August 2, 2018 - 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
Total Premium Collected $1.95

ASNA Long at $14.20
Total Premium Collected $0.75

DUST Long $4.50
Total Premium Collected $0.70

SNAP Long at $14.54
Premium Collected - $1.65

BERY Long Sept $50.00 Call at $2.70

FEYE Long at $16.69
FEYE Short August 3rd - $16 Call @ $0.70
Total Premium Collected - $0.95

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Remember that the support level, I mentioned yesterday, from the July monthly bar should continue to act as support for the whole month. It should be in the 2,760 to 2,773 area.

I bring this up because we tend to forget the longer term levels as the market continues to trade.

Yesterday, the S & P 500 closed slightly lower, at 2,813.36. For the day, the market was down 2.93 points.

Pre open, the S & P 500 is trading almost 16 points to the downside. This projects to an open under 2,800.

This would mean the market would be about 25 points above the high end of the monthly support area.

In looking at the resistance levels, the next key level is 2,773.40, which happens to be right on the same support level from the monthly price bar.

I say that 2,773.40 is key because if the S & P 500 has two closes under it, the market could drop to as low as 2,700.

A minor support level is also at 2,797.90, which just happens to be where the projected open is for today.

I suspect if the S & P 50 drops under 2,797.90, it will then test 2,773.40.

Resistance from yesterday's daily price bar is in the 2,815 to 2,817 area.

TSLA reported last night and is trading almost $29 higher after their report.

FEYE reported and is down about $.35. This is why I suggested you sell the front week $16 call and capture the inflated premium. You never can tell what will happen after earnings.

Pre open, the S & P 500 is trading about 13 points lower. Watch the support level from yesterday's daily bar.

Continue to monitor the longer term levels for the market.

Here are the Key Levels for the Markets:

$VIX:

Major level: 31.25
Minor level: 29.69
Minor level: 26.56
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

The VIX closed at 13.28. It closed right on the minor 13.28 level. Look for this level to act as support.

And 12.50 should now be support. Watch the 14.06 level on the upside. Two closes above 14.06 and the VIX should run to 18.75.

SPX:

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
Minor level: 2,780.78
Minor level: 2,756.33
Major level: 2,744.10

2,797.90 should still be support. And I already mentioned the significance of the 2,773.40 level on the downside.

2,822 is minor resistance on the upside. So, if the S & P 500 can clear this level, I would expect it to continue higher.

QQQ:

Major level: 187.50
Minor level: 185.94
Minor level: 182.81
Major level: 181.25
Minor level: 179.69 **
Minor level: 176.56
Major level: 175.00 <
Minor level: 173.44
Minor level: 170.31
Major level: 168.75

The QQQ closed at 177.12. This would imply that if the QQQ can close above 176.56 today, it should test 181.25.

Having said that, the QQQ should open lower this morning. That would mean that 176.56 would become resistance.

173.44 is a minor level on the downside. If the QQQ has two closes under 173.44, I would expect a drop to 168.

IWM:

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 <
Minor level: 164.85
Minor level: 163.28
Major level: 162.50

The IWM closed at 165.76. The IWM, similar to the QQQ, is back above a major level.

Resistance is at 166.41. Support should be at 164.84. Two closes under 164.84 and the IWM should drop to 162.

TLT:

Major level: 123.44
Minor level: 121.49
Minor level: 120.70
Major level: 120.31
Minor level: 119.92
Minor level: 119.14
Major level: 118.75
Minor level: 118.36 **
Minor level: 117.58
Major level: 117.19

The TLT closed at 118.46. Two closes under 118.36 and the TLT should drop to 117.19.

But, to move higher, it will need to recapture the 118.75 level.

119.92 is minor resistance.

GLD:

Major level: 118.75
Minor level: 118.36
Minor level: 117.58
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

The GLD closed at 115.14. To move down to 112.50, the GLD needs two closes under 114.85.

115.63 should now be resistance.

Also, the GLD is right up against its lower band, which is 115.05. A bounce should be coming.

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 76.05. It looks like the XLE is back to testing the 75 level. 75 should be support.

And minor support should be at 76.95. And minor resistance is at 77.73.

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
Minor level: 84.58
Major level: 84.38

The FXY closed at 85.72. A close today above 85.36 and the FXY should move up to 85.94.

The low yesterday was 85.42, just 7 cents above the 85.35 minor support level I mentioned yesterday.

AAPL:

Major level: 200.00
Minor level: 198.44
Minor level: 195.31
Major level: 193.75 <
Minor level: 192.19 **
Minor level: 189.06
Major level: 187.50
Minor level: 186.72
Minor level: 185.16
Major level: 184.38

Apple closed at 201.50, up $11.21 after reporting. Apple is now very close to the upper band on its daily chart, which is $203.40.

$200 should be support. And 198.44 should also offer support.

WATCH LIST:

Bullish Stocks: AMZN, GOOGL, ORLY, SPY, DIA, FLT, COST, AMGN, AET,
CXO, GRUB, EOG, UHS, BDX

Bearish Stocks: TSLA, ITW, WHR, SWKS, NXPI, JACK, LAD, SMG, WDC, SEIC, PZZA, WGO

Be sure to check earnings release dates.