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
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 $1.06
ET Long at $11.78
Premium Collected $0.35
DBX Long at $19.70
Premium Collected $0.50
AGNC Long at $13.19
AGNC Short March 13th - $13.50 Call @ $0.40
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I did suggest a position yesterday. It was to buy AGNC, a high-yield stock and sell weekly calls against the position. Like most stocks these days, AGNC is oversold and I suggested a small position.
Today is a rather somber St. Patricks Day here in the States. The coronavirus has cancelled the New York City parade, which has been running since March 17, 1762.
But, this is doing even worse for the markets.
For the majority of the day, the S & P 500 managed to hold above the prior pivot low, which was around 2,480.
The low for the day had breached that low, but the S & P was trying to close above it. This would have actually been a bullish sign.
Then around 11:30, more selling hit the markets.
This price level also happened to be right at the midband on the weekly chart.
If the market could hold the midband, it would perhaps help to stem the selling pressure.
As it turned out, the selling took the market down to a low of 2,380.94 or about 132 points below the midband on the weekly chart, which is 2,513.
As you know, this is bearish. But, yesterday's low also put the market well below the lower band on the daily chart.
The lower band is 2,582 and the low ended up about 200 points below it.
As another point of reference, the S & P is also trading under the lower band on the 60 minute chart. That price level is 2,493 and the S & P closed at 2,386.13.
For the market to bounce, it will need to clear the lower band on the 60 minute chart.
These levels tell us how oversold the S & P is.
And now that the midband on the weekly chart is breached, it should be resistance. And it sets up a scenario where it could move to the lower band.
That level is 1,540 and quite frankly is where I ultimately see this market heading.
The major problem is that we are not even getting a normal bear market bounce.
The best the market can do is to close one day higher and then proceed to give those gains and more back.
Yesterday's range ended up at 182.04 points. And the day closed at 3% of the daily bar.
This suggests that the low should be violated.
Resistance from yesterday's daily price bar is in the 2,447 area. Above this price level is resistance around 2,472.
Pre open, the S & P is trading about 19 points higher.
COUP reported last night an is actually trading about $7 higher. FDX reports today after the close.
Here are the Key Levels for the Markets:
$VIX:
Major level: 40.62
Minor level: 39.84 **
Minor level: 38.28
Major level: 37.50
Minor level: 36.72
Minor level: 35.16
Major level: 34.38
Minor level: 33.60
Minor level: 32.03
The VIX closed at 82.69, closing 24.86 points higher on the day. This was a pop of 42.99%.
The VIX is still above the upper band on the daily chart. That level is 38.99.
The upper band on the 60 minute chart is 73.34. And the VIX once again is above this level as well.
For the market to turn up, the VIX will need to move under 73.34. If it can't, expect more selling.
S & P 500:
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
Minor level: 2,929.75
Minor level: 2,851.65
Major level: 2,812.50
Minor level: 2,773.45
Minor level: 2,695.35 **
Major level: 2,656.30 <
Minor level: 2,617.25
Minor level: 2,539.06
Major level: 2,500.00
Minor level: 2,460.95
Minor level: 2,382.85
Major level: 2,304.75
Minor level: 2,226.65
The S & P closed at 2,386.13. At this point, watch the minor 2,382.65 level.
The S & P will need to hold 2,382.65 to see a move higher. If the market can't, look for a move to 2,226.65.
2,493.39 is the lower band on the 60 minute chart. Watch to see if the S & P can hold the lower band. If it can't, expect more selling.
The violation of the lower band tells us that selling is not over.
QQQ:
Minor level: 214.87
Minor level: 213.30
Major level: 212.50
Minor level: 211.72 **
Minor level: 210.16
Major level: 209.38 <
Minor level: 208.60
Minor level: 207.03
Major level: 206.25
Minor level: 205.47
Minor level: 203.91
Major level: 203.13
Minor level: 202.35
Minor level: 202.35
Major level: 200.00
The QQQ closed at 169.30. The QQQ broke under the midband, which is 195.55. This level should now be resistance. The QQQ sold off 11.98%.
This now paves the way for a move to the lower band, which is 156.21.
The lower band on the 60 minute us 177.74 Watch this level today.
175 is a short term technical support level.
IWM:
Major level: 175.00
Minor level: 173.44
Minor level: 170.31
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: 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 103.62. The IWM continues to crash. For the day, the IWM closed 13.27% lower. It is now well below the lower band, which is 132.96.
This puts the IWM about 30% below the extreme price level that should offer support.
The lower band on the 60 minute chart is 111.12. And the IWM is still below this level as well.
Perhaps the poster market for the most oversold. The IWM and the XLE, which is about 36% below its lower band.
TLT:
Major level: 159.38
Minor level: 158.60
Minor level: 157.03 **
Major level: 156.25 <
Minor level: 155.48
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 TLT closed at 163.91. This put the TLT back above the upper band on the daily chart, which is 160.41.
This level should now be support.
172.45 is the upper band on the 60 minute chart and should be resistance.
150 should offer support.
GLD:
Major level: 159.38
Minor level: 158.60
Minor level: 157.03
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: 147.67
Major level: 146.89
Minor level: 146.11
The GLD closed at 141.64. The GLD stopped right at the midband on the daily chart. That level is 136.75 and should be support, until it is violated.
140 should now be technical support. And it is the lower band on the 60 minute chart. Watch the lower band today.
XLE:
Major level: 56.25
Minor level: 55.47
Minor level: 53.90
Major level: 53.12
Minor level: 52.34
Minor level: 50.78
Major level: 50.00
Minor level: 49.22
Minor level: 47.65
Major level: 46.88
Minor level: 46.09 **
Minor level: 44.53
Major level: 43.75 <
The XLE closed at 27.81. This market is still in free fall. The XLE is still well below the lower band on the daily chart. The lower band is now 43.57 and the XLE is about 15 points under it.
27.36 is the lower band on the 60 minute chart. The XLE needs to clear 27.36 to see a move higher.
Unless that happens, stay away.
AAPL:
Major level: 325.00
Minor level: 321.88
Minor level: 315.63
Major level: 312.50
Minor level: 309.38
Minor level: 303.13
Major level: 300.00
Minor level: 296.88 **
Minor level: 290.63
Major level: 287.50 <
Minor level: 284.38
Minor level: 278.13
Major level: 275.00
Minor level: 271.88
Apple closed at 242.83. Apple closed $35.76 lower yesterday.
Apple is still trading above the midband on its daily chart. That level is 234.83 and Apple is still trading above it. This should be support, unless it is violated.
Apple is trading just above the lower band on its 60 minute chart. That level is 245.57 Watch this level today for possible support, assuming a move above it.
WATCH LIST:
Bullish Stocks: MASI, ERY, TNK, LAKE, DHT
Bearish Stocks: AMZN, NFLX, AVGO, ULTA, ALGN, VRSN, MCD, PANW, HON, OLED, MMM, WDAY, CMI, WEX, WIX, PYPL
