December 1, 2020 - MDT Pro Tips

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.

The month of November closed out with the S & P 500 closing 16.72 points lower. The S & P closed out the day at 3,621.63.

The low for the day was 3,594.39. And the range for the day was 39.79 points. The range was 80% of the daily average true range, which is now 50 points.

This was the 14th consecutive range contraction. This suggests we will see an expansion.

But, the daily bar managed to close at 68% of the range of the daily bar. This does suggest that the high of 3,634.18 should be violated before the low of 3,594.39.

And pre open, the S & P is trading about 33 points higher.

This projects to an open around 3,654 or about 20 points above yesterday's high. Watch for support around the 50% level of the gap, which would be around 3,644, on a pullback.

And speaking of the low, it dropped to about 4 points below the lower end of the weekly price bar support level, which was 3,598.

After stopping just under the weekly support level, the market rallied back to a high of 3,634.18, which was about 10 points below last week's high of 3,644.31.

As I mentioned yesterday, last week's weekly close suggested the high should be violated.

And based on the pre market trading, last week's high should be taken out at the open.

Watch for support at last week's high of 3,644.31. This level also just happens to be about the 50% level of the projected gap.

The November monthly price bar closed at 93% of the range of the bar. This puts the odds of violating November's high of 3,645.99 before the low of 3,279.74 at around 90%.

The range for November was 366 points. This was 132% of the monthly average true range. This qualifies as an expansion.

Support from the November monthly bar is around the 3,459 to 3,463 area.

CRM reports today after the close, along with BOX and VEEV.

SNOW and SPLK report Wednesday after the close. CBRL and DG report Thursday before the open.

Thursday after the close, we get earnings from DOCU, RH, and ULTA.

Here are the Key Levels for the Markets:

$VIX:

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 **
Minor level: 19.53
Major level: 18.75

The VIX closed at 20.57. The VIX closed .30 points lower.

The objective for the VIX should be to the 18.75 level.

21.88 and 22.66 should be resistance.

Technical resistance is around 21.50.

S & P 500:

Major level: 3,749.80
Minor level: 3,710.75
Minor level: 3,632.65 **
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

The S & P closed at 3,621.63. The S & P closed 16.72 points lower. Watch for the S & P to recoup the major 3,632 level. This level should then be support if taken out.

The minor 3593.60 level, which should be support on a sell off.

3,605 should be technical support. And if the S & P clears 3,628, it would then be support.

QQQ:

Minor level: 301.56
Major level: 300.00 Hit
Minor level: 298.44
Minor level: 295.31 **
Major level: 293.75 <
Minor level: 292.19
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

The QQQ closed at 299.62. The QQQ closed .61 higher.

The QQQ hit a high of 3 cents under the 300 level.

The upper band on the weekly chart is 292.25 and the QQQ is above it. This level should be support.

The 297.50 should be minor support.

IWM:

Major level: 187.50
Minor level: 181.25
Minor level: 176.56 **
Major level: 175.00
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: 160.94
Minor level: 157.81
Major level: 156.25
Minor level: 154.70

The IWM closed at 181.02. The IWM closed 3.35 lower on the day.

The objective for the IWM should still be to 187.50. But, it needs to reclaim the minor 181.25 level.

I am looking for a retest of the upper band on the 60 minute chart. That level is 190.

180 should be technical support.

TLT:

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
Minor level: 155.47
Minor level: 153.91
Major level: 153.13

The TLT closed at 160.02. It closed .20 lower. The TLT managed to close just under the 160.16 level. If it cannot reclaim 160.16, I would expect it to drop.

A drop under 159.38 would also suggest a move lower.

The TLT is back above the midband on the 60 minute chart. That level now is 158.29.

This level should now be support. So, watch the key level today.

GLD:

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: 171.88
Minor level: 171.10
Minor level: 169.53
Major level: 168.75
Minor level: 167.97 **

The GLD closed at 166.67. The GLD closed 1.12 lower on the day.

A close today under 167.97 and expect the GLD to drop further.

The major 171.88 level should be resistance now. And so should 171.10.

The GLD is now oversold. It is right under the lower band on the 60 minute chart. That level is 167.59. The GLD needs to recoup this level to head higher.

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: 28.13

The XLE closed at 36.76. The XLE closed 2.15 lower on the day. The midband on the daily chart is 39.06 and the XLE broke under it.

Watch the minor 36.72 level today. If it cannot hold, look for more movement lower.

I still expect another rally because the XLE did manage to close above the upper band on the 60 mi minute chart. Support should be around 32.

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 119.05. Apple closed $2.46 higher.

Target now should be up to the 125 level.

Apple is right at the midband on the 60 minute chart. That level is 117. Apple did reclaim this level, so it should be support.

WATCH LIST:

Bullish Stocks: TTD, GOOGL, TSLA, RH, LRCX, ASML, AVGO, COST, ZBRA, PANW, COUP, ADSK, ANET, ULTA, DE, KLAC, GS, URI, TEAM, SQ, V, ITW, HON, AMP, KSU, MCK, CAT

Bearish Stocks: AMT, BIDU, BAX, K, CNC, FE