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:
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Short June 20th - $15.50 call @ $0.27
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The short $15.50 call on SNAP expired on Friday. I will look to sell another round of calls this week.
I also suggested you close the AMC stock position. Price action was not as expected and I felt it better to close out than hold.
Now, onto the markets.
The S & P 500 is now within 5 points of the 2,968.80 objective we have been looking for.
Friday's high actually came within 4.65 points of this major level.
Pre open, the S & P 500 is trading 4.50 points higher. So, the projected open puts the market to within 15 cents of this key level.
I do believe this market does head higher and of course, clears the 2,968.80 level.
And as I have mentioned on a few occasions, this is the third attempt to clear this price. And you know what they say about the third attempt.
The question becomes, where can the market go after it clears 2,968.80?
There are a couple of price levels I would project assuming we clear 2,968.80.
Naturally, the upper band on the daily chart would be one objective. And that price level is now 3,079.
The other price level I would consider as an upside objective would be the 3,095 resistance level.
And considering that both the resistance level and the upper band are within 20 points of each other, I would consider them strong objectives.
At this point, I would expect support at 2,900.40. And I would not expect the S & P to fall under 2,851 on the lower end.
The other key technical fact at the moment is that the short term 60 minute chart for the S & P 500 is firmly in an uptrend.
With the daily 60 and 30 minute charts all bullish, you expect higher prices to follow.
In fact, a pullback should be considered an opportunity to buy.
Earnings do continue this week. Tomorrow afternoon we will hear from FDX. And Thursday after the close, we get earnings from NKE.
Friday closed at 2,950.46, down 3.72 points for the day. But, Friday also followed a strong bullish day, so a small pullback was not unexpected.
The support level from Friday's daily bar is in the 2,951 to 2,955 area.
The weekly average true range is now 77.79 points. And last week's range came in at 76.85 or almost exactly the average.
As I mentioned Friday, it seemed likely that the range for the week was already in.
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 15.31. For the day, it closed 0.57 points higher.
At this point, 15.63 is still resistance. And if it is cleared, I would not expect it to move higher than 16.41.
13.28 is minor support. The VIX will need to drop under 14.84 to move lower.
12.50 is still the downside objective.
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
Looking for the active objective of 2,968.80 level to be taken out today.
At this point, minor support is at 2,900 and at 2,949. Strong support should be at 2,900.14.
I am still biased for the S & P 500 to clear the major 2,968.80 and if it can, a move up to 3,095 is possible.
Technical support should be at 2,920.
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 188.67. Two closes above the minor 189.06 level and the QQQ should move up to 193.75.
However, it needs to clear the minor 189.84 level first.
Minor support should be at 189. And major support at 187.50.
Like the S & P500, the QQQ did cross into an uptrend on the 60 minute chart.
Technical support should be at 182.
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 153.95. Friday's high came to 155.17. Close enough to say that 156.25 was hit.
The close was back under the midband on the daily chart which now reads 154.80. If the IWM cannot clear the midband in a few days, I would expect it to continue to drop.
153.13 should offer support. And technical support is at 152.
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 131.43. For the day, it was down 1.46 and more importantly, this was the first close under the upper band.
I would expect the TLT to bounce around and test the upper band before breaking or breaking through the upper band again.
At this point, be patient and wait for either event to happen.
Support should be at 131.25.
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 131.11. The GLD continues to trade above the upper band on the daily chart.
That price level is now 130.08.
To move higher, the GLD will need two closes above 132.03.
The GLD is also above the upper band on its 60 minute chart. Short term it is overbought and a pullback should be expected. Don't chase on the longside here.
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 63.56. This now suggests that if the XLE can close above 63.28 today, it should test 65.63.
62.50 should now offer support. And 62.89 should offer minor support.
The 60 minute chart did cross into an uptrend on Friday. Technical support is at 61.80.
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 198.78. If Apple can close above 200, it could move another $50 higher.
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.
Technical support is at 190. The 60 minute chart has crossed into an uptrend. Buy at support.
WATCH LIST:
Bullish Stocks: BA, LMT, SHOP, NOC, ADBE, SPY, NOW, MLM, WDAY, HD, ZBRA, CME, EW, CMI, DATA, V, DE, WIX
Bearish Stocks: ALGN, BLUE, AMTD, FIZZ, TWTR, WES, BGSPRGO, AMTD
Be sure to check earnings release dates.