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.
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APA Long Oct $47.50 Call at $3.45
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As southeast America braces for the impact of Hurricane Irma, the market managed to bounce yesterday. If you are in the path of the storm, I hope you stay safe.
The market gapped up at the open yesterday about 6 points, which was about the same amount as it gapped down the prior day.
For the day, the S & P 500 closed 7.69 points higher, at 2,465.54.
This puts the S & P 500 back above the upper range of the weekly support area of 2,454 to 2,461.
At this point, I would expect 2,461 to offer support.
As I have been saying, I still expected that 12.50 would offer resistance on the VIX. And a reversal on the VIX at that level or at 13.28, would indicate that the market should continue to bounce.
As it turned out, the high for the VIX on the day was 12.59 before it was turned back to close at 11.63.
Pre open, the S & P 500 is relatively flat, so look for the lower levels to be tested and offer support.
The market getting a push this week is the XLE. Since recouping the major 62.50 level, the XLE has continued to bounce and closed yesterday at 64.97.
For the short term, the key will be to see if the XLE can close above the 65.63 level.
If the XLE can close for two days above this level, I would expect it to continue higher. If it fails at that level, retest of the lows would be the scenario.
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: 12.11 <
Minor level: 11.33 **
Major level: 10.94
The VIX closed at 11.63, under the minor 12.11 level. A close today under 12.11 and the VIX should drop to 10.94.
111.72 is a minor level to watch today.
$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. Minor support is at 2,460.90 and 2,453.10.
2,484.40 is a minor resistance level to the upside. 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 145.13. 144.53 is minor support.
If the QQQ can clear 145.31, look for it to act as support and head higher.
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 139.46. Support should still be at 137.50.
138.28 should also be minor support. And possibly at 139.06.
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 closed at 127.97. The TLT stalled right at 129, just above the minor 128.91 level.
Watch to see if 127.74 holds as 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 126.81. Watch to see if the GLD can clear 127.35. If it can't a test of 125 would be expected.
Minor 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 64.97. The XLE continues with its test of 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.
64.45 is a minor support level. 66.41 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 reversed and closed at 87.91. 87.50 should still offer support. A close today under 88.67 and I would expect 87.50 to be tested.
AAPL:
Major levels for Apple are 165.63, 162.50, 159.38, 156.25, 153.13, and 150.
161.72 is a minor support level. If Apple breaks under this level, a move down to 159.38 is possible.
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.