May 11, 2017 - 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.

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COWN - Long at $14.95

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The S & P 500, once again, continues to trade in a narrow range.? For the day it closed 2.71 points to the upside.? And had a range of only 6.95 points ?

The ATR is now 13.11 points, so the range for the day contracted again.? And was about 1/2 the ATR.

In addition to the contraction, the S & P 500 formed an inside day.? This is a day that has a lower high and a higher low.

And often is preceded by a range expansion.? And with the recent series of narrow range days, we know that an expansion will be coming.? We just don't when or which direction.

The S & P 500 seems to be struggling to get through the 2,400 level. The last four days have had the daily high just above or below the 2,400 price.? ?

The question is when will it punch through and hit our target of 2,406.30?

With the market set to open slightly lower, look for lower levels to offer support for the move up to the objective.

?As I mentioned the past few days, support from last week's weekly price bar should be in the 2,390 to 2,394 area.

Yesterday's low came in at 2,392.79, which puts it right in the middle of the support zone from last week's weekly price bar.

This area should continue to offer support until it is violated to the downside.

Yesterday I tried to convey how to read the levels for the S & P 500, which of course, is a bullish market.

Yesterday, I mentioned the FXY and how it dropped down three levels to the 84.38 level.? And I mentioned how if you were short you could tighten up a stop.? The reason being that one of two events would occur.

Either the FXY would bounce off the level or it would break down further.

As it turned out, the FXY closed to the downside.? It closed at 84.25, or just under the major 84.38 level.

A stop above 84.65 would lock in profits if you had shorted at the major 89.06 level.

The next minor level to the downside is 83.60.? You would want to see if the FXY can close under this level for it to continue down to 82.81.

Here are the Key Levels for the Markets:

$VIX:

Minor level: 14.45
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:? 9.77
Major level:? 9.38 Strong support

The VIX closed slightly to the up.side, at 9.96.? The low for the day was 9.56, just 18 cents above the major 9.38 level.

Close enough to say it was hit.? A violation of 9.38 would inside the VIX should head lower.

Downside support should be at 8.98.? 10.16 should be resistance.

$SPX:

Major level: 2,406.30 <
Minor level: 2,398.48 **
Minor level: 2,382.82
Major level: 2,375.00
Minor level: 2,367.20
Minor level: 2,351.60
Major level: 2,343.80
Minor level: 2,335.98

Objective is still to 2,406.30.? Sounds familiar doesn't it?

2,394.50 and 2,398.40 should offer support now.

On the upside, 2,402.30 is a minor resistance level.

QQQ: ?

Major level: 140.63
Minor level: 139.85
Minor level: 138.28 **
Major level: 137.50 <
Minor level: 136.72
Minor level: 135.16
Major level: 134.38
Minor level: 133.60

The QQQ closed for a second day over 138.28.? The objective should be up to 140.63.

138.67 is a minor resistance level.? Yesterday's low was 137.91, just two cents above the 137.89 level, that I mentioned? should be support.

138.09 should be minor support.

IWM:

Minor level: 141.41
Major level: 140.63
Minor level: 139.85
Minor level: 138.28 ***
Major level: 137.50 <
Minor level: 136.72
Minor level: 135.16
Major level: 134.38

The IWM had a strong day, falling just short of the 140.63 objective I mentioned yesterday.? The high for the day was 139.48.

138.67 should offer support. 139.45 could offer minor resistance.

TLT: ?

Major level: 125.00
Minor level: 124.22
Minor level: 122.66
Major level: 121.88
Minor level: 121.09 **
Minor level: 119.53
Major level: 118.75 <
Minor level: 117.96 ?

The objective should still be down to 118.75.? The TLT rose to within 3 cents of the 121.09 minor resistance level before selling off.

The 60 minute chart has moved into a downtrend.

120.21 should be minor support and 120.70 resistance.

GLD: ?

Minor level: 122.66
Major level: 121.88
Minor level: 120.32
Minor level: 119.53
Major level: 118.75
Minor level: 117.97
Minor level: 116.41 **
Major level: 115.63 <
Minor level: 114.85 **
Minor level: 113.28
Major level: 112.50

Both the short term 30 minute and 60 minute charts are in downtrends.? Any rally should be short lived.

To move higher, the GLD would need two closes above 116.41.? The next level on the downside is 114.85.

115.23 should be minor support.? 116.60 should be minor resistance.

XLE:

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 is almost back to the 68.75 level. It hit a high of 68.44.

67.77 is a minor support level.? 68.36 should be minor resistance.

FXY:

Major level: 87.50
Minor level: 87.11
Minor level: 86.33
Major level: 85.94 ?
Minor level: 85.55
Minor level: 84.77
Major level: 84.38 <
Minor level: 83.60 **
Minor level: 83.20
Major level: 82.81

84.57 should be minor resistance.? And 83.98 should be minor support.

Watch to see if the FXY can close under 83.60.

AAPL:

Major levels for Apple are 162.50, 156.25, 150, 143.75, and 137.50

The next objective is to 156.25.? 150.00 should be major support.? And 153.13 should be minor support.

159.38 could offer resistance.? Trend is bullish, but a bit overbought short term.

WATCH LIST:

Bullish Stocks: PCLN, GOOGL, REGN, NOC, HUM, MMM, GD, AET, ALGN, ADBE, RCL, SWKS, KLAC, CBOE, CCL, CTSH, SSYS, BBRY

Bearish Stocks: FLT, SJM, ATHN, THS, DVA, TCO, OXY, CLR, EDR, BSFT

Be sure to check earnings release dates.