January 29, 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 $15.20
Premium Collected - $3.55

AMC Long at $15.27
Premium Collected - $2.25

UNIT Long at $17
Premium Collected - $0.35

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The S & P 500 exploded last week, closing 62.57 points to the upside and a new historic high.

The market closed at 2,872.87. This puts the market within 20 points of the next objective.

In addition, the S & P 500 closed at the high of the weekly bar, which implies that the high of last week will be violated before the low.

And support from last week's weekly price bar, is in the 2,841 area. This means that the S & P 500 could drop 32 points before support could come.

Another fact I would like to share is that the range for the week extended and is consider a long body candle. The weekly average true range was 38.29, compared to a range of 64.75 points. The weekly range extended 169% over the average true range.

When you scale down to a daily chart, you see that for Friday, the S & P 500 extended as well on the daily chart. Friday's range was 26.69 compared to the daily average true range of 19.23.

So, Friday's range was 140% of the daily average true range. And for the day, the market closed at the high of the daily bar as well.

Support from Friday's daily price bar should be in the 2,860 area.

Short term intra day charts remain firmly in uptrends. And price is trading above the upper band on the daily, weekly and monthly charts.

Pre open, the S & P 500 is trading about 7 points to the downside, indicating a lower open. Watch the support levels from daily and weekly price bars.

Short term intra day charts remain bullish for the S & P 500.

Here are the Key Levels for the Markets:

$VIX:

Major level: 14.06
Minor level: 13.67
Minor level: 12.89
Major level: 12.50 <
Minor level: 12.11 **
Minor level: 11.33
Major level: 10.94
Minor level: 10.55
Minor level: 10.16
Major level: 9.38
Minor level: 8.99
Minor level: 8.20
Major level: 7.81

The VIX closed at 11.10. The high for the day was 12.12, again under the 12.50 level, which we expect should continue to act as resistance.

A retest of 12.50 is possible. But, I would still expect resistance at that level.

On the downside, 10.94 could offer support. A break under that level and the VIX should test 9.38.

$SPX:

Major level: 2,890.60 <
Minor level: 2,871.08
Minor level: 2,832.03 **
Major level: 2,812.50
Minor level: 2,792.98
Minor level: 2,753.93
Major level: 2,734.40
Minor level: 2,724.23
Minor level: 2,705.07
Major level: 2,695.30
Minor level: 2,685.55

Friday, the S & P 500 closed at 2,872.87, just above the 2,871.08 minor level.

2,861.30 is a minor support level. And 2,849 should also offer support.

With an anticipated open below 2,865 watch to see if the 2,861 level holds as support.

QQQ:

Major level: 175.00
Minor level: 173.44
Minor level: 170.31 **
Major level: 168.75 <
Minor level: 167.19
Minor level: 164.06
Major level: 162.50
Minor level: 160.94
Minor level: 157.81
Major level: 156.25

The QQQ closed at 170.93. Watch the minor 170.31 level. A close today above that level and the target should be to 175.

169.53 should be minor support.

Like the S & P 500, short term charts are bullish.

IWM:

Major level: 162.50
Minor level: 161.72
Minor level: 160.16 **
Major level: 159.38
Minor level: 158.60 **
Minor level: 157.03
Major level: 156.25
Minor level: 155.47
Minor level: 153.91
Major level: 153.13
Minor level: 152.35

The IWM closed at 159.60, closing exactly on the minor level.

Minor support should be at 158.98. Short term charts are bullish.

TLT:

Major level: 128.13
Minor level: 127.35
Minor level: 125.78
Major level: 125.00
Minor level: 124.61
Minor level: 123.83
Major level: 123.44 <
Minor level: 123.05 **
Minor level: 122.27
Major level: 121.88

The TLT closed at 123.59. Friday's price action was an inside day.

The TLT should open lower. Watch for resistance at 123.44.

GLD:

Major level: 131.25
Minor level: 130.47
Minor level: 128.91
Major level: 128.13 <
Minor level: 127.35 **
Minor level: 125.78
Major level: 125.00
Minor level: 124.22
Minor level: 122.66

The GLD closed at 128.07. The GLD closed back under the upper band, which is 128.57. This is close to the 128.13 resistance level.

An open under 128.13 and this level should be resistance.

To move lower, the GLD will need two closes under 127.35.

XLE:

Major level: 81.25
Minor level: 80.47
Minor level: 78.91
Major level: 78.13 <
Minor level: 77.74 **
Minor level: 76.95
Major level: 76.56
Minor level: 76.17
Minor level: 75.39
Major level: 75.00
Minor level: 74.61

The XLE closed at 77.51. The upper band is 76.57. A close under the upper band and I would expect a pullback.

The XLE is overbought, but the 75 level should offer support.

FXY:

Major level: 89.06
Minor level: 88.87
Minor level: 88.48
Major level: 88.28 <
Minor level: 88.09
Minor level: 87.70
Major level: 87.50
Minor level: 87.31
Minor level: 86.92
Major level: 86.72
Minor level: 86.53

The FXY closed at 88.26, just under the major 88.28 level.

And the FXY should test 88.28, which it did. Two closes above 88.48 and the FXY should test 89.

87.50 should be a major support level. 87.89 is minor support.

AAPL:

Major level: 178.13
Minor level: 177.35
Minor level: 175.78
Major level: 175.00
Minor level: 174.22
Minor level: 172.66
Major level: 171.88
Minor level: 171.10
Minor level: 169.53
Major level: 168.75

Apple closed at 171.51. 170.31 should be minor support.

Short term charts still bullish, so a bounce at the minor 170.31 would not be unexpected.

WATCH LIST:

Bullish Stocks: AMZN, GOOGL, LMT, BA, SPY, GWW, ALGN, ORLY, NLFX, BDX, LLL, FLT, RTN, DE, VRTX, PANW, CME

Bearish Stocks: SLG, ALK, CHD, SAVE, HA, TLK,

Be sure to check earnings release dates.