October 18, 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

APA Long Oct $47.50 Call at $3.45

SNAP Long at $15.20
SNAP Short Oct 20th - $16.00 Call at $0.65
Premium Collected - $1.20

AMC Long at $15.27
AMC Short Oct $16 Call at $0.43

THC Long at $14.63
THC Short Oct $15 call at $0.40

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The market continues to inch up. Yesterday closed at 2,559.36, up 1.72 on the day. The high was 2,559.71. And the low was 2,554.69.

The range for the day was only 5.02 points. And the average true range keeps falling as well. It now reads 9.67 points.

These contractions make me concerned. Concerned that a pullback is on the way.

But, we still have an objective about 20 points higher than where we are trading now. The question will be what happens after we hit the 2,578.10 level?

I will lay out what I see after we hit the objective. But breaking through 2,578.10 would create a scenario where we should go higher.

Support from yesterday's daily bar should be in the 2,557 area. And the weekly support area of 2,549 to 2,552 should still be valid.

I do need to point out that yesterday was the second consecutive day where both the S & P 500 and the VIX closed to the upside.

The last time this happened was on October 3rd and 4th. The following day, the S & P 500 closed 14.33 points to the upside. Should the same pattern follow today, it would put the market within 6 points of our objective.

Pre open the market is up slightly over 4 points. Look for the daily and weekly support levels to hold if tested.

IBM reported last night and is trading about 6.5% to the upside.

Continue to follow the resistance levels.

Here are the Key Levels for the Markets:

$VIX:

Major level: 15.63
Minor level: 14.85
Minor level: 13.28
Major level: 12.50
Minor level: 11.72
Minor level: 10.16
Major level: 9.38 <
Minor level: 8.99 **
Minor level: 8.20
Major level: 7.81

The VIX closed at 10.31. The 10.16 level should be key today because a close above it would indicate the VIX could go to 12.50.

If the VIX opens under 10.16, look for it to be resistance. Also, 10.35 could offer resistance.

9.96 could offer support.

$SPX:

Major level: 2,578.10 <
Minor level: 2,558.60
Minor level: 2,548.85 **
Major level: 2,539.10 <
Minor level: 2,529.33
Minor level: 2,509.78
Major level: 2,500.00
Minor level: 2,492.20
Minor level: 2,476.00
Major level: 2,468.80

The objective is still to 2,578. 2,557.10 is a minor support level.

And 2,555.50 should also be a minor support level.

2,561.00 could offer resistance. Short term momentum remains bullish.

QQQ:

Major level: 150.00
Minor level: 148.44
Minor level: 145.31 ***
Major level: 143.75 <
Minor level: 142.18 ***
Minor level: 139.06
Major level: 137.50 5
Minor level: 135.94
Minor level: 132.81

The QQQ closed at 149.04. The QQQ continues to move up to the 150 objective. Yesterday's high was within 1.00 points of the 150 objective.

The minor support is at 148.63. 149.61 could offer minor resistance. Short term momentum remains bullish.

IWM:

Minor level: 150.78 **
Major level: 150.00 <
Minor level: 149.22 **
Minor level: 147.66
Major level: 146.88
Minor level: 145.32
Minor level: 144.53
Major level: 143.75
Minor level: 142.97

The IWM closed at 148.81. To move lower, the IWM would need two closes under 149.22. And yesterday's close was the first close under 149.22. A close today under 149.22 implies a move down to 146.88.

150.39 could offer minor resistance and 148.44 is minor support.

TLT:

Major level: 131.25
Major 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 TLT closed at 125.92. And yesterday was the first close above 125.78. A close today above that level implies a move up to 128.13.

126.37 is minor resistance and 125.59 is minor support.

GLD:

Minor level: 125.78
Major level: 125.00
Minor level: 124.22
Minor level: 122.66 <
Major level: 121.88
Minor level: 121.10
Minor level: 119.53
Major level: 118.75

The GLD closed at 122.13. The GLD did retest the 121.88 level. The low for the day was 121.73.

The next minor level is 121.48 A break under this levels implies a move lower.

XLE:

Major level: 71.89
Minor level: 71.11
Minor level: 69.54
Major level: 68.75 **
Minor level: 67.97
Minor level: 66.41
Major level: 65.63
Minor level: 64.85
Minor level: 63.28
Major level: 62.50

The XLE closed at 68.33. The XLE continues to hold above the midband on the daily chart. The midband is 67.74. To move higher, the XLE will need to close above 68.75.

68.26 should be minor support. 68.65 could offer resistance.

FXY:

Major level: 89.06
Minor level: 88.67
Minor level: 87.89
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 <

The FXY closed at 85.61. To move lower, the FXY will need two closes under 85.55.

85.45 should offer minor support. 85.74 should offer minor resistance.

AAPL:

Major levels for Apple are 165.63, 162.50, 159.38, 156.25, 153.13, and 150.

Apple closed at 160.47, closing up .59 on the day. 162.50 should be the objective.

160.94 should also be a resistance level. And 158.38 is minor support.

WATCH LIST:

Bullish Stocks: GOOGL, AMZN, BIIB, LMT, BIDU, BA, FDX, MMM, ALGN, RTN, FB, ASML, PANW, MA, URI, JNJ, CAT, RHT, CHKP, UTX, ADSK, V, KLAC

Bearish Stocks: ULTA, DIS, AAP, RL, KHC, WBA, TSCO, DXCM, GE, AOBC, CCJ, BBBY

Be sure to check earnings release dates.