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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XLNX Long September 20th - $110 call for $4.80
XLNX Short September 20th - $115 call for $2.70
FL Long Sept 13th -35.50 Put @ $0.90
FL Short Sept -13th - $33 Put for $0.30
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The S & P 500 closed 20.19 points lower yesterday. It closed the day out at 2,906.27.
The day opened 20.19 points below Friday's close. The open was 4.31 points below the low from Friday.
After opening at 2,909.01, the S & P dropped 17.16 points to the low of 2,891.85.
From there, the market rallied back 14.42 points to close out at 2,906.27 or within 3 points of the open.
So after appearing that the market would have a major sell off, it basically ended up close to the open.
I also want to point out that yesterday's low of 2,891.85 was essentially the midband on the 30 minute chart, which was 2,940. The low did not stop exactly at the midband, but this is why I say these support or resistance levels should be considered areas.
The 30 minute chart is still bullish while the 60 minute chart is bearish.
Friday's high of 2,940.43 stopped right at the midband on the 60 minute chart and yesterday's low stopped at the midband on the 30 minute chart.
So, at this point, the midband on both timeframes have offered the expected support and resistance.
At this point, the S & P needs to clear the midband on the 60 minute chart, which is 2,937.55 to continue higher.
If it can do that, it would become support. And then the 60 minute chart would move closer to an uptrend. If the 60 minute chart can cross into an uptrend, then I would expect higher highs.
Support from yesterday's daily bar is in the 2,903 to 2,907 area.
Pre open the S & P is trading about 26 points higher. This projects to an open of around 2,932.
Watch for support as well around 2,927.
Here are the Key Levels for the Markets:
$VIX:
Major level: 25.00
Minor level: 24.22
Minor level: 22.66
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
The VIX closed at 19.72 yesterday. This was the first close above 19.53, so a close today above this level implies a move up to 21.88.
But, with the market trading higher pre open, I would expect the VIX to open under 19.53. Assuming it does, it should be resistance.
18.75 should offer support.
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 500 closed at 2,906.27, or just above the minor 2,905.30 level. The next minor level on the upside is 2,929.73.
If the S & P can clear 2,929.73, look for support there. And the market should open just above it.
Minor support should still be at 2,905.
QQQ:
Major level: 196.88
Minor level: 196.10
Minor level: 194.53
Major level: 193.75
Minor level: 192.19
Minor level: 189.06 **
Major level: 187.50 <
Minor level: 185.94
Minor level: 182.81
Major level: 181.25
Minor level: 179.69
The QQQ closed at 185.65. The QQQ closed about 30 cents under the minor 185.94 level.
If the QQQ can clear this level, look for support there.
On the upside, the key level is 187.50. This should be resistance until it is violated.
Like the S & P, the 60 minute chart is bearish and the 30 minute is bullish.
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 146.66. This now implies that if the IWM closes under 148.44, it should drop to 143.75.
Watch to see if the IWM can move above 148.44. If it can, it should be support.
TLT:
Major level: 150.00
Minor level: 148.44
Minor level: 145.31 **
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
The TLT closed at 147.21. The TLT is still above the upper band on the daily chart, which is 146.11.
146.88 is a minor support level. If this holds, the TLT should continue higher.
147.66 is a minor resistance on the upside. If it can clear this level, it should head higher.
GLD:
Major level: 150.00
Minor level: 148.44
Minor level: 145.31 **
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
The GLD closed at 145.75. If the GLD can close above 145.31, it should move up to 150.
The GLD is above the upper band on the daily chart. The upper band is now 144.51.
146.88 is a minor resistance level on the upside.
XLE:
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 <
Minor level: 55.86
Minor level: 55.08
Major level: 54.69
The XLE closed at 57.20. If the XLE can hold the minor 57.03 level, it should head up to 59.38.
56.64 should offer minor support.
AAPL:
Major level: 225.00
Minor level: 221.88
Minor level: 215.63
Major level: 212.50
Minor level: 209.38 **
Minor level: 203.13
Major level: 200.00 <
Minor level: 196.88
Minor level: 190.63
Major level: 187.50
Minor level: 184.38
Apple closed at 205.70. 206.25 should still offer strong support. And minor support should be at 203.13.
The objective for Apple should still be to 212.50.
Ultimately, the target should be to 225.
The 30 minute chart is bullish and support should be around 205. And the 60 minute chart is close to crossing into an uptrend as well.
WATCH LIST:
Bullish Stocks: GOOGL, LMT, FLT, HD, CME, LRCX, AAPL, ADP, ROKU, KLAC, UPS, SBUX, AKAM, DNKN
Bearish Stocks: HUM, DPZ, BIIB, IRBT, BG, GOOS, GDOT, HLF, TDC, JNPR, CROX
Be sure to check earnings release dates.
