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 $.75
DUST Long $4.50
Total Premium Collected $.70
SNAP Long at $14.54
Total Premium Collected - $2.37
Short June 20th - $15.50 call @ $.27
RRC Long at $11.85
Total Premium Collected $.70
RRC Long at $9.20
RIG Long at $8.81
Premium Collected - $1.45
FEYE Long at $17.18
Total Premium Collected $.80
.........................................................................................
The S & P 500 opened with a massive 27.43 point gap above Friday's high.
The gap put the S & P 500 above the upper bollinger band on several short term intraday charts. So, you would not expect a continuation higher after the open.
And that is what happened.
The high for the day came in at 2,977.93 and that was right at the open. Actually, the top came at 9:39 EST.
From that point, the S & P 500 pulled back to a low of 2,952.22 before finding support at 2:30 EST. After the bottom, the market rallied for the next hour and one half, into the close of 2,964.33.
The intra day range ended up at 25.71 points. If you measure from Friday's high to todays high, you get 33.96 points. This of course, is because of the gap.
The daily average true range is now 26.41 points. And the actual intraday range was right around the average. If you factor in the high to high relationship, the range actually exceeded the average.
The daily bar actually closed at 47% of the daily bar. This is technically a doji bar, which can mean indecision.
Based on the price levels, you no doubt recognize that the high took out the objective we have been looking for. That is the major 2,968.80 level.
But, the S & P 500 could not close above it. The close of 2,964.33 ended up being about 5 points under the major level.
Though I would have preferred a close above the key level, the fact that it traded above 2,968.80, I consider a major event. As you know, the past two times it failed to clear this level, the market had deep corrections.
The question now is where does the market go?
I have adjusted the resistance levels to accommodate this price action. You will notice that the distance between the major levels have expanded.
This tells us that the market pullbacks can be deep and not affect the bull market.
The support area from yesterday's daily bar is in the 2,965 to 2,968 area. This is also around the close, so watch this area today.
Short term trends remain bullish.
Pre open, the S & P 500 is trading to the downside about 1.50.
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
The VIX closed Friday at 14.06. 14.06 happens to be a minor price level.
And with a close under 14.85 today, the downside objective should be to 12.50.
14.84 should offer resistance.
SPX:
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 << HIT
Minor level: 2,929.73 **
Minor level: 2,851.58
Major level: 2,812.50
Minor level: 2,773.45
Minor level: 2,695.35
Major level: 2,656.30 ***
Of course, you know that the active objective to the 2,968.80 level has been hit.
Now, we will need to see two closes above it.
I highlighted the 2,656.30 level because the S & P 500 could sell off all the way down to this level and the trend would still be bullish. That would be a two level drop from the current level.
Trend remains firmly bullish.
QQQ:
Major level: 193.75
Minor level: 192.19
Minor level: 189.06 **
Major level: 187.50 < Hit
Minor level: 185.94 **
Minor level: 182.81
Major level: 181.25 <
Minor level: 179.69
Minor level: 176.56
Major level: 175.00
The QQQ closed at 189.26. This now implies that if the QQQ closes above 189.06 today, it should move up to 193.75.
188.28 should offer minor support. And minor resistance is at 192.19.
Technical support is at 187. Short term charts remain firmly bullish.
IWM:
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 156.10. The high for the day was 158.03 or above the major 156.25 level. But, the IWM did close just under it.
However, the IWM is now above the midband, which is 154.54. In fact, yesterday's low of 155.22 is above it. This should now be support on a pullback.
Short term trends remain bullish. So, buying against support is the best strategy.
TLT:
Major level: 134.38
Minor level: 133.60
Minor level: 132.03 **
Major level: 131.25
Minor level: 130.47
Minor level: 128.91
Major level: 128.13
Minor level: 127.74
Minor level: 126.95
Major level: 126.56
Minor level: 126.17
Minor level: 125.39
Major level: 125.00
The TLT closed out at 132.24. It was down 0.09 on the day. The TLT continues to trade just under the upper band, which is 133.49.
Looking for a move down to 131.25, which should offer support. 132.81 should offer resistance.
GLD:
Major level: 134.48
Minor level: 133.60 **
Minor level: 132.03
Major level: 131.25
Minor level: 130.47
Minor level: 128.91
Major level: 128.13
Minor level: 127.74
Minor level: 126.95
Major level: 126.56
Minor level: 126.17
Minor level: 125.39
Major level: 125.00
Minor level: 124.22
Minor level: 122.66
The GLD closed at 130.62. The GLD closed 2.58 points lower. It broke hard under the upper band, which is 131.67.
128.13 should offer support. But, I am biased for more movement to the downside.
Hopefully, my warning last week not to get sucked into this market let you avoid any buys.
134.38 should be resistance.
XLE:
Major level: 65.63
Minor level: 64.85
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
The XLE closed at 63.77. If the XLE can close above 63.28 today, it should move up to 65.63.
I said this yesterday ... "The 63.62 resistance level should now be support." And as it turned out, the low for the day was 63.61.
64.06 is a minor resistance level. Technical support is at 63.
AAPL:
Minor level: 203.13
Major level: 200.00
Minor level: 196.88
Minor level: 190.63 **
Major level: 187.50 <
Minor level: 184.38
Minor level: 178.13 **
Major level: 175.00
Minor level: 171.88
Minor level: 165.63
Major level: 162.50
Apple closed at 201.55. Apple made a nice push above 200 yesterday. 200 should now offer support.
Watch for support at 200 on a pullback. And there is technical support at 200, so it should be a strong level.
And if Apple can close above 200 for two days, I would expect another 25% on the upside.
WATCH LIST:
Bullish Stocks: AVGO, FLT, ZBRA, MCD, FB, OLED, DECK, CBRL, CASY, BABA, KLAC, XLNX, KEYS, OMC, KMX
Bearish Stocks: DPZ, ALGN, KEX, GDDY, KFY, CAG, CARS, SBH, CXW, TUP, GEO
Be sure to check earnings release dates.
