January 10, 2019 - MDT Pro Tips A.M.

CURRENT POSITIONS:

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XLong at $20.30
X Jan 18th - $21.00 Call @ $0.50

WDCLong Feb 15th $40 Call @ $1.96
WDC Short Feb 15th $45 Call @ $0.60
......................................................................................... 

Yesterday continued the bounce from the severe oversold condition after the selloff.  For the day, the market closed up 10.55, at 2,584.96.

The range for the day was only 26.43 points.  As compared with the average true range of 71.94, the range contracted to 37% of the average.

A contraction tends to be bearish.  And the close percentage was 61% which still gives us a slight bullish bias.

But yesterday was the first close above the major 2,578.10 level.  The key for today will be if the market can close above it again.

If it can, I would view that as bullish.  If it can't, it would still need two closes above 2,578.10 to confirm the bullish move.

However, if the S & P 500 cannot close above the major 2,578.10 level, and the market does pullback, I would expect strong support at 2,500.

If we scope down and take a look at the shorter chart time frames, we can try and anticipate what the market should do.

The 60 minute chart is still downtrending.  And the midband is 2,607.52.  Yesterday's high came to within 8 points of the midband.

This level should typically offer resistance on the first rally to it especially when price dropped under the lower band which the S & P 500 did.

If we scope down further and look at a 30 minute chart, we see that the 30 minute has crossed into an uptrend.

This does suggest that short term momentum is shifting to the upside.  And price is above the midband on the 30 minute.

The midband on the 30 minute chart is now 2,532 and should now offer support.

So, we have technical resistance at 2,607 and technical support at 2,532.

If we scope down even further and look at a 10 minute chart, we see that is also in an uptrend and the midband is 2,529.

So, there should be decent support around 2,529 to 2,532.

Yesterday's price bar closed at 61%.  So, the odds of violating the high before the low is just over 50%.

The support area from yesterday's price bar is in the 2,582 area.

Pre open, the S & P 500 is trading about 9 points lower.

This would imply an open around 2,576.

The open would be under the 2,582 area, so you want to see how the market reacts around that level on a bounce.

Of course, the projected open is also about 2 points under the major 2,578.10 level.  This is certainly a price level to watch today.

The 2,601 resistance level from the long-range weekly bar is still valid.

Continue to monitor the levels as I mentioned above.

Here are the Key Levels for the Markets:

$VIX: 
 
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 **
Minor level: 19.53
Major level: 18.75

The VIX closed at 19.84 for the day. With a second consecutive close under 21.10, the objective should be to 18.75.

The VIX has also now had multiple closes under the major 21.88 level.  This suggests that long term, the VIX could retest 12.50.

And higher levels should be resistance.

Short term, 19.53 could offer support.  And 21.09 should be resistance. 

SPX: 

Major level: 2,656.30
Minor level: 2,636.75
Minor level: 2,597.65 **
Major level: 2,578.10 <
Minor level: 2,558.58 **
Minor level: 2,519.53 
Major level: 2,500.00 
Minor level: 2,484.38 
Minor level: 2,453.13 
Major level: 2,437.50  
Minor level: 2,421.88 

A close above 2,578.10 would be bullish for this market.

If the S & P 500 cannot close above 2,578.10, I would expect strong support at 2,500.

Minor support is at 2,558.60.  And 2,597.70 could offer resistance. 

QQQ:  

Major level: 168.75 
Minor level: 167.19 
Minor level: 164.06 
Major level: 162.50 <
Minor level: 160.94 
Minor level: 157.81 ** 
Major level: 156.25 
Minor level: 154.69 
Minor level: 151.56 
Major level: 150.00 
Minor level: 148.44 
Minor level: 145.31
Major level: 143.75

The QQQ closed at 160.82.  The high for the day came within one point of the 162.50 level.

159.38 and 157.81 should offer minor support.  And 160.94 is minor resistance.

Like the S & P 500, the 30 minute chart is bullish and the 60 minute chart is bearish.  However, price is trading above the midband on the 60 minute chart, which is 160.08.

IWM:
 
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 
Minor level: 135.94 
Minor level: 132.81 

The IWM closed at 142.90.  143.75 should be the target for the IWM.  And the IWM came within 40 cents of it.

The IWM will need to move up to the 143.75 level for me to consider this downtrend has ended.

137.50 should be strong support.  And minor support is at 139.06.

TLT:  

Major level: 125.00
Minor level: 124.61
Minor level: 123.83
Major level: 123.44 
Minor level: 123.05
Minor level: 122.27 
Major level: 121.88 <
Minor level: 121.49 **
Minor level: 120.70
Major level: 120.31 
Minor level: 119.92

The TLT closed at  121.24, down 0.19 on the day.  This now implies that if the TLT should test 120.31. 
At this point, I would suggest support at 120.31.  So, if the TLT does take out this level, it should continue to drop.

Short term charts remain bullish, so I do expect the TLT to bounce around before any pullback would occur. 

GLD: 

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 
Minor level: 117.97 
Minor level: 116.41 
Major level: 115.63 

The GLD closed at 122.31.  Watch to see if the GLD can clear the 121.88 level.  If it can, I would expect if to head higher.

At this point, if the GLD can close above 122.66 for two days, it should test 125.

121.48 should offer minor support. 

XLE: 

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 
Minor level: 61.72 
Minor level: 60.16 **
Major level: 59.38 <
Minor level: 58.60
Minor level: 57.03 
Major level: 56.25

The XLE closed at 62.20.  The high for the day came within 10 cents of the 62.50 level.

Clearing 62.50 would be bullish.  But, at this point, it is resistance.

58.38 is major support.

FXY:

Major level: 89.84
Minor level: 89.65
Minor level: 89.26
Major level: 89.06
Minor level: 88.87
Minor level: 88.48
Major level: 88.28 <<
Major level: 87.50 <
Major level: 86.72
Major level: 85.94 
Minor level: 85.75
Minor level: 85.36 
Major level: 85.16 
Minor level: 84.97 

The FXY close at 88.41. It closed up 0.61 on the day.  It will need two closes above 88.48 to move higher.

A close today above 88.28 would also be bullish for the FXY.

87.50 is a key level for the FXY.  I would expect strong support at 87.50.

AAPL:

Minor level: 173.44
Minor level: 170.31 
Major level: 168.75 
Minor level: 167.19
Minor level: 164.06
Major level: 162.50 
Minor level: 159.38 
Minor level: 153.13 **
Major level: 150.00 <
Minor level: 146.88 
Minor level: 140.63
Major level: 137.50

Apple close down at 153.31.  If Apple can close above 153.13 today, it should test 162.50. 

159 should be support.

WATCH LIST:

Bullish Stocks:HLF, GCO, AHL, NLY, AGNC

Bearish Stocks:ADBE, MMM, ALGN, BIDU,  ASML, BABA, LGND, UPS, TXN, GRUB, ALB, SWKS, AKAM, AABA, CERN

Be sure to check earnings release dates.