March 7, 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

AMC Long at $15.27
Premium Collected - $2.80
Short March $16 call @ $0.55

UNIT Long at $17.00
Premium Collected - $0.35

VIPS Long @ $17.19
Premium Collected - $2.80
Short March 16th - $17.00 call @ $1.15
..........................................................................................

Yesterday, you should have rolled out the short call position on VIPS to the March 16th - $17.00 call. This now means you have collected $2.80 per share on the VIPS position.

The market inched slightly higher yesterday, closing 7.18 points. The S & P 500 closed at 2,728.12. The range for the day was only 20.82 points.

The average true range is 44.22. So, yesterday's range was about one half the average true range. And this was after a series of range expansions.

Add to the fact that yesterday's daily price bar formed a doji. This indecision for the market.

Yesterday's high was 2,732.08, which was 2.32 points under the major 2,734.40 level.

The midband on the 10 minute chart is now 2,723 and yesterday's close was just above it, at 2,728.12.

Pre open, the S & P 500 is trading about 16 points to the downside.

This would estimate today's open around 2,712, or below the midband on the short term 10 minute chart.

Based on this projected open, I would expect resistance at the midband. And resistance around 2,728, which was yesterday's close.

On the downside, 2,701 should be a support level.

Watch the VIX to time reversals up or down. For the market to head up, the VIX will need to move lower. And if the VIX continues higher, expect the market to continue lower.

2,695 is also a key resistance level to watch.

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 18.36. The VIX dropped to under the 18.75 level. I still expect resistance at 20.31. But, if the VIX can close above 20.31 for two days, look for a move up to 25.

On the downside, the key level is 17.19. Two closes under 17.19 and the VIX should drop to 12.50.

$SPX:

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
Minor level: 2,636.75
Minor level: 2,597.65
Major level: 2,578.10

Watch for support around the 2,695 level. If this level cannot hold, the market should continue lower.

On the downside, if the 2,714.88 level is also a key level. Two closes under this level and the S & P 500 should drop to 2,656.30.

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 168.54. The high yesterday was 169.11. The high for the day hit the 168.75 objective.

A break under 167.19 and it should be resistance. And two closes under 167.19 and the QQQ should drop to 162.50.

IWM:

Minor level: 157.03
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 155.37. A close today above 153.91 and the IWM should test 156.25.

The 153.13 level should still be support.

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 118.14. The TLT continues to bounce around oversold territory.
To move lower, the TLT will need two closes under 117.58.

Minor resistance is at 118.75. I don't expect a drop under 115.63, but if the TLT does, fall under this level, it should head lower.

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 126.53. With a move above 125.78, this now implies that if the GLD can close above 125.78, the GLD should 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.

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 67.70. At this point, the XLE should test 68.75.

And the XLE closed above the midband on the daily chart, which is 67.19. This level should now offer support.

Also, the 65.63 level should offer support.

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 90.29, dropping 2 cents. It is still trading above the upper band on the daily chart, which is 90.22.

A close under this level would set up a short. However, I would expect the FXY to bounce around before a change in trend.

89.84 should now be support. Same as yesterday.

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 176.67. Apple did hit the 178.13 objective we were looking for.

175 should still offer support. With the 30 and 60 minute charts in uptrends, buying oversold conditions off the shorter term charts should be the strategy. The 171 area should offer support.

WATCH LIST:

Bullish Stocks: MELI, NFLX, BLUE, PANW, RHT, WDAY, DNB, WDAY, MON, CRM, KLAC, MKC, GRUB, LULU, DIN, AKAM, AKAM, MSCC, AMAT, X

Bearish Stocks: CHTR, ADX, MLM, WHR, AGN, ZBH, EXPE, DLR, ALB, MDT, RBC, CVS, IRBT, KHC

Be sure to check earnings release dates.