May 30, 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.

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

DYN Long at $12.55
Premium Collected $0.48

COWN - Long at $14.95

DIS Long July $105 Call @ $3.60

VRX Long at $13.69
..........................................................................................

Before I begin today, I just want to mention that both short call positions expired last Friday, thereby allowing you to book the profits on those positions. I will be looking to add another round of calls on VRX this week, if we can get a decent premium, especially with a short week.

After the quick drop, and the spike in the VIX, the markets all recovered to move up to new highs. Actually, the DOW did not make a new high, but it is close.

Again, it just goes to show that holding long VIX position can quickly evaporate.

The S & P 500 ended up closing at 2,415.82.? It closed to the upside 34.09 points.

I do believe this is significant for two reasons.

The first is that the S & P 500 closed above the 2,406.30 level for two days.

For the longer term view of the market, this means that the major objective becomes 2,500.

And the second fact is that the S & P 500 had two closes above 2,414.10, which puts the shorter term objective to 2,437.50.

As I have said in prior updates, I do believe that 2,437.50 could be a difficult level to get through on the first attempt.

I would not be surprised to see some consolidation around that level.

However, if the S & P 500 does break through 2,437.50 on the first shot, EXPECT the market to go higher.

Very simply, because the S & P 500 continues to achieve its upside objectives it tells you that shorting is still a very risky endeavor.

Shorting should only be considered by experienced traders and profits should be taken on short term oversold conditions.

This week is a short week, with the markets closed yesterday for the Memorial Day Holiday here in the States.

The big marketwide news release this week will be the Non Farm Payroll on Friday at 8:30 AM EST.

Earnings continue this week.? PANW reports tomorrow after the close.

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

The VIX closed at 9.81, just 43 cents above the 9.38 level.

The 9.38 level is a major level for the VIX.? And it has never been taken out. This does make me concerned that a top is looming.

Look for 9.77 to hold as support.

$SPX:

Major level: 2,437.50
Minor level: 2,429.70
Minor level: 2,414.10 <
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

2,437.50 should be the objective. And 2,406 should be support. If the S & P 500 breaks under 2406, I would expect 2,398 to offer support.

QQQ: ?

Major level: 143.75
Minor level: 142.97
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 QQQ closed out last week at 141.22. To move up to 143.75, it will need two closes above 141.41.

142.97 should be minor resistance.? 140.63 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
Minor level: 133.60

The IWM closed out last week at 137.54.

135.94 should be support.? And 139.06 could be 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 TLT should test 125.

I do expect resistance at 125.? Clearing 125 would tell us the TLT should head considerably higher.

Daily trend remains bearish.

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

121.88 should be the objective. ?

120.31 should now be minor support.? 122.66 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 continues to trade between 68.75 and 65.63.? Quite boring at the moment and a market to avoid until it either breaks out or breaks down.

Waiting to see which way the XLE breaks.

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

A close today above 86.33 and the FXY should test 87.50.? 87.50 should be strong resistance.

86.33 could be minor support. And 86.91 should be minor resistance.

AAPL:

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

Apple closed out at 153.61 last week.? This is just above the 153.13 level, which should be support.

Objective is to 162. ?

Apple announced a massive $210 Billion buyback on May 2nd.

WATCH LIST:

Bullish Stocks: AMZN, GOOGL, MELI, LMT, AVGO, DPZ, GD, MMM, BIDU, BA, NVDA, ADBE, HON, CB, BABA, ACN, MA

Bearish Stocks: AZO, ORLY, UHS, CLB, DLTR, MNRO, SIG, FLR, EAT, NLSN, BBBY

Be sure to check earnings release dates.