December 18, 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.

There are three positions that expire today. Two of the positions, BOX and HEAR are trading above their strike prices, so they will most likely be assigned.

Leave these positions alone and if an adjustment is to be made, you will receive a separate email.

The final position is the short call on IQ. If you followed the alert, you should have sold the $23 call that expires today. This option will no doubt expire worthless due to the sell-off IQ experienced.

IQ sold off news that they are doing a secondary offering. About one-half of the total outstanding float changed hands in the last two days. This is certainly a selling climax.

The S & P 500 continued its bull move yesterday.

For the day, the S & P 500 closed 21.31 points higher. The market closed the day out at 3,722.48.

The intra day range did contract once again. The range for the day was 14.25 points. This was only 35% of the daily average true range, which is now 40.67 points.

The daily price bar closed at 81% of the range of the daily bar.

The support from yesterday is around 3,718.

And the high of the inside bar on Tuesday should still be support. The high was 3,695.29.

Yesterday's move put the S & P within 25 points of the 3,749.80 objective.

And pre open, the S & P is relatively flat.

If we take a look at the weekly price bar we see that it has made a new high and a high low. This is a bullish price bar and yesterday closed above the midpoint, which is 3,685.48.

Watch the midpoint on a pullback.

The S & P is just under the upper band on the weekly chart. That level is 3,743.68.

FDX reported and is trading about $9 lower. DRI reported and is trading about $3 lower. And WGO reported and is trading about $3.50 higher.

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 21.88. The VIX closed .362 points lower.

The objective for the VIX should be down to 18.75.

24.22 should be resistance. And technical resistance is around 23.

The midband on the 60 minute chart, which is 25.40 should still be resistance.

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 3,722.48. The S & P closed 21.31 points higher.

The objective should still be to the 3,749.80 level.

3,710.75 should offer support.

The 3,686 area should be a technical support area.

QQQ:

Major level: 312.50
Minor level: 310.94
Minor level: 307.81 **
Major level: 306.25 HIT
Minor level: 304.69 **
Minor level: 301.56
Major level: 300.00
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

The QQQ closed at 311. The QQQ closed 2.02 higher.

The next level for the QQQ is 307.81. And yesterday was the first close above it.A close today above 307.81 and the QQQ should head up to 312.50. And the QQQ is within 1 point of it.

Support should be at the 308.

IWM:

Minor level: 195.31 **
Major level: 193.75 HIT
Minor level: 192.19
Minor level: 189.06
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

The IWM closed at 196.29. The IWM closed 2.31 higher on the day.

This was the first close above 195.31 level. A close today above this level and the objective should be up to 200.

194 should be technical support. And the 195.31 level should be 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 Hit
Minor level: 155.47
Minor level: 153.91
Major level: 153.13

The TLT closed at 156.80. It closed .42 lower. At this point, watch the 156.25 level.

A break under this level and the TLT should head lower.

The TLT broke under the 60 minute chart. This level is 158.04. With a break under this level, it should be resistance.

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 176.74. The GLD closed 1.84 higher on the day. The GLD closed back above the major 175 level.

By clearing 175, it should be support.

The GLD took out the midband on its 60 minute chart. That price level is 174.69 and the GLD closed above it. The midband should be support.

XLE:

Major level: 43.75
Minor level: 42.95
Minor level: 41.40
Major level: 40.63 < HIT
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

The XLE closed at 40.07. The XLE closed .19 lower on the day. Watch the major 40.63 level today. A move above this level and the XLE should head higher.

Two close under 39.83 today and the XLE should drop to 37.50.

But, the XLE is above the midband on the daily chart, which is 38.36 and should be support.

AAPL:

Minor level: 140.63
Major level: 137.50
Minor level: 134.38
Minor level: 128.13
Major level: 125.00 HIT
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 128.70. Apple closed $.89 lower.

The next minor level is 128.13. Two closes above this level and Apple should head up to 137.50.

Watch for support at 125.

The 124.00 area should provide technical support.

WATCH LIST:

Bullish Stocks: TTD, NOW, ROP, RNG, TWLO, SPOT, ROKU, PANW, SEDG, CVNA, GS, SQ, TTWO, DIS, ETSY, BAND, FIVN, BIDU, JNJ, PKI, MTCH

Bearish Stocks: AMT, RETA, ETR, PNW, D, ED, K, BMY, CNC, SO, ELS, NUVA