August 29, 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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After moving up nicely off the last pivot low, the S & P 500 barely made any thrust yesterday.

For the day, the S & P 500 closed .78 points higher, at 2,897.52.

But, after taking out a major level, this price action is not unusual. The market is new territory.

Since the last pivot low, the S & P 500 has now run two levels. The last pivot low was on August 15th, at 2,802.49. This was 9.49 points above the major 2,793 level.

And yesterday's high was 2,903.77. That high was 13.17 points above the major 2,890.60.

The next upside level, which is 2,902.83 should tell us if the S & P 500 should run up to the next level, which is 2,939.50.

And yesterday was the first close above it. So, a close today above 2,902.83 and the objective becomes 2,939.50.

A move up to 2,939.50 would be a three level move off the last low. And three levels is typically what the market will run in a bull market.

Both short term, 30 minute and 60 minute charts remain bullish, but price is up against the upper bands on both charts. The upper band on the 60 minute chart is now 2,906.80 and on the 30 minute is 2,910.59.

This warns us that for the short term, price is hitting an extreme.

Pre open, the S & P 500 is trading about 2 points higher.
Continue to monitor the longer term levels for the market.

Watch the 2,902.83 level today.

Support from yesterday's daily price bar is in the 2,898 to 2,900 area.

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 closed at 12.45. The VIX is still under the major 12.50 level, but both the S & P 500 and the VIX closed for the second consecutive day to the upside, we have another divergence that warns us for a possible short term top.

Yesterdays high was exactly at the major 12.50 level. At this point, I would still expect resistance at 12.50 and at 13.28.

We are still looking for a retest of 11.72. And the key will be if the VIX can close for two days under it.

If it does, the VIX could retest 9.38.

Watch to see it the VIX can clear 12.50. If it can, we may see a minor reversal.

SPX:

Major level: 2,939.50
Minor level: 2,927.28
Minor level: 2,902.83 **
Major level: 2,890.60 < Hit
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

Watch the 2,902.83 level today. A close above it and the active objective becomes 2,939.50.

Short term intra day 30 and 60 minute charts are still bullish. Technical support is at 2,860.

Short term support level is at 2,890.60.

QQQ:

Major level: 187.50
Minor level: 185.94
Minor level: 182.81 **
Major level: 181.25 <
Minor level: 179.69
Minor level: 176.56
Major level: 175.00
Minor level: 173.44
Minor level: 170.31
Major level: 168.75

The QQQ closed at 184.61. Objective should be up to 187.50.

184.38 should be a short term support level. And 182.81 should also offer support. 190.63 could offer resistance.

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 172. Yesterday was the first close above the major 171.88 level.

Minor support should be at the 171.09. 173.44 could offer resistance on the upside.

TLT:

Major level: 123.44 <
Minor level: 121.49
Minor level: 120.70 **
Major level: 120.31
Minor level: 119.92
Minor level: 119.14
Major level: 118.75
Minor level: 118.36
Minor level: 117.58
Major level: 117.19

The TLT closed at 120.86. Objective is still to the 123.44 objective. And the TLT will have to reclaim 121.49 today to head higher.

The TLT is sitting just above the midband on the daily chart. That level is 120.77. A break under this level would be bearish.

120.31 should offer support. And 122.66 minor resistance.

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

It closed at 113.68. The GLD reversed to the downside. A close today under 114.85 would suggest a test of 112.50.

114.84 is minor resistance. And 112.50 should offer support.

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 74.77. If the XLE can move above 76.56, I would expect it to continue higher. Continues to try and reclaim the major 75 level.

Minor support should now be at 74.22 and 73.83.

The 30 minute chart is close to crossing into an uptrend. If it can, expect the XLE to move higher.

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 86.03. To move higher, the FXY will need two closes above 86.14. But, the FXY is holding above 85.75. Two closes under 85.75 and the FXY should drop to 85.16.

86.04 should offer support, and at 85.94.

Short term charts are bullish, so momentum is to the upside. But technical resistance is at 86.19. The FXY will need to clear this level to move higher.

AAPL:

Major level: 225.00 **
Minor level: 221.88
Minor level: 215.63
Major level: 212.50 <
Minor level: 209.38
Minor level: 203.13
Major level: 200.00

Apple closed at 219.70. Target should now be up to 225.

217.19 is a minor support level. On the upside, Apple needs to clear 221.88 level to head higher.

WATCH LIST:

Bullish Stocks: AMZN, CMG, ILMN, ANET, DPZ, SPY, NVDA, UNH, BDX, PANW, ZBRA, WDAY, V, SODA, RHT, GRUB, SPLK, DECK, DG, NTAP,

Bearish Stocks: AVGO, BABA, ITW, SMG, HIG, AMAT, CPB, BECN, JD, WRK, AN

Be sure to check earnings release dates.