September 6, 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.

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The market continues to try and find some footing after clearing the major 2,890.60 level. But, as we know, it is not unusual for some profit taking after a major level is violated.

For the day, the market closed at 2,888.60, down 8.12 points for the day.

The S & P 500 hit a low of 2,876.92 before rallying back almost 13 points to close at 2,888.60.

The daily price bar formed was almost a perfect doji, where the open is almost the close.

I brought up yesterday the concept of where support should come in. I mentioned a few levels where support could be.

Of course, we have our resistance levels. I suggested that if 2,890.60 could not hold, a drop to 2,878.40 would be possible. Yesterday's low was about a point and one half under that resistance level.

The low was also within one point of the 200 ema on the 30 minute chart. The 200 ema is 2,877.52.

The major point of all this is that trading to the longside does make sense when both shorter term charts are in uptrends ... and that remains the situation at the moment.

And continues to be the situation.

Resistance from yesterday's daily price bar is in the 2,885 to 2,890 area.

You also want to watch the close, which was 2,888.60. This should be a key price level for today.

Pre open, the S & P 500 is trading slightly to the upside. Watch yesterday's close it see if it holds as support.

Here are the Key Levels for the Markets:

$VIX:

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
Minor level: 7.81
Major level: 6.25

The VIX managed to close higher for the day, at 13.91. It still continues to close under the 14.06 level. The high for the day came in at 14.30, before dropping to close under.

As I have said, I don't see a big push up in the VIX until it closes above 14.06. Until then, look for it to hold as resistance.

Minor resistance is now at 14.06 and 14.84. And minor support is at 13.28.

SPX:

Major level: 2,939.50
Minor level: 2,927.28
Minor level: 2,902.83 **
Major level: 2,890.60 <
Minor level: 2,878.40
Minor level: 2,854.00
Major level: 2,841.80
Minor level: 2,829.60
Minor level: 2,805.20
Major level: 2,793.00

If the S & P 500 can clear the 2,902.80 level. If it can, it should head higher.

2,878.40 should continue to offer support. 2,898.84 could offer some resistance on the upside.

Short term intra day 30 and 60 minute charts are still bullish. Technical support is around 2,878.

QQQ:

Major level: 193.75
Minor level: 192.19
Minor level: 189.06 **
Major level: 187.50 Hit!
Minor level: 185.94
Minor level: 182.81
Major level: 181.25
Minor level: 179.69
Minor level: 176.56
Major level: 175.00

The QQQ closed at 183.45. A test of 181.25 is likely. And yesterday's low was one cent above the minor 182.81 level.

A break under 182.81 and the QQQ would confirm a move down to 181.25, which should offer support.

"Watch to see if the QQQ can reclaim the minor 185.94 level." From yesterday. And the high for the day was 185.55 before selling off.

Like the S & P 500, short term charts remain bullish.

IWM:

Major level: 175.00 <
Minor level: 174.22
Minor level: 172.66 **
Major level: 171.88
Minor level: 171.10
Minor level: 169.53
Major level: 168.75
Minor level: 167.97
Minor level: 166.41
Major level: 165.63

The IWM closed at 171.79. With a close under 172.66, the IWM will still need two closes above 172.66 to move higher.

At this point, support should be at 171.09 and 170.31. 174.22 could offer resistance.

TLT:

Major level: 123.44
Minor level: 123.05
Minor level: 122.27
Major level: 121.88
Minor level: 121.10 <
Minor level: 119.53
Major level: 118.75 **
Minor level: 118.36
Minor level: 117.58
Major level: 117.19

The TLT closed at 119.71. A test of 118.75 is probable.

The TLT did break under the midband on the daily chart, which is now 120.42.

At this point, minor resistance is at 119.92.

The short term 30 minute chart did cross into a downtrend. Short term momentum is shifting to the downside.

GLD:

Major level: 117.19
Minor level: 116.80
Minor level: 116.02
Major level: 115.63
Minor level: 114.85 **
Minor level: 113.28
Major level: 112.50 <
Minor level: 111.72
Minor level: 110.16
Major level: 109.38

The GLD closed at 113.32. It was up .39 for the day. The low came in at 113.12, just 62 cents above the 112.50 objective.

112.50 is a minor support. 113.28 is minor resistance, as well as 114.06.

XLE:

Major level: 78.13
Minor level: 77.35
Minor level: 75.78 **
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 74.18. The XLE will need two closes above 75.78 to move up to 78.13. And two closes under 74.22 to move lower. And yesterday was the first close under 74.22.

Watch the 74.22 level today.

The XLE is trying to figure out which way to move. It remains stalled between the 75 and 74.22 levels.

Minor support should now be at 73.83 and 73.44. And minor resistance is at 75.39.

FXY:

Major level: 86.72 <
Minor level: 86.53
Minor level: 86.14 **
Major level: 85.94
Minor level: 85.75
Minor level: 85.36
Major level: 85.16
Minor level: 84.97

The FXY closed at 85.74. The low for the day was exactly on the minor 85.55 level. If 85.55 can hold, a bounce is possible.

85.35 should offer support. And resistance is at 86.04.

Technical resistance is at 85.95, so it the FXY can clear this level, it should continue higher.

AAPL:

Major level: 237.50
Minor level: 234.38
Minor level: 228.13 ***
Major level: 225.00 <
Minor level: 221.88
Minor level: 215.63
Major level: 212.50
Minor level: 209.38

Apple closed at 226.87. With a failure to close above 228.13, Apple will still need two closes above that level to move up to 237.50.

Watch to see if Apple can hold support at 225. If it can, it should make a run at 228.13.

Short term charts still remain firmly bullish. Buy oversold conditions.

WATCH LIST:

Bullish Stocks: AMZN, ALGN, ILMN, DPZ, ADBE, BDX, DIA, COST, PANW, AAPL, MA, AET, AMGN, CME, WDAY, ADSK, CRM, GRUB

Bearish Stocks: TSLA, LRCX, EXP, SWKS, SPR, LRCX, CPA, RGLD, KHC, AN, HAL, NTRI, JD, OSTK, TECK,

Be sure to check earnings release dates.