While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to a 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
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Short Oct 9th - $6 Call @ $0.20
MSFT - Long Oct 23rd - $210.00 Call @ $5.95
MSFT - Short Oct 23rd - $215.00 Call @ $3.75
BOX Long at $17.65
BOX Short Oct 16th - $18 call @ $.40
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The market rebounded from the late day sell-off on Wednesday. For the day, the S & P 500 closed 58.47 points higher.
The market closed at 3,419.44.
This put the S & P back to within 20 points of the major 3,437.40 objective.
The range for the day was only 41.70 points. This was 69% of the daily average true range.
But, this should be expected. This is because Tuesday was a range expansion. And as you know, expansions follow contractions and contractions follow expansions.
And the day ended up being an inside day as well, with a lower high and a higher low.
The key for today is to watch the close of 3,419.44 and the high and low.
Usually, after an inside day, the market will continue in the direction of the violation of the high or low.
The high was 3,426.26 and the low was 3,384.56.
Pre open, the S & P is trading about 15 points higher. This projects to an open around 3,434.44 or about 8 points above yesterday's high.
So, watch for support around yesterday's high on a pullback.
Also, the 3,430 area could offer some support as well. If the market takes out the high on a selloff, look for support at the close at 3,419.44.
On a deeper sell-off, the monthly resistance level of 3,400, should now be support.
DPZ reported and is trading about $21 lower off their earnings.
Be aware of the levels I have mentioned above.
Here are the Key Levels for the Markets:
$VIX:
Minor level: 32.03
Major level: 31.25
Minor level: 30.47
Minor level: 28.91 **
Major level: 28.13 <
Minor level: 27.35
Minor level: 25.78
Major level: 25.00
Minor level: 24.22
Minor level: 22.66
Major level: 21.88
Minor level: 21.10
The VIX closed at 28.06. For the day, the VIX closed 1.42 points lower.
The VIX has now closed back under the major 28.13 level.
Also, the VIX continues to trade around the midband on the daily chart. The midband is 26.49. The VIX is trading just above the midband.
To move lower, the VIX needs to close under 27.35. The 29 area is technical resistance.
S & P 500:
Major level: 3,593.60
Minor level: 3,554.55
Minor level: 3,476.45
Major level: 3,437.40 <
Minor level: 3,398.35 **
Minor level: 3,320.25
Major level: 3,281.20
Minor level: 3,242.15
Minor level: 3,164.00
Major level: 3,125.00
Minor level: 3,085.95
Minor level: 3,007.85
Major level: 2,968.80
The S & P closed at 3,419.44. The minor 3,398.35 level should now be support.
The market should open about 3,434, which is 3 points under the major 3,427.40 level.
If the market can take out the major 3,427.40 level, it should then become support.
The S & P did clear the midband on the 60 minute chart, which is 3,390. This level should now become support.
QQQ:
Minor level: 289.06
Major level: 287.50
Minor level: 285.94
Minor level: 282.81
Major level: 281.25 <
Minor level: 279.69
Minor level: 276.56 **
Major level: 275.00
Minor level: 273.44
Minor level: 270.31
Major level: 268.75
Minor level: 267.19
Minor level: 264.06
Major level: 262.50
Minor level: 260.94
Minor level: 257.81
Major level: 256.25
The QQQ closed at 279.92. The QQQ closed 4.76 higher. Watch for the QQQ to reclaim the 276.56 level.
Support should be at the minor 276.56 level. And the watch the major 281.25 level. This should be the objective and the QQQ clears this level, it would then be support.
Watch for support at 276.56.
The QQQ cleared the midband on the 60 minute chart. That price level is now 279 and should be support.
IWM:
Major level: 162.50
Minor level: 160.94
Minor level: 157.81 **
Major level: 156.25
Minor level: 154.70
Minor level: 151.56
Major level: 150.00
Minor level: 148.44
Minor level: 145.31
Major level: 143.75
Minor level: 142.19
Minor level: 139.06
Major level: 137.50
The IWM closed at 160.04. The IWM closed 3.42 lower on the day.
With a close above 157.81 today, the IWM should test 162.50.
And the midband on the 60 minute chart is 152.74, and IWM took it out. It should now be support.
TLT:
Minor level: 169.53
Major level: 168.75
Minor level: 167.97
Minor level: 166.41
Major level: 165.63
Minor level: 164.85
Minor level: 163.28
Major level: 162.50
Minor level: 161.72
Minor level: 160.16
Major level: 159.38
Minor level: 158.60
Minor level: 157.03
Major level: 156.25
The TLT closed at 159.26. It closed 1.17 lower. The TLT closed just under the major 159.38 level.
Watch the minor 158.60 level. Two closes under this level and the TLT should drop to 156.25.
The TLT did retest the lower band on its 60 minute chart and closed below it. This tells us there should be further selling pressure after a bounce.
GLD:
Minor level: 188.28
Major level: 187.50
Minor level: 186.72
Minor level: 185.16
Major level: 184.38
Minor level: 183.60
Minor level: 182.03
Major level: 181.25
Minor level: 180.47 **
Minor level: 178.91
Major level: 175.00 <
Minor level: 174.25
Minor level: 172.70
Major level: 171.89
The GLD closed at 177.11. The GLD closed .08 lower on the day.
The objective should be to the major 175 level. Watch to see if it can hold as support.
Look for a retest of the lower band on the 60 mintue chart. That level is 173. Technical resistance is around 178.
XLE:
Minor level: 41.41
Major level: 40.63
Minor level: 39.83
Minor level: 38.28
Major level: 37.50
Minor level: 36.72
Minor level: 35.15
Major level: 34.37
Minor level: 33.59
Minor level: 32.03
Major level: 31.25
Minor level: 30.47
Minor level: 28.90 **
Major level: 28.12
The XLE closed at 30.16. The XLE closed .42 higher.
The XLE needs to hold 28.90 to move higher. A break of it and I would expect it to drop.
If the XLE can clear 31.25, it should continue to bounce.
Short term charts remain bearish. And the lower band on the 60 minute chart is 27. And the midband is 33.18, which should be resistance on a bounce and the objective at this point.
AAPL:
Minor level: 140.63
Major level: 137.50
Minor level: 134.38
Minor level: 128.13
Major level: 125.00
Minor level: 121.88
Minor level: 115.63 **
Major level: 112.50 <
Minor level: 109.13
Minor level: 103.13
Major level: 100.00
Apple closed at 115.08. Apple managed to close $1.92 higher.
Apple needs to recoup 115.65 to move higher.
Apple broke under the midband on the 60 minute chart. That level is 117 and should be resistance. Apple has crossed into a downtrend on the 60 minute chart. Short term momentum is bearish. Watch the midband.
WATCH LIST:
Bullish Stocks: NVDA, ZM, DPZ, TSLA, RH, COST, BABA, FDX, CRM, AMGN, WDAY, DG, ROKU, LH, TEAM, SQ, LVGO, NKE, Z, PTON, DDOG, ZEN, CDAY
Bearish Stocks: LMT, NOC, LHC, DIX, GWRE, EXPE, CBOE, MRK, CM, CVX, PRGO, MTZ, LVS, EOG, MPC, UFS
