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
SNAP Long at $14.54
Total Premium Collected - $2.37
Short June 20th - $15.50 call @ $0.27
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
AMC Long at $16.16
Total Premium Collected $0.35
.........................................................................................
The S & P 500 closed slightly to the upside yesterday. But, we expected a contraction after the large move on Tuesday.
For the day, the market closed 8.71 points higher. The S & P 500 closed at 2,926.46.
The key is that the S & P 500 closed above 2,910.15 for the second consecutive day.
And the low for the day was 2,911.43, just about a point above the minor support level. In fact, I wrote this yesterday: "The minor 2,910.15 level should offer support on the downside."
When price clears the major level and then manages to close above the next minor level, it usually acts as support.
With yesterday's close, this puts the next objective for the S & P 500 squarely to the major 2,968.80 level.
And yesterday's high was 2,931.74 which is only 37 points from that target.
And pre open, the S & P 500 is trading about 24 points higher, so we should be within 13 points of this level right at the open.
Will we clear the 2,931.74 level on the third attempt?
One thing for sure, is that I would not want to bet against it.
The question we need to ask is what should happen if we get through 2,968.80?
Well, for starters, I would expect more movement to the upside. In fact, clearing 2,968.80 would be a strong indication that the markets should go higher.
How high could it go?
I believe it could go to around 3,100. And the upper band on the daily chart is 3,075, so this would not be unrealistic.
Assuming the market ultimately hits the upper band, it will mean that price will have run from the bottom band to the top band.
In other words, the band pattern worked to perfection.
Support from yesterday's daily price bar is in the 2,923 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
The VIX closed yesterday at 14.30. The VIX finally broke under the major 15.63 level. And it broke under the minor 14.85 level as well.
This now suggests that if the VIX can close under 14.85 today, it should drop to 12.50.
Of course, we would expect resistance at 14.85. And at 15.63.
But with the market down significantly pre open, we would expect the VIX to drop right off the open.
Watch for possible support at 13.28.
SPX:
Major level: 2,968.80 <
Minor level: 2,949.25
Minor level: 2,910.15 **
Major level: 2,890.60
Minor level: 2,871.08
Minor level: 2,832.03
Major level: 2,812.50
Minor level: 2,792.98
Minor level: 2,753.93
Major level: 2,734.40
Minor level: 2,714.88
Minor level: 2,675.83
Major level: 2,656.30
The active objective is now to the major 2,968.80 level. We had expected a run to 2,910.15 and we got it.
With a projected open about 27 points higher, the S & P 500 should open around 2,953 or about 15 points under the target.
Obviously, watch this level on the upside. And the minor 2,954.10 level.
On the downside, look for support at 2,929.70.
The 60 minute chart has crossed into an uptrend, which does suggest we will see higher prices.
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
Minor level: 173.44
Minor level: 170.31
Major level: 168.75
Minor level: 167.19
The QQQ closed at 187.11. The QQQ should open about 2.62 points higher. This would put the QQQ around 190.
Two closes above the minor 189.06 level and the QQQ should move up to 193.75.
Look for the QQQ to continue higher if it takes out 190.63.
The QQQ has not crossed into an uptrend on its 60 minute chart, but I would expect it today.
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 154.56. Still biased for a move up to 156.25. And the IWM got to within 55 cents of it.
The IWM is literally sitting right at the midband on the daily chart.
The midband now reads 154.89. With the bullish bias before the open, I would expect the IWM to take out the midband.
Look for support there if it does.
154.69 is a minor level and should hold as support on a pullback.
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 132.54. The objective should be up to 134.38.
The TLT continues to trade above the upper band, which is 131.99.
The TLT is overbought but wait for a strong close under the upper band before shorting.
131.64 is minor support and yesterday's low was 131.58. Minor support is at 132.03 as well.
GLD:
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 127.89. The GLD came to within 14 cents of the major 128.13 level.
126.56 should offer support. A move to 131 is expected.
Technical support should be at 127.
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
Minor level: 55.47
Minor level: 53.91
Major level: 53.91
The XLE closed at 62.30. The XLE will need to close above 62.50 to move higher. And the XLE should open above 62.50 this morning. This would suggest that it would be support.
On the downside, 59.38 is the key level. Two closes under this level and the XLE could drop to 50.
63.28 is a minor resistance level on the upside. If the XLE clears this level, look for it to continue higher.
The 60 minute chart is close to moving into an uptrend.
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 197.87. Apple did hit 200 as expected. The high for the day was 200.29.
196.88 should be minor support.
200 is a key level for Apple. If it does take out 200, it should move up to 250. Apple should open just above 200. Look for support there.
WATCH LIST:
Bullish Stocks: CMG, ORLY, ANTM, MCD, LIN, ACN, DECK, CB, KMB, DG, RACE, PYPL, YUM, ALL, ROKU, WING
Bearish Stocks: NFLX, DPZ, AGN, CXO, UTHR, NTAP, FIZZ, PRGO, AMTD
Be sure to check earnings release dates.
