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.
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Yesterday closed out the month of September with the S & P 500 closing 27.53 points higher.
The month closed out at 3,363.00.
The range for the day was 53.09 points. This was 88% of the daily average true range, which now reads 60.37 points. And the daily price bar closed at only 42% of the range of the daily price bar.
The support area from yesterday's daily price bar is in the 3,352 area. Above this level is the 3,367 area.
Pre open, the S & P is trading about 29 points higher based on the renewed conversation about a stimulus plan.
Assuming this trading holds up until the open, the market should open around yesterday's high. The high was 3,393.56. So, you want to see if the market can take out Wednesday's high.
The September monthly price bar closed 137.31 points lower. And it closed at 40% of the range of the bar.
This does give a slight bias to the low being violated before the high.
The midpoint of the monthly price bar is 3,399. Watch this level today if the S & P follows through after the open.
I also want to point out that the month closed 77 points above the upper band on the monthly chart. The upper band is 3,285 and should be support. So, this should be a key level on a sell-off.
Here are the Key Levels for the Markets:
$VIX:
Minor level: 32.03
Major level: 31.25
Minor level: 30.47
Minor level: 28.91
Major level: 28.13 <
Minor level: 27.35 **
Minor level: 25.78
Major level: 25.00
Minor level: 24.22
Minor level: 22.66
Major level: 21.88
Minor level: 21.10
The VIX closed at 26.37. For the day, the VIX closed .10 points higher. The VIX is still sitting right on the midband on the daily chart. The midband is 26.31.
I am still looking for higher levels to be resistance. Watch the 27.35 level. And the VIX reverses lower at this level, look for a drop and the market to bounce.
Also, watch the 26.31 level today.
The VIX and the S & P did diverge yesterday, with both closing higher.
S & P 500:
Major level: 3,593.60
Minor level: 3,554.55
Minor level: 3,476.45
Major level: 3,437.40 <
Minor level: 3,398.35
Minor level: 3,320.25 **
Major level: 3,281.20 <
Minor level: 3,242.15
Minor level: 3,164.00
Major level: 3,125.00
Minor level: 3,085.95
Minor level: 3,007.85
Major level: 2,968.80
The S & P closed at 3,363.00. Watch the minor 3,398.35 level today. I would expect it to be tested.
The objective should be up to 3,437.40, but the S & P needs to clear 3,398.35.
The 60 minute chart for the S & P is still bearish and is trading under the midband. That level should be the objective, which is 3,388. The S & P should open above the midband, which would suggest it would support on a pullback.
Technical support is around 3,355.
QQQ:
Minor level: 289.06
Major level: 287.50
Minor level: 285.94
Minor level: 282.81
Major level: 281.25
Minor level: 279.69
Minor level: 276.56 **
Major level: 275.00
Minor level: 273.44
Minor level: 270.31
Major level: 268.75
Minor level: 267.19
Minor level: 264.06
Major level: 262.50
Minor level: 260.94
Minor level: 257.81
Major level: 256.25
The QQQ closed at 277.84. The QQQ closed 1.89 higher.
With a close today above 276.56, the QQQ should test 281.25.
The QQQ did clear the midband on the 60 minute chart. That price level is now 278 and should be support.
IWM:
Major level: 162.50
Minor level: 160.94
Minor level: 157.81
Major level: 156.25
Minor level: 154.70
Minor level: 151.56
Major level: 150.00 <
Minor level: 148.44
Minor level: 145.31
Major level: 143.75
Minor level: 142.19
Minor level: 139.06
Major level: 137.50
Minor level: 135.94
The IWM closed at 149.79. The IWM closed .45 higher on the day.
This put the IWM back under the major 150 level and above the midband on the daily chart.
The midband is now 145.95 and should now be support. And support should be at the 148.44 level as well.
And the midband on the 60 minute chart is 153. Technical support should be around 148.
TLT:
Major level: 171.88
Minor level: 171.10
Minor level: 169.53
Major level: 168.75
Minor level: 167.97
Minor level: 166.41
Major level: 165.63
Minor level: 164.85 **
Minor level: 163.28
Major level: 162.50 <
Minor level: 161.72
Minor level: 160.16
Major level: 159.38
The TLT closed at 163.09. It closed 1.59 lower.
To move higher, the TLT needs to recoup the 164.85 level. If not, a drop to 162.50 would be expected. And with a close today under 164.85, the TLT should drop to 162.50. Same as yesterday, only that the TLT is now within one cent of the 164.85 level.
The 164 area is now technical resistance. This is the key area at the moment.
GLD:
Minor level: 188.28
Major level: 187.50
Minor level: 186.72
Minor level: 185.16
Major level: 184.38
Minor level: 183.60
Minor level: 182.03
Major level: 181.25
Minor level: 180.47
Minor level: 178.91 **
Major level: 175.00 < HIT!
Minor level: 174.25
Minor level: 172.70
Major level: 171.89
The GLD closed at 171.12. The GLD closed 1.07 lower on the day.
The GLD needs to clear the 171.89 level. If it can, it should be support.
The GLD is pushing up from the lower band on the 60 minute chart. Look for a move up to the midband, which is 182.
Getting the oversold bounce we expected.
XLE:
Minor level: 41.41
Major level: 40.63
Minor level: 39.83
Minor level: 38.28
Major level: 37.50
Minor level: 36.72
Minor level: 35.15
Major level: 34.37
Minor level: 33.59
Minor level: 32.03 **
Major level: 31.25 <
Minor level: 30.47 **
Minor level: 28.90
Major level: 28.12
The XLE closed at 29.95. The XLE closed .09 lower. Getting the oversold bounce.
Target should be down to the 28.12 level.
Short term charts remain bearish. And the lower band on the 60 minute chart is 27.75.
AAPL:
Minor level: 140.63
Major level: 137.50
Minor level: 134.38
Minor level: 128.13
Major level: 125.00
Minor level: 121.88
Minor level: 115.63 **
Major level: 112.50 <
Minor level: 109.13
Minor level: 103.13
Major level: 100.00
Apple closed at 115.81. Apple managed to close $1.72. higher.
A close today above 115.63 and Apple should head up to 125.
Apple broke under the midband on the 60 minute chart. That level is 117 and should be resistance. Apple has crossed into a downtrend on the 60 minute chart. Short term momentum is bearish. Watch the midband.
The lower band is 99 and that should be support now.
WATCH LIST:
Bullish Stocks: ZM, FDX, ROKU, NKE, GH, Z, CNI, DG, AAXN, NTRA, RUN, TWTR, VSLR, TOL,
Bearish Stocks: LMT, BIIB, FLT, CME, CI, BA, IBM, CB, CBRL, ROST, YUM, BAX, EW, HAS, WYNN