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
Total Premium Collected $1.95
ASNA Long at $14.20
Total Premium Collected $0.75
DUST Long $4.50
Total Premium Collected $0.70
DYN Long at $12.55
Premium Collected $0.48
APA Long Oct $47.50 Call at $3.45
..........................................................................................
The week started off with the S & P 500 opening below the close of Friday's doji bar and proceeding to sell off the majority of the day.
For the day, the S & P 500 closed down 18.70 points, at 2,457.86.
The range for the day however, was 25.42. This was due to the bearish gap open. The open was 6.20 points lower than Friday's close.
I mentioned yesterday that the support area from last week's weekly price bar was in the 2,454 to 2,461 area.
The low for the day breached the lower end of that support area by about 7 points.
By the end of the day, the S & P rallied back to close at 2,457.86, which just happens to be the midpoint of the weekly support area. The actual midpoint is 2,457.50, so the close was within 35 cents of it.
Based on the formation of last week's weekly price bar, it sets ups a scenario where the high of the bar should be violated before the low.
The other indicator to help us with market direction is the VIX. I mentioned that I still feel that 12.50 should be resistance. The VIX of course, jumped and ran to a high of 14.06, which just happens to be a minor resistance level before selling off to back under 12.50.
12.50 and 14.06 should continue to act as resistance and if the VIX should sell off against one of these levels, I would expect it to continue down and the market to head up.
The market appears set to open slightly to the upside this morning. A retest of yesterday's low would not be out the question, but I would be looking for the VIX to fail as an opportunity to go long.
Continue to follow the resistance levels.
Here are the Key Levels for the Markets:
$VIX:
Major level: 18.75
Minor level: 17.97
Minor level: 16.41
Major level: 15.63
Minor level: 14.84
Minor level: 13.28
Major level: 12.50
Minor level: 11.72
Minor level: 10.16 **
Major level: 9.38 <
The VIX closed at 12.23, jumping 20.73%. I still expect resistance at 14.06 and 12.50.
10.94 could now offer support.
$SPX:
Major level: 2,500.00
Minor level: 2,484.38
Minor level: 2,453.12 ***
Major level: 2,437.50 <
Minor level: 2,421.88
Minor level: 2,390.62
Major level: 2,375.00
Minor level: 2,359.38
Minor level: 2,328.12
Major level: 2,312.50
The objective should still be to 2,500. 2,453.12 should still be support.
And 2,445.30 should offer minor support.
2,476.60 is a minor resistance level to the upside. This is where the market reversed Friday. The market will need to clear it to head higher.
QQQ:
Major level: 150.00
Minor level: 148.44
Minor level: 145.31 ***
Major level: 143.75 <
Minor level: 142.18
Minor level: 139.06
Major level: 137.50
Minor level: 135.94
Minor level: 132.81
The QQQ closed at 144.69. The low for the day was 143.60, just 15 cents under the 143.75 support level.
The minor level to watch is 144.92. A close today under that level and the QQQ should retest 143.75.
IWM:
Minor level: 144.53
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: 135.15
Major level: 134.37
The IWM closed at 139.17. Support should still be at 137.50.
138.28 should also be minor support.
TLT:
Major level: 129.69
Minor level: 128.91
Minor level: 126.57
Major level: 128.13
Minor level: 127.74 <
Minor level: 126.95
Major level: 126.56 <
Minor level: 126.17
Minor level: 125.39
Major level: 125.00
The TLT broke out and closed at 128.76. 129.69 could offer minor resistance, but it the TLT clears this level, expect a move up to 131.
128.13 should offer strong support.
GLD:
Major level: 128.13
Minor level: 127.35
Minor level: 125.78 **
Major level: 125.00 <
Minor level: 124.22 **
Minor level: 122.66
Major level: 121.88
Minor level: 120.32
Minor level: 119.53
Major level: 118.75
Minor level: 117.97
The GLD closed at 127.46. The GLD should test 128 and came within 22 cents of it.
The 131.25 level should be difficult to get through on the first attempt.
Support is at 125.78.
XLE:
Minor level: 67.97
Minor level: 66.41
Major level: 65.63
Minor level: 64.85
Minor level: 63.28
Major level: 62.50 <<
Minor level: 61.72 **
Minor level: 60.16
Major level: 59.38
The XLE closed at 63.93. The XLE should now test 65.63.
65.63 is a key level. It needs to clear 65.63 to head higher. A failure at that level and it should head considerably lower.
63.67 is a minor support level. 64.45 could offer resistance.
FXY:
Major level: 89.06
Minor level: 88.67
Minor level: 87.89
Major level: 87.50 <
Minor level: 87.11 **
Minor level: 86.33
Major level: 85.94
Minor level: 85.55
Minor level: 84.77
Major level: 84.38
The FXY gapped up and closed at 88.38. The major level on the upside is 89.06. I would expect resistance at that level, but if the FXY can clear 89.06 on this drive, expect it to head higher.
The 87.30 area should offer support.
AAPL:
Major levels for Apple are 165.63, 162.50, 159.38, 156.25, 153.13, and 150.
Apple closed at 162.08, above the 162.50 level. The objective should be to 165.63.
I would not expect Apple to drop below 159.38.
WATCH LIST:
Bullish Stocks: BIIB, HUM, ILMN, CI, WAT, RTN, LRCX, AAPL, VRTX, MCD, ASML, ADBE, BLUE, RCL, KMB, EA, CAT, ADSK, WDAY, RHT
Bearish Stocks: OMC, REG, PB, ALSK, BIG, APC, SAVE, EAT, GCO
Be sure to check earnings release dates.
