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 $0.80
DVA Long November 15th - $57.70 call for $1.80
DVA Long November 15th - $55.00 put for $1.95
DVA Short November 8th - $61.50 call for $0.80
CRM Long November 8th $157.50 call for $1.86
CRM Short November 8th $160.00 call for $0.86
CRM Long November 8th $155 put for $0.85
.........................................................................................
You should have closed out the IRBT put position for an overnight double. The sharp pullback gave us a chance to double our money in one day.
If you are in the DVA position, you no doubt realize that DVA made a strong jump off their earnings. It ended the day closing almost 13% higher for a gain of $8.07.
The original DVA position was structured with a bearish bias and I suggested selling this week's $61.50 call against the long call position.
The idea was to capture the high IV heading into earnings. The earnings pushed the price higher and well above our call strike prices.
I will be looking to close the call positions today, so be aware that an alert will be coming.
This is the risk heading into earnings. You never know how the stock will react.
Back to the markets.
For the day, the S & P closed 2.11 points higher. Wednesday closed out ay 3,076.73.
And yesterday's high was 3,078.34 or slightly above the close. The result was that the S & P closed at 87% of its daily bar.
This now suggests that yesterday's high should be violated before the low.
The resistance level from yesterday's daily bar is in the 3,072 to 3,075 area.
As a point of clarification, I refer to support levels as resistance level. Like a generic term for support or resistance.
The level changes based on where price is trading. For example, if price is above a support level and breaks below it, I now consider that resistance.
And vice versa.
A technical level is created by a chart level. The levels I consider the most important are the 200 ema and the extreme bollinger bands set to a 253 day setting.
Very simply, if price clears the upper band, it tells us it is overbought and a break under the lower band suggests it is oversold.
The midband is also a critical level.
When price is under the lower band and reverses, the objective is band to the midband.
If you use this technical indicator, then you have probably seen this phenomenon happen quite frequently.
I don't know why this occurs and would prefer to let the talking heads speculate as to why it does. I just know it does.
My feeling is that large institutions and high frequency traders must know these levels. I don't know this to be factually accurate, but it does amaze me how many times price does move to the midband. Either from above or from below.
When I mention a technical level in these daily updates, the majority of the time those levels will be the 200 ema or the midband on intraday timeframes.
Pre open, the S & P is trading about 11 points higher. Assuming this holds up to the open, the market should open around 3,087 or slightly above the minor 3,085.95 level.
This would suggest the minor 3,085.95 should be a key level today.
ROKU is trading about $20 lower and EXPE is off about $16 on their earnings.
BIBU is up about $7 off their earnings.
BKNG reports after the close today, along with STMP and DIS.
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
Minor level: 10.16
Major level: 9.38
The VIX closed out at 12.70 yesterday. I mentioned that the 13.28 level should be resistance until the VIX closes above it.
And once again, the 13.28 level offered resistance. The high for the day was 13.39.
After selling off from 13.39, the VIX dropped and rallied and stalled exactly at 13.28.
After hitting 13.28, it dropped to the close. Once again, it is nice to know these levels in advance.
The VIX will still need two closes above 13.28 to move up to 15.63.
Watch the 11.72 level on the downside.
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
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
The S & P closed at 3,076.73. Watch the minor 3,085.95 level today. The S & P will need to clear this level to head higher. So, watch how the market reacts at this level today.
If it clears this level, it would then be support.
3,027.30 should be a support level.
QQQ:
Major level: 203.13
Minor level: 202.35
Minor level: 200.78
Major level: 200.00 Hit
Minor level: 199.22
Minor level: 197.77 **
Major level: 196.88 <
Minor level: 196.10
Minor level: 194.53
Major level: 193.75
Minor level: 192.19
Minor level: 189.06
The QQQ closed at 199.76. The QQQ hit the 200 objective and closed just above it. Watch to see if the QQQ can move above this level.
The next minor level is 200.78. Watch to see if it clears this level and can close above it.
Technical support is around 198. And there is a support line at 198.44.
IWM:
Major level: 162.50 <
Minor level: 160.94
Minor level: 157.81 **
Major level: 156.25 Hit!
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 158.23. The target for the IWM should be to the 162.50.
159.38 is a minor resistance level. The IWM needs to clear this level to move higher. Watch this level today. The IWM got as high as 158.99 before selling off.
And 157.81 which was yesterday's low is a minor support level.
156.25 should still be a support level. And technical support is around 158.
TLT:
Major level: 143.75
Minor level: 142.97
Minor level: 141.41
Major level: 140.63
Minor level: 139.85
Minor level: 138.28
Major level: 137.50 <<
Minor level: 135.84
Minor level: 132.81
Major level: 131.25
The TLT closed at 137.98. There is minor resistance at the 138.28 level. If the TLT clears this level, it should continue higher.
I would not expect the TLT to move above 140.63 on a bounce.
The 141 area should offer technical resistance.
GLD:
Major level: 143.75
Minor level: 142.97
Minor level: 141.41
Major level: 140.63
Minor level: 139.85 **
Minor level: 138.28
Major level: 137.50
Minor level: 136.72
Minor level: 135.16
Major level: 134.38
The GLD closed at 140.45. With the minor 139.85 level holding, it should move higher. It will need to clear 140.63 to head higher.
Technical resistance is around 141.
XLE:
Minor level: 63.28
Major level: 62.50
Minor level: 61.72
Minor level: 60.16 **
Major level: 59.38 < Hit
Minor level: 58.60
Minor level: 57.03
Major level: 56.25
Minor level: 55.86
Minor level: 55.08
Major level: 54.69
The XLE closed at 60.04. At this point, watch the major 59.38 level. If this level cannot hold, I would expect a further pullback.
Once again, the midband offered resistance. As you know, the XLE needs to clear this level to head higher.
Technical support is still around the 59 area. The XLE is selling off from its short term overbought condition.
AAPL:
Major level: 281.25
Minor level: 277.35
Minor level: 269.54
Major level: 265.63 <
Minor level: 261.72
Minor level: 253.91 **
Major level: 250.00
Minor level: 246.88
Minor level: 240.63
Major level: 237.50
Minor level: 234.38
Minor level: 228.13
Major level: 225.00
Apple closed at 257.24. Watch to see if Apple can hold the minor 253.91 level.
If it can, the objective should be up to 265.
The upper band is 257.15. This should now be support until it closes under it.
250 should offer support.
WATCH LIST:
Bullish Stocks: AMZN, AVGO, NTES, MA, ASML, AAPL, ZBRA, PANW, GS, RTB, OLED, FB, V, AGN, HON, DE, DECK, URI
Bearish Stocks: ANET, TWLO, XLNX, CHRW, LOGM, ALB, TAP, FIZZ, CIEN
Be sure to check earnings release dates.
