March 16, 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
Total Premium collected - $1.95

X Long at $14
Total Premium collected - $.89
Short March 18th - $15.50 call @ $.37

ASNA Long at $14.20
Total Premium collected - $.75

ETE Long $14.05
Total Premium collected - $1.05

P Long $13.38
Total Premium collected? - $.35

DUST Long $4.50
Total Premium collected - $.45
Short March 24th - $4.50 call @ $.25

...........................................................................................

Today is the FOMC Meeting and press conference.? As I have been saying, expect a range contraction ahead of the meeting.? And that is what has happened.

Yesterday, the S & P 500 had a 10 point range, selling off to a low of 2,005.23 before heading up and closing at 2,015.93.? You probably recognize that the closing price was 31 cents above the 2,015.62 level.

The S & P has now had three days that have closed above the 2,015.62 level, which tells me to be biased to the longside.? With an objective up to 2,062.50.

Having said that, I would expect excess volatility today based on the Fed announcement.

Just a quick comment on the suggestion to sell calls against the DUST position.? The reason they expire on the 24th and not on Friday, the 25th is because the markets are closed that day for Good Friday.

Yesterday had one of the biggest earnings move I have seen in quite some time.? That was the move on VRX.? VRX dropped $35.55 off their earnings.? It was a drop of 51%.

Here are the key levels for the markets.
?
VIX:

Major level - 25.00
Minor level - 23.44
Minor level - 21.88
Minor level - 20.31
Major level - 18.75
Minor level - 17.19 *
Minor level - 14.06
Major level - 12.50

Look for the higher levels to act as resistance.

Having said that, 15.63 should be a support level and a difficult level to break under.

The 20.13 and 18.75 level should act as resistance.?

S & P 500 Cash Index:?

Major level - 2,062.50
Minor level - 2,046.88
Minor level - 2,015.62 *
Major level - 2,000.00
Minor level - 1,984.38 *
Minor level - 1,953.12
Major level - 1,937.50
Minor level - 1,921.88
Minor level - 1,890.62
Major level - 1,875.00

2,062.50 is still the active objective for the S & P.?

Lower levels should act as support. Namely, 2,000 and 1,984.

Nasd 100 (QQQ):?

Major level - 112.50
Minor level - 111.71
Minor level - 107.03 *
Major level - 106.25 *
Minor level - 105.46
Minor level - 103.91
Major level - 103.13
Minor level - 102.35
Minor level - 100.78
Major level - 100.00

The QQQ closed at 106.63 yesterday.? Just above the 106.25 level.

At this point, the QQQ will need two closes above 107.03 to move up to 112.50.

Lower levels should act as support. 106.25 should be a strong support now.

107.03 should be minor resistance.

TLT:?

Minor level - 132.03
Major level - 131.25
Minor level - 130.46
Minor level - 128.91
Major level - 128.13 *
Minor level - 127.34
Minor level - 125.78
Major level - 125.00

The TLT is around the 128.13 support level.? For the TLT to drop, it will need to move under 126.56.

Two closes under 127.34 and the TLT should drop to 125.? Two closes above 128.91 and it should move up to 131.

GLD:

Major level - 125.00
Major level - 121.88 *
Minor level - 121.10
Minor level - 119.53 *
Major level - 118.75 *
Minor level - 117.96
Minor level - 116.41
Major level - 115.63

118.75 should act as resistance at this point.? 117.19 is a minor support level and a key price level.? If it closes for two days under 117.19, the GLD could drop to 112.

XLE:

Major level - 65.63
Minor level - 64.85
Minor level - 63.28 *
Major level - 62.50
Minor level - 61.72 *
Minor level - 60.16
Major level - 59.38

The next level to the upside is 63.28.? Two closes above 63.28 and the objective becomes 65.63.

Look for lower levels to act as support.? 60.94 is a minor support level, which appears to have held yesterday.

Apple:

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

Apple had a nice pop yesterday and closed at 104.58.? The objective should be to the 106.25 level.

Lower levels should continue to act as support.

Watch list:

Bullish Stocks: ORLY, BCR, TFX, CB, JNJ, PM, MKC, EL, ALGN, D, TJX, FSLR, COR

Bearish Stocks: REGN, AMGN, JACK, ABCO, MD, AR, KFY

Be sure to check earnings release dates.