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
X Long at $14
Total Premium collected - $.89
ASNA Long at $14.20
Total Premium collected - $.75
ETE Long $14.05
Total Premium collected - $1.05
P Long $13.38
Total Premium collected? - $.35
DUST Long $4.50
Total Premium collected - $.45
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Last week ended with the fourth consecutive higher weekly close for all major markets.? This Wednesday is the FOMC Meeting and press conference at 1:30 EST.
The question is will they continue on a course of raising interest rates this year.? This follows the ECB lowering rates last week, so this will be a closely watched press conference.? And needless to say, one that has the potential for excess volatility.
The S & P 500 closed Friday at 2,022.19.? This was the first close above 2,015.62.? So, if the S & P can close above 2,015.62 today, the upside objective becomes 2,062.50.? 2,062.50 is also a level that I feel would be difficult to get through on the first attempt.
There is also upside resistance at 2,031.30, which is very close to the midband on the daily chart, which is 2,035.91.
The VIX should help to confirm a continuation of this move, or a pullback.? Friday, the VIX closed at 16.50, or 69 cents under the 17.19 level.? A close today under 17.19 and the VIX should continue down to 12.50.? 12.50 has been major support on the VIX, so a bounce at that level would not be out of the question.
Here are the key levels for the markets.
?
VIX:
Major level - 25.00
Minor level - 23.44
Minor level - 21.88
Minor level - 20.31
Major level - 18.75
Minor level - 17.19 *
Minor level - 14.06
Major level - 12.50
A close today under 17.19 and the VIX should continue down to 12.50.? However, 15.63 should be a level that offers support and would be tough to break under on the first attempt.
The 18.75 level should act as resistance.? And 17.19 at this point.
S & P 500 Cash Index:?
Major level - 2,062.50
Minor level - 2,046.88
Minor level - 2,015.62 *
Major level - 2,000.00
Minor level - 1,984.38 *
Minor level - 1,953.12
Major level - 1,937.50
Minor level - 1,921.88
Minor level - 1,890.62
Major level - 1,875.00
2,062.50 should be the objective for the S & P if it can close above 2,015.62 today.
Lower levels should act as support. Namely, 2,000 and 1,984.
As the VIX continues to drop, expect the S & P to head higher.? If the VIX does hold support and heads higher, look for a pullback in the markets.
Nasd 100 (QQQ):?
Major level - 112.50
Minor level - 111.71
Minor level - 107.03 *
Major level - 106.25 *
Minor level - 105.46
Minor level - 103.91
Major level - 103.13
Minor level - 102.35
Minor level - 100.78
Major level - 100.00
The QQQ took out the 106.25 level on Friday.? Look for support at 105.46 and 104.
At this point, the QQQ will need two closes above 107.03 to move up to 112.50.
Lower levels should act as support.
Like the S & P 500, the QQQ is approaching the mid band on the daily chart.? That level is 107.41.? Watch how the market reacts at that level. Typically, it will offer resistance.
TLT:?
Minor level - 132.03
Major level - 131.25
Minor level - 130.46
Minor level - 128.91
Major level - 128.13 *
Minor level - 127.34
Minor level - 125.78
Major level - 125.00
The TLT broke under the 128.13 level on Friday and closed at 127.36, just two cents above the minor 127.34 level.?
The TLT will need two closes under 127.34 to move down to 125.
At this point, I would expect a move down to the 122 area.? The TLT has moved into an uptrend on the daily chart and a retest of the highs should be expected.? The question is where should support be. How the TLT reacts around the 122 area will tell us if it drops lower or starts to head back up.
GLD:
Major level - 125.00
Major level - 121.88 *
Minor level - 121.10
Minor level - 119.53 *
Major level - 118.75 *
Minor level - 117.96
Minor level - 116.41
Major level - 115.63
The GLD broke Friday and closed at 119.41.? A close today under 119.53 and it should move down to 118.75.
Just a quick comment on the DUST position.? Friday was the 8th consecutive lower weekly close for DUST.? Also, last week there was volume of 336 million shares.? The volume was about three times the normal volume traded for the week.
If the GLD and the GDX begin to sell off, I would consider adding to the DUST position.
Both the GLD and the GDX have moved into uptrends on their daily charts, but a pullback would not be out of the question.
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
The 62.50 objective was hit again on Friday.? The high for the day was 62.56, before the XLE settled at 62.36.
The next level to the upside is 63.28.? Two closes above 63.28 and the objective becomes 65.63.
Look for lower levels to act as support.
Apple:
Major levels for Apple are 112.50, 106.25, 100, 93.75, and 87.50.
A close today above 101.56 and the objective should be to 106.25.
Watch list:
Bullish Stocks: ORLY, BCR, TFX, CB, JNJ, PM, MKC, EL, ALGN, D, TJX, FSLR, COR
Bearish Stocks: AMGN, JACK, ABCO, MD, AR, KFY
Be sure to check earnings release dates.