Minor level: 125.78 **
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
The GLD closed at 125.31. The GLD did manage to close again above the 125 level.
125 is a key level for the GLD. A straddle could be the strategy at the moment.
A failure and the GLD could drop to 112. A breakout and the GLD could run to 137.
XLE:
Major level: 76.56
Minor level: 76.17
Minor level: 75.39 **
Major level: 75.00 <
Minor level: 74.61
Minor level: 73.83
Major level: 73.44
Minor level: 72.66
Minor level: 71.09
Major level: 70.31
Minor level: 69.92
The XLE closed at 75.42. It closed again above the major 75 level.
A close today above 75.39 and the XLE should test 76.56.
The XLE is above its upper band on the daily chart. The upper band in 74.97.
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 84.85. A retest of 84.38 should be the next minor move.
84.38 should offer support. 84.91 should offer minor resistance.
AAPL:
Major levels for Apple are 175, 171.88, 168.75, 165.63, 162.50, and 159.38.
Apple closed at 174.35, just under the 175 level.
Two closes above 175.78 and Apple should test 178.13. 173.83 should be minor support.
WATCH LIST:
Bullish Stocks: AMZN, GOOGL, BIIB, LMT, HUM, DIA, BIDU, HD, FB, AMGN, SWK, LH, DE, VRTX, PANW, NSC, COL
Bearish Stocks: SLG, EPR, HCN DXCM, AIV, HTA
Be sure to check earnings release dates.
