October 3, 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

PANW Long Oct $145 Call at $2.44

..........................................................................................

The markets continue their historic run with the S & P 500 closing 9.76 points to the upside, at 2,529.12. Last Thursday and Friday both closed above 2,509.78, so the active objective should be to 2,539.10.

And yesterday's high was within 10 points of the objective.

The VIX continues to hover around the historic low of 9.38. Yesterday's low was 9.37, only one cent under the major 9.38 level.

The question now is this. Does the 9.38 level on the VIX get taken out?

History says no. But, I don't think we have ever seen a bull run like this, so the VIX breaking under 9.38 maybe possible.

At least we know and are aware of the significance of the 9.38 level.

For the VIX to drop to the next level under 9.38, which is 7.81, it will need two closes under 8.99. And I do feel if the VIX breaks under 7.81, it could drop to as low as 6.30.

And because the VIX is under the major 10.94 level, the higher levels should continue to act as resistance.

This should tell us that a major move down in the markets is unlikely and that after any pullback, a rally should ensue.

The market that appears to have put in a major bottom is the XLE. This would be especially true if the XLE could close above the 68.75 level.

The major resistance level for oil is the $55.56 price level on light crude oil or the WTIC. We will look at this chart on tomorrow's webinar.

Support from yesterday's daily price bar should be in the 2,525 area.

Friday at 8:30 AM EST we will get the non farm payroll.

Pre open, the market is trading to the upside about 2.00 points, so watch the support areas I mentioned above.

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 9.45. The low for the day was 9.37. The VIX is trying to hold the major 9.38 level.

As you know, the 9.38 level has been major support for the VIX.

To move lower, the VIX will need two closes under 8.99.

Minor support should be at 8.98. And minor resistance is at 9.77 and 9.96.

$SPX:

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
Minor level: 2,460.98
Minor level: 2,445.33
Major level: 2,437.50

The objective should now be up to 2,539. Yesterday's high was 10 cents under the minor 2,529.33 level. This level should be taken out at the open.

Minor support is at 2,524.40.

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
Minor level: 135.94
Minor level: 132.81

The QQQ closed at 145.58. The objective should be to 150.

Minor support is at 145.53 and 144.53.

IWM:

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
Minor level: 141.41
Major level: 140.63

The IWM hit the 150 objective, closing exactly at 150.

149.22 and 148.33 should offer minor support. And minor resistance is at 150.78.

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

I mentioned yesterday that 125 should act as resistance and the high for the day was exactly 125 before the TLT sold off and closed at 124.28. A close today under 124.61 implies a move down to 123.44.

124.02 is minor support and 124.61 is minor resistance.

GLD:

Major level: 128.13
Minor level: 127.35
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 120.77. A close under 121.10 today and the GLD should drop to 118.75.

Minor support is at 120.31. Minor resistance is at 121.09.

XLE:

Major level: 71.89
Minor level: 71.11
Minor level: 69.54
Major level: 68.76 **
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 68.46. The XLE dropped as low as 67.49 before rallying to close down 2 cents on the day.

69.14 is minor resistance. And 68.16 is minor support.

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 85.20, under the 85.55 support level. The objective should still be down to 84.38.

85.35 to 85.74 should offer resistance. 84.96 is minor support.

Minor resistance is at 85.55 and minor support at 85.16.

AAPL:

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

153.13 should offer minor support. 156.25 should offer resistance.

Short term intra day charts are bearish, so resistance is at the 157 to 159 area.

WATCH LIST:

Bullish Stocks: GOOGL, LMT, BIDU, FDX, DPZ, RTN, LRCX, CELG, PX, ALB, CME, DE, CAT, UTX, RHT, ADP, KSU, KLAC

Bearish Stocks: WBA, TAP, WBA, DXCM, HA, TECK

Be sure to check earnings release dates.