August 10, 2015 - MDT Pro Tips A.M.

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
Premium collected - $1.25

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The Non Farm Payroll on Friday ended up being a non reaction.

The S & P moved down about 15 points before settling and moving up about 10 points.

Not the type of reaction I would have expected.

Perhaps everyone feels a September rate hike is a done deal.

Everyone except the TLT that is.? The TLT popped 1.61 on Friday and is just .66 shy of the 125 objective.

Once again, the VIX can help to pinpoint intra day moves.? Friday, it opened at 13.57 and proceeded to move up.? That was your clue the markets should drop.

The open was about a point above the key 12.50 level.

From there it ran up to 14.58 and stalled right at the top band on a short term 10 minute chart.

As it sold off, the market turned and headed up.

This happened around 1:00 EST.

I bring this up because the SPY bottomed at 206.87 and ended up closing at 207.95.

A move of over $1.

What makes this type of move at that time exciting to me is that you can buy cheap options that expire the same day and harness tremendous leverage.

The S & P 500 formed an inside bar last week.? This will usually mean that a breakout or a breakdown should precede a larger move.

The S& P has an average range of just over 45 points.
So if volatility increases this week, there could be some big moves.? Especially with slow summer trading.

Here are the key levels for the markets.

Stocks...
?
VIX: ?

Major level - 17.19
Major level - 15.63
Minor level - 14.45
Major level - 14.06 *
Minor level - 13.67
Minor level - 12.89
Major level - 12.50
Minor level - 12.11
Major level - 10.94

The 14.06 objective was hit Friday, with the VIX hitting a high of 14.58 before settling at 13.39.

A close today under 13.67 would mean the objective for the VIX is back to 12.50.

S & P 500 Cash Index: ?

Minor level - 2,132.82
Major level - 2,125.00
Major level - 2,109.40
Major level - 2,093.80
Minor level - 2,089.90
Minor level - 2,082.00
Major level - 2,078.10
Minor level - 2,074.20
Major level - 2,062.50

The S & P bottomed Friday at 2,067.91 before closing at 2,077.57, just .63 under the major 2,078.10 level.

The key levels are 2,082 on the upside and 2,074.20 on the downside.

Nasd 100 (QQQ): ?

Major level - 115.63
Minor level - 113.28
Major level - 112.50
Minor level - 112.11
Minor level - 111.33
Major level - 110.94
Minor level - 110.16
Major level - 109.38

Friday's low was 109.40,? just 2 cents above the objective I mentioned Friday.

A close today above 110.16 and the objective becomes 110.94.

TLT: ?

Minor level - 125.78
Major level - 125
Minor level - 124.22
Minor level - 122.66 ?
Major level - 121.88
Minor level - 119.53 ?
Major level - 118.75
Major level - 115.63

125 should still be the objective.? I would expect some resistance at 125.78.

Support should be at 124.22.

GLD:

Major level - 109.38
Minor level - 107.03
Major level - 106.25
Minor level - 105.46
Minor level - 103.91
Major level - 103.13
Minor level - 102.34
Major level - 100

The GLD continues to trade between 106 and 103.

XLE:

Major level -? 75 ?
Minor level - 74.21
Minor level - 72.66
Major level - 71.88
Minor level - 71.09
Major level - 68.75
Minor level - 67.96
Major level - 65.63
Major level - 62.50

Major support should be around 62.50.
If the XLE can hold the 65.63 level, I would expect a fast upmove.

Wait for it to set up.

Apple:

Major levels for Apple are 125, 118.75 and 112.50.

The $119 area would be a place to think about getting
short on Apple.? If it gets through that price, I don't think
it gets through $125.? At least not on this drive.

Apple should try and make a run up to the 119 area.

Watch list:
Bullish Stocks:? PCLN, REGN, MLM, VRTX, PANW, BWLD, NFLX, EXPE, KMB, CLX, HON, RAI, ALK

Bearish Stocks: IBM, CMI, DDS, SLB, CVX, Z, CAT, Z, DECK, XLE, FOSL,QCOM, GMCR

Be sure to check earnings release dates.