January 5, 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
Short Jan 12- $15.50 Call @ $0.31
Premium Collected - $3.55

AMC Long at $15.27
Short January $16 Call @ $0.27
Premium Collected - $2.25

UNIT Long at $17
Short January $17.50 Call @ $0.35

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At 8:30 EST, we will get the Non Farm Payroll figures. The market is trading to the upside before the release of the data.

The S & P 500 closed for for a second day above 2,705.07. It closed at 2,723.99.

The active objective now becomes 2,734.40.

Yesterday's high was 2,729.29, which is only 5.11 points from the objective.

As I write this update, the S & P 500 is trading almost 8 points to the upside. Based on an open about 8 points higher, the S & P 500 should take out the objective.

Of course, this is before the Non Farm Payroll.

Taking out 2,734.40 would be a strongly bullish event and indicate the market should head higher.

And yesterday, the DOW closed above 25,000 for the first time in history.

This market continues to defy all logic. This is why it is important to follow the price levels. And with 2,734.40 being violated, it paves the way for a move up to 2,812.

Support from yesterday's daily price bar is in the 2,721 to 2,724 area.

The only bearish scenario is that yesterday both the S & P 500 and the VIX closed to the upside.

Continue to follow the resistance levels.

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 close at 9.27. The low for the day was 8.92. The level is 8.99. Two closes under 8.99 and the VIX should test 7.81.

The VIX could not reclaim 9.38 and I would still expect higher levels to offer resistance.

$SPX:

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 **
Minor level: 2,666.05
Major level: 2,656.30 <
Minor level: 2,646.53
Minor level: 2,626.98
Major level: 2,617.20
Minor level: 2,607.43

The S & P 500 closed at 2,723.99. This was the second day closing above 2,705.07, which puts the objective at 2,734.

Support should be at 2,722.20. And minor support now at 2,716.10.

QQQ:

Major level: 162.50
Minor level: 160.94
Minor level: 157.81 **
Major level: 156.25
Minor level: 155.47
Minor level: 153.91
Major level: 153.13
Minor level: 152.34
Minor level: 150.78
Major level: 150.00

The QQQ closed at 160.31. The objective for the QQQ should be the 162.50 level.

I feel that the ultimate objective for the QQQ is 175.

159.38 should be minor support.

IWM:

Major level: 156.25
Minor level: 155.47
Minor level: 153.91
Major level: 153.13 <
Minor level: 152.35 **
Minor level: 150.78
Major level: 150.00
Minor level: 149.22
Minor level: 147.66
Major level: 146.88

The IWM closed at 154.47. The objective should still be to 156.25.

154.30 should offer support. And 153.52 should also be minor support.

TLT:

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: 124.61
Minor level: 123.83
Major level: 123.44
Minor level: 123.05

The TLT closed at 126.07. The TLT should test 128.13 again.

And minor resistance is at 126.95. And minor support is at 125.39.

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: 121.10
Minor level: 119.53
Major level: 118.75
Minor level: 117.96

The GLD closed at 125.46. The GLD did manage to close back above 125.

I am biased for resistance at 125. The GLD is overbought. If ti does take out 126.56, it should head higher.

GLD is at an interesting price level. A straddle could make sense now. either the GLD will fail and head back to test 115 or continue up to test of 137.

XLE:

Major level: 76.56
Minor level: 76.17
Minor level: 75.39
Major level: 75.00 <
Minor level: 74.61
Minor level: 73.83
Major level: 73.44
Minor level: 72.66
Minor level: 71.09
Major level: 70.31
Minor level: 69.92

The XLE closed exactly on our objective, which was 75.

The next minor level to the upside is 75.39. Watch to see if the XLE can clear this level.

The XLE closed above the upper band on the daily chart. The upper band is 74.87. This sets up a few bullish scenarios.

The 200 ema did cross above the 253 day average on the daily chart. the 200 ema is 67.19 and the 253 day average is 67.04.

These levels should offer support on a pullback.

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: 84.96
Minor level: 84.55
Major level: 84.38

The FXY closed at 85.13. The FXY failed to close above 85.36.

Watch to see if it can hold 85.16. If it can't I would expect a drop back to 84.38. Same as yesterday.

AAPL:

Major levels for Apple are 175, 171.88, 168.75, 165.63, 162.50, and 159.38.

Apple close at 173.03.

The next minor level to the upside is 172.66. Two closes above 172.66 and Apple should head back to 175. A close today above 172.66 and Apple should test 175.

WATCH LIST:

Bullish Stocks: LMT, NOC, GD, LLL, FLT, HD, CMI, SWK, CAT, DE, VRTX, UTX, FANG, CRI, VLO, PFE

Bearish Stocks: JACK, DISH, ABM, AGO, JBL, IMAX, WMGI, SSYS

Be sure to check earnings release dates.