September 22, 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

DIN Long December $40 call at $2.40
DIN Short December $45 call at $1.15

PANW Long Oct $145 Call at $2.44

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The contraction pattern continues. Yesterday again saw a range of only 8.16 points. Compared to the average true range (ATR) of 12.45, the range for yesterday was a 65% contraction compared to the ATR.

As I mentioned a few days ago, this seems to be the general pattern for the market.

The low volatility is also a factor in this. With the VIX down to 9.67, it is now within 29 cents of the objective I have been calling for. Should this be a concern? No question it should.

But, the market did not break hard yesterday, as you would expect. For the day, the market closed at 2,500.60, down 7.64 on the day.

The major 2,500 level held as support ... for the time being. But, the problem has been that the S & P 500 cannot get above the next minor level, which is 2,509.78.

Yesterday's high fell short. The high for the day was 2,507.16.

But with the 30 minute and 60 minute both strongly uptrending, I would expect another rally after profit taking sets in.

And that could happen today with another inside day formation on the S & P 500. We could expect an expansion day. And the 2,504 area could offer resistance.

This is also around a minor support level, which is 2,502.

Pre open, the S & P 500 is trading slightly to the downside, so a lower open is expected. Watch how the market reacts in the 2,502 to 2,504 area.

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: 8.60
Minor level: 7.03
Major level: 6.25

The VIX closed at 9.67, down .11 for the day. It is creeping down to the 9.38 objective.

Both the S & P 500 and the VIX closed to the downside, which is a divergence.

9.96 should be minor resistance. 9.57 is a minor support level.

$SPX:

Major level: 2,539.10
Minor level: 2,529.33
Minor level: 2,509.78 **
Major level: 2,500.00 < Hit!
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

On the upside, watch the 2,502 and 2,504.90 levels. If the market cannot clear this area, expect a move down.

On the downside, watch the 2,498 and 2,496 area.

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 144.46, under the minor 145.31 line. A move down to 143.75 is likely.

145.31 should be resistance. And watch the 144.14 level for support.

IWM:

Minor level: 144.53
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: 135.15
Major level: 134.37

The IWM closed at 144.69, taking out our objective of 143.75 again.
The IWM took out the prior high by one cent.

143.36 should offer minor support. And 144.53 minor resistance.

Short term charts remain bullish.

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

The TLT closed at 125.84. To move higher, the TLT will need two closes above 128.91.

125.78 should be support. Resistance is at 126.37 to 126.56.

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: 124.22 **
Minor level: 122.66
Major level: 121.88 <
Minor level: 120.32

The GLD closed at 122.68. The objective should now be to 121.88.

120.31 should be minor support and resistance should be at 123.44.

XLE:

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
Minor level: 61.72
Minor level: 60.16
Major level: 59.38

The XLE closed at 66.86. The objective should be to 68.76.

Support should now be at 66.60. 67.58 is resistance.

67.687 is the midband on the daily chart and a level to watch.

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 continues to sell off and closed at 85.35. The objective now should be to 84.38.

Look for resistance at 85.55. And support at 85.16.

AAPL:

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

Apple continued its selloff and closed at 153.39. 151.56 is a minor support and most likely will need be violated. If it is, expect further movement to the downside.

155.47 should be minor resistance.

WATCH LIST:

Bullish Stocks: TSLA, BIDU, FDX, MMM, AMGN, SPZ, ALGN, LLL, RTN, NVDA, COST, CMI, SWK, ALXN, CME, CAT, RCL, UNP

Bearish Stocks: SBNY, PZZA, UBNT, DISH, MDLZ, MNK, RDUS, MDCO

Be sure to check earnings release dates