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
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ASNA Long at $14.20
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DUST Long $4.50
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BERY Long Sept $50.00 Call at $2.70
FEYE Long at $16.69
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The S & P 500 dropped to a low of 2,885.13, after opening 4.56 points lower than Friday. The drop from Friday's close to yesterday's low was
16.39 points.
With the short term charts in uptrends, we were looking for support to come in at some point. The question is always where should support or resistance be?
As it turns out, the low for the day was within one point of the minor 2,894.30 support level I mentioned yesterday.
Both the 30 minute and 60 minute charts remain bullish, but as I have said, the support levels are still quite far from the current market price.
The closest short term moving average is the 200 ema on the 30 minute chart, which is 2,876.25. The point is that the market could drop another 20 points without affecting the bull trend. Yesterday's close was 2,896.72, so the S & P is still well above the technical support levels.
The next technical support level would be the midband on the 30 minute chart, which is 2,865.
The technical support levels are quite close to the support levels from the August monthly price bar, which is in the 2,856 to 2,861 area. A pullback down to this area would be a great area to consider a long position.
Earnings do continue this week, though the number of companies are slowing down.
One final comment is this. Expect to have the August stockbacks posted within the next few days. I suggest you do download the list as these stocks do tend to perform well after they begin buying back stock.
Pre open, the S & P 500 is trading about 8 points lower. This would put the projected open around 2,892, which is right around out minor resistance level of 2,902.83.
Watch to see if the market can regain the minor 2,902.83 level. If it can't, it should head lower.
Resistance from yesterday's daily price bar is in the 2,892 to 2,896 area.
Here are the Key Levels for the Markets:
$VIX:
Major level: 25.00
Minor level: 23.44
Minor level: 20.31
Major level: 18.75 <
Minor level: 17.19
Minor level: 14.06 **
Major level: 12.50 <
Minor level: 10.94
Minor level: 7.81
Major level: 6.25
The VIX managed to close higher for the day, at 13.16. However, it did trade higher on the day, getting as high as 14.35, before dropping to close at 13.16.
Even with these recent upmoves in the VIX, it still has not managed to close above 14.06. This level should continue to act as resistance.
Minor resistance is now at 13.67. And 12.50 should be support.
SPX:
Major level: 2,939.50
Minor level: 2,927.28
Minor level: 2,902.83 **
Major level: 2,890.60 <
Minor level: 2,878.40
Minor level: 2,854.00
Major level: 2,841.80
Minor level: 2,829.60
Minor level: 2,805.20
Major level: 2,793.00
The S & P 500 should open right around the minor 2,890.60 level. Watch to see if the market can hold this level. If it can, it should try and test the minor 2,902.83 level.
If it fails at 2,890.60, a drop to 2,878.40 is possible.
Short term intra day 30 and 60 minute charts are still bullish. Technical support is around 2,865.
QQQ:
Major level: 193.75
Minor level: 192.19
Minor level: 189.06 **
Major level: 187.50 Hit!
Minor level: 185.94
Minor level: 182.81
Major level: 181.25
Minor level: 179.69
Minor level: 176.56
Major level: 175.00
The QQQ closed at 185.85. This was the first close under 185.94. A close today under 185.94 and the QQQ should test 181.25.
Watch to see if the QQQ can reclaim the minor 185.94 level.
Minor support is at 184.38. 189.06 is minor resistance.
IWM:
Major level: 175.00 <
Minor level:174.22
Minor level: 172.66 **
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
The IWM closed at 172.25. With a close under 172.66, the IWM will still need two closes above 172.66 to move higher.
At this point, support should be at 171.88 and 171.48. 174.22 could offer resistance.
TLT:
Major level: 123.44
Minor level: 123.05
Minor level: 122.27
Major level: 121.88
Minor level: 121.10 <
Minor level: 119.53
Major level: 118.75
Minor level: 118.36
Minor level: 117.58
Major level: 117.19
The TLT closed at 120.03. With a close under 121.10, this now sets up a situation where if the TLT can close under that level today, it could test 118.75.
The TLT did break under the midband on the daily chart, which is now 120.44.
For a reversal to the upside to happen, the TLT needs to reclaim the midband and close above 121.10.
Minor support should be at 119.92.
Both short term 30 and 60 minute charts remain bullish. I am biased for a bounce here.
GLD:
Major level: 117.19
Minor level: 116.80
Minor level: 116.02
Major level: 115.63
Minor level: 114.85 **
Minor level: 113.28
Major level: 112.50 <
Minor level: 111.72
Minor level: 110.16
Major level: 109.38
The GLD is almost back to the 112.50 level, which we were looking for. It closed yesterday at 112.93. The low for the day came within 11 cents of the target.
The GLD is heading back to test the lower band, which is now 111.62.
111.72 is a minor support. 113.28 is minor resistance.
XLE:
Major level: 78.13
Minor level: 77.35
Minor level: 75.78 **
Major level: 75.00
Minor level: 74.22
Minor level: 72.66
Major level: 71.88
Minor level: 71.10
Minor level: 69.53
Major level: 68.75
The XLE closed at 74.28. The XLE will need two closes above 75.78 to move up to 78.13. And two closes under 74.22 to move lower.
The XLE is trying to figure out which way to move. It remains stalled between the 75 and 74.22 levels.
Minor support should now be at 73.83 and 74.22. And minor resistance is at 75.39.
The 30 minute chart has crossed into an uptrend. Short term momentum is shifting to the upside.
FXY:
Major level: 86.72 <
Minor level: 86.53
Minor level: 86.14 **
Major level: 85.94
Minor level: 85.75
Minor level: 85.36
Major level: 85.16
Minor level: 84.97
The FXY closed at 85.79. The FXY will still need two closes above 86.14 to move higher. To move lower, it will need two closes under 85.75.
85.55 should offer support. And resistance is at 86.04.
Technical resistance is at 85.98, so it the FXY can clear this level, it should bounce.
AAPL:
Major level: 237.50
Minor level: 234.38
Minor level: 228.13 ***
Major level: 225.00 <
Minor level: 221.88
Minor level: 215.63
Major level: 212.50
Minor level: 209.38
Apple closed at 228.36. If Apple can close above 228.13 today, it should move up to 237.50.
Minor support is at 226.56. And 229.69 could offer some resistance.
Short term charts remain firmly bullish. Buy oversold conditions.
WATCH LIST:
Bullish Stocks: AMZN, ALGN, ILMN, DPZ, ADBE, BDX, DIA, COST, PANW, AAPL, MA, AET, AMGN, CME, WDAY, ADSK, CRM, GRUB
Bearish Stocks: TSLA, LRCX, EXP, SWKS, SPR, LRCX, CPA, RGLD, KHC, AN, HAL, NTRI, JD, OSTK, TECK,
Be sure to check earnings release dates.