May 8, 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

SNAP Long at $14.54
Premium Collected - $1.65

TEVA Long $18.06
Premium collected - $1.10

KMI Long September $16 call @ $1.00

ADTN Long August $15 Call @ $.75
ADTN Short August $17 Call @ $.35

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You should have sold the UNIT position yesterday booking the profit on the trade. Most likely, if you received the alert you actually sold the stock for more than what I stated in the alert. This is what can happen when you sell into strength.

The S & P 500 opened yesterday at 2,669.36 and ended up closing the day at 2,672.63. The range for the day was only 18.65 points. With an average true range of 37.77 points, the market contracted to about 50% of the average.

Also, the market made a higher high yesterday, when it hit 2,683.35. This was about 13 points higher than Friday's high.

So, at this point, the market fulfilled the obligation it was looking for, namely a violation of the high from last week.

But yesterday, the market formed a doji bar, which means indecision. And with the contraction, we expect an expansion. The expansion may not happen today, but it will happen.

The key areas from yesterday's daily price are the close, which was 2,672.63 and 2,671.

Pre open, the S & P 500 is trading about 7 points to the downside. This would suggest that the daily numbers above would offer resistance on a rally.

The weekly price support levels should still have validity. Based on the weekly price bar, support should be in the 2,638 area. If that level does not hold, look for support at 2,629.

Finally, the 60 minute chart for the S & P 500 has crossed into an uptrend. This suggests to expect a rally once price finds support. And with price above the midband on the 60 minute chart, I would expect support at that level. That level is 2,659.76.

Earnings continue this week. Thursday, we will hear from NVIDIA.

Continue to monitor the longer term levels for the market.

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 closed at 14.72. The objective remains down to 12.50.

The high for the day was 15.52, just 11 cents under the minor 15.63 resistance level.

Short term charts remain bearish so expect the VIX to reverse lower if the VIX does rally.

Look for minor resistance at 15.63 and 17.19.

$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
Minor level: 2,558.58

The S & P 500 closed at 2,672.63, just under the minor 2,675 level. It will now need two closes above 2,675.83 to move higher. I do expect strong support at 2,656.30.

On the upside, I would expect minor resistance at 2,685.50.

Minor support should be at 2,661.10.

QQQ:

Major level: 175.00
Minor level: 171.88
Minor level: 165.63 **
Major level: 162.50 <
Minor level: 159.38
Minor level: 153.13
Major level: 150.00
Minor level: 146.88
Minor level: 140.63
Major level: 137.50

The QQQ closed at 164.87. 162.50 should offer major support at this point.

And Minor support is at 164.06. If this level holds, I would expect a move up to 168.75.

IWM:

Major level: 159.38
Minor level: 158.60
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

The IWM closed at 157.05. A close today above 157.03 implies a move up to 159.38.

Look for support at 156.25. Also, the 154 area should provide support.

TLT:

Minor level: 121.49
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 118.80, just above the 118.75 support level. Watch to see if this level holds. If it can't, look for the TLT to drop.

Watch to see if the TLT reclaims the 119.14 level. If it can, look for it to head higher.

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: 124.61 **
Minor level: 123.83
Major level: 123.44 <

The GLD closed at 124.57. The GLD will still need two closes above 125.78 to move higher.

The high yesterday was within 43 cents of the 125 level. This is level should still offer resistance.

But, if the GLD can clear 125, it should head higher.

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

The XLE closed at 73.95. The XLE took out the 75 level, with a high yesterday of 75.57.

At this point, the key level is 74.22. A close today below 74.22 and the XLE could drop to 71.88.

73.44 should offer support.

FXY:

Minor level: 89.26
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
Major level: 86.72

The FXY closed at 87.85. The objective should be to 88.28.

87.70 should offer short term support.

AAPL:

Major level: 187.50
Minor level: 185.94
Minor level: 182.81 **
Major level: 181.25
Minor level: 179.69
Minor level: 176.56
Major level: 175.00
Minor level: 173.44
Minor level: 170.31
Major level: 168.75
Minor level: 167.19

Apple closed at 185.16. Apple hit the 187.50 objective, with a high of 187.67.

Apple has run four levels at this point, so a pullback could happen. If it does, I would expect strong support at 175.

WATCH LIST:

Bullish Stocks: AMZN, BIDU, PANW, WYNN, MA, RHT, RACE, VMW, KEX, DXCM, LVS, OXY, HFC, DNKN

Bearish Stocks: TSLA, REGN, NTES, AVGO, CMI, ATHN, LOGM, WDC, BG, LUV, MDP, BERY, CLVS, WAGE

Be sure to check earnings release dates.