March 2, 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

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
Short March 4th - $4.50 Call @ $.40

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Yesterday ended up with a 'melt up' day.? The market opened on it's low and closed on it's high.

The S & P 500 closed to the upside almost 50 points, with an intra day range of 41 points.

And there really wasn't any major news that could have foretold this action.

The only clue for us the directional indicator using the VIX.? As I said yesterday morning, watch where the VIX opens and where it stalls.

It happened the VIX opened at 19.84, just under the 20.31 resistance level.? It rallied to a high of 20.17 before reversing and headed down.

At that point, the VIX headed south all day.? As along as the VIX continues to drop, you expect the markets to continue up.

The other market I need to mention is the TLT.? I have been saying to expect a sell off. This is because the TLT has been overbought and has made a fast upmove.

Yesterday, it finally broke and was down 2.30 on the day.

I will outline where I feel major support is below.

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

Minor level - 29.68
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

The VIX sold off and closed at 17.70 yesterday.? 17.19 should be a strong level of support.

If it breaks under it on the the first attempt, expect the markets to continue higher.

However, 17.19 is a level to watch closely at the moment.? 18.75 is also a major level.? A close today under 18.75 and the VIX should try and restest 12.50.

S & P 500 Cash Index:?

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
Minor level - 1,859.38
Minor level - 1,828.12
Major level - 1,812.50

A close today above 1,953.12 and it confirms the move up to 2,000.

2,000 is significant because if it is hit on this drive, it could signify this correction is over.

Lower levels should act as support.? Specifically now the 1,953 and 1,937 levels.

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 105.79, just 46 cents under the 106.25 level.

Lower levels should act as support.

TLT:?

Major level - 134.38
Minor level - 133.60
Minor level - 132.03
Major level - 131.25
Minor level - 130.46
Minor level - 128.91
Major level - 128.13 *
Major level - 125.00

The TLT closed at 128.43 yesterday, just 30 cents above the major 128.13 level.? 128.13 should be major support for the TLT.

If it breaks under 128.13, look for a move down to at least 125.

GLD:

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
Minor level - 113.28
Major level - 112.50

The GLD sold off against the 118.75 level yesterday.

Two closes under 117.96 and it should try and hit 115.63.? Still very close to moving into an uptrend on the daily chart.

XLE:

Minor level - 60.16
Major level - 59.38
Minor level - 58.60
Minor level - 57.03 *
Major level - 56.25 *
Minor level - 54.69
Minor level - 53.19
Major level - 53.13

The XLE is back above the 57.03 level.? A close today above that level and the objective should be to 59.38.

Support should be at 56.25.

Apple:

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

Apple did take out the 100 level yesterday.? It had a strong day, up almost 4% on the day.? I expected 100 to act as resistance, which it broke through.

Key level to watch is 103.13.? If it takes out 103.13, look for a move higher.

Watch list:

Bullish Stocks: PNRA, BCR, TWC, TFX, SAFM, FSLR, TJX, EW, COR, GIS, OTEX, CAG

Bearish Stocks: VRX, ALNY, AIG, WDC, RH, ABCO, SCTY, KKR, ARLP, AEL, ALJ

Be sure to check earnings release dates.