August 10, 2016 – 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
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ASNA Long at $14.20
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ETE Long $14.05
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P Long $13.38
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DUST Long $4.50
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FCX Long $12.45
Short August 12th-$13 Call – $.24

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The S & P 500 hit the objective we have been calling for.? Yesterday’s high was 2,187.66, so it exceeded our target by 2.16.

Even though this run appears weak and is characterized by narrow range days, the objectives tell you that it is not time to short the markets. That is until there is a bona fide reversal at or around a resistance level.

The key now is to see if the S & P 500 can close above 2,187.50, and more importantly the 2,203.12 level.

As I have been saying, the 2,187.50 level is a price level where, if the market failed, the drop could be quick.

But, at this point the market has moved three levels off the Brexit bottom on June 27th.

This is important because it indicates that the bull trend is still intact and it sets up scenarios that tell us how far a pullback should go.? Or I say, should not go.

Here is what I mean.

If the market were to pullback off the 2,187.50 level, I would expect a pullback to go no farther than 2,062.50. And it could be possible it would stop at 2,125.

Any drop further than 2,062.50 and the uptrend could be questioned.

On today’s webinar, I will share an unsolicited email I received from a member who traded off the price levels.? You may find it interesting.

Hope to see you on today’s webinar.

Here are the key levels for the markets.

VIX:

Minor level – 17.96
Major level – 15.63
Minor level – 14.85
Minor level – 13.28 *
Major level – 12.50 *
Minor level – 11.72 *
Minor level – 10.15
Major level – 9.38

The VIX closed at 11.66.? It was up .16 on the day. This is a divergence, as both the VIX & the S & P 500 closed to the upside.

The objective should still be down to 9.39, so expect higher levels to offer resistance.

12.11 should be minor resistance.

S & P 500 Cash Index:?

Major level – 2,250.00
Minor level – 2,234.38
Minor level – 2,203.12 *
Major level – 2,187.50 **
Minor level – 2,171.88 *
Minor level – 2,140.62
Major level – 2,125.00
Minor level – 2,109.38
Minor level – 2,078.12
Major level – 2,062.50

2,187.50 objective hit.?

Minor support is at 2,171.90.?

The next upside confirming level is 2,203.12. I would expect resistance at that level.

Nasd 100 (QQQ):?

Major level – 121.88
Minor level – 120.31
Minor level – 117.19
Major level – 118.75 *
Minor level – 117.97
Minor level – 116.41
Major level – 115.63
Minor level – 114.85
Minor level – 113.28
Major level – 112.50

115.63 should be strong support.? Minor support is at 116.60.

Minor resistance is at 117.19.

Trend remains bullish.

TLT:?

Major level – 143.75
Minor level – 142.96
Minor level – 141.41
Major level – 140.63
Minor level – 139.85
Minor level – 138.28 *
Major level – 137.50
Minor level – 136.72
Major level – 134.38

The TLT closed at 139.62, so if it closes today above 138.28, it should try and test the 140.63 level.

139.06 should be support.

GLD:

Major level – 131.25 **
Minor level – 130.46
Minor level – 128.91 *
Major level – 128.13 *
Minor level – 127.35
Minor level – 125.78
Major level – 125.00
Minor level – 124.22

Yesterday’s high was one penny above the major 128.13 level.

127.34 is a support level on the downside.

XLE:

Major level – 71.88
Minor level – 71.10
Minor level – 69.53
Major level – 68.75
Minor level – 67.96
Minor level – 66.41 *
Major level – 65.63 *
Minor level – 64.85
Minor level – 63.28
Major level – 62.50

The XLE stalled against the 68.75 level.

Short term charts are firming up. If the XLE can clear 68.75 and the intra day charts move into uptrends, the XLE should move up to the 75 level.

Apple:

Major levels for Apple are 112.50, 106.25, 100, 93.75, and 87.50.

The objective should be to 112.50.? 106.25 should be support.

Continue to look to buy against support.

Watch list:

Bullish Stocks: PCLN, AMZN, ULTA, AVGO, RTN, ZBH, FFIV, CMI, FB, SWK, MON, JACK, CME, JACK, ALGN

Bearish Stocks:? ATHN, SRCL, WDC, HIG, CF, VGR, FLO
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Be sure to check earnings release dates.