March 12, 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
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AMC Long at $15.27
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Short March $16 call @ $0.55

UNIT Long at $17.00
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VIPS Long @ $17.19
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Short March 16th - $17.00 call @ $1.15
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Friday, the S & P 500 gapped to the upside again at the open. Unlike Thursday, the market followed through with a strong bullish day.

For the day, the S & P 500 closed to the upside 47.60 points. It closed at 2,786.57. This is back above the minor 2,753.93. A close today above 2,753.93 and the upside objective becomes 2,812.50.

Actually, the market is within 26 points of the next major level. And the market is above the upside level of 2,753.93 by 33 points.

Support from Friday's daily price bar should be around 2,770.

Of course, the VIX complied with the upmove by continuing to drop. Since topping out at 50.30 on February 6th, the VIX closed Friday at 14.64. This once again demonstrates that when the VIX moves well above the upper band on the daily chart, it will return to under the upper band.

For the week, the S & P 500 closed to the upside 95.32 points. The range for the week was 110.82. With a weekly average true range of 70.48, the range for the week was almost 160% of the average true range.

This certainly is an expansion and shows strength. Having said that, the upper band on the weekly chart is 2,815.66, which is just above the next upside resistance level.

If the S & P 500 can clear the upper band again, the market should continue higher. Watch to see how the market reacts at the upper band.

Pre open, the S & P 500 is trading about 6 points to the upside. This would put the open around 2,792. 2,773 should offer strong support if the market does pullback.

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 ended up closing at 14.64. Based on a close under 17.19, I would expect a retest of 12.50. 17.19 should offer resistance.

The VIX crossed into a downtrend on the 60 minute, so I do expect more movement to the downside. This would imply further upside in the markets.

15.63 should also offer resistance.

$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: 2,714.88
Minor level: 2,675.83
Major level: 2,656.30

The S & P 500 ended the day closing at 2,786.57. The 2,734.40 level should continue to be support.

And a close today above 2,753 would indicate the next objective should be 2,812.50.

Watch the 2,793 level today. If the S & P 500 can clear this level today, it should offer 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 173.16. A close today above 170.31 and the QQQ should test 175.

171.88 should be minor support and major support should be at 168.75. The 60 minute chart just crossed into an uptrend, which implies further movement to the upside.

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

The IWM closed at 158.92. Objective should be to 159.38. And the IWM is within 38 cents of that objective.

158.60 should offer minor support. If the IWM can clear 159.38, I do expect a move up to 162.50.

TLT:

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
Minor level: 116.80
Minor level: 116.02
Major level: 115.63

The TLT closed at 117.91. The TLT continues to bounce around oversold territory.
To move lower, the TLT will need two closes under 117.58. To move higher, it will need two closes above 119.14.

At this point, the TLT is bouncing between the 118.75 and 117.19 levels. It is oversold and I do expect a bounce, but it should bounce around before the next move is established.

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 125.54. The GLD would still need two closes above 125.78 to test 128.13.

The next level on the downside after 125, is 124.22. A break under 124.22 and the GLD should drop
to 121.88.

The GLD is at a major level. It will either break out or break down. Still holding the 125 level. the GLD is trying to hold the major 125 level. Wait for the next minor move to develop.

XLE:

Minor level: 76.95
Major level: 76.56
Minor level: 76.17
Minor level: 75.39
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 <
Minor level: 67.97
Minor level: 66.41 **
Major level: 65.63

The XLE closed at 68.45. The XLE continues to trade around the midband on the daily chart. The midband is now 67.17 and the XLE is starting to move up and away from it. It should offer support.

If the XLE can clear 68.75, it should head up to the 75 area.

FXY:

Major level: 91.41
Minor level: 91.22
Minor level: 90.83 **
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

The FXY closed at 89.74. It broke and sold off after closing under the upper band.

89.84 is minor resistance. Look for higher highs to be resistance. And resistance at the upper band, which is 90.39.

AAPL:

Major level: 181.25
Minor level: 180.47
Minor level: 178.91 <
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

Apple closed at 179.98, closing to the upside 3.04. 178.13 is a minor support level.

Continue to buy against support. Still the best strategy.

WATCH LIST:

Bullish Stocks: AMZN, NFLX, GWW, GS, BIDU, AVGO, BLUE, STZ, DPZ, GD, LRCX, ADBE, PANW, AAPL, VRTX, CME, WEX, RHT, ADSK, CRM, SINA, KLAC, GRUB, VRSK, HLF

Bearish Stocks: DTE, BG, CNI, OMC, AIG, NWE, SIG, HOG, SLCA, NS

Be sure to check earnings release dates.