January 31, 2020 - MDT Pro Tips A.M.

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As we close out the first month of the 2020 decade, the market ended up bottoming about the level I mentioned yesterday and managed to close 10.26 points higher.

Yesterday's low stopped at 3,242.80

There were two key price levels we were looking for yesterday.  The first was the minor 3,242.15 level. And the low stopped 65 cents above it.

Close enough to suggest our resistance levels worked again.  As I said yesterday do not expect the market to stop exactly on the levels.  And yesterday was no exception.

The second level I mentioned was the open gap, which was at 3,245.  The first bottom yesterday stooped just under it. Then on the retest, the higher bottom stopped at 3,245.92.  By the way, the actual gap was 3,245.77.

Having these levels before the open allows you to monitor the market to see if the market will reverse.

These reversals are timed with a sell off in the VIX. And that is what happened yesterday.

After the market bottomed, it ran right to the midband on its 10 minute chart.

The midband is 3,285.19.  And yesterday's high went to 3,285.91, taking it out by 72 cents.

The midband is often the price objective after moving back inside the lower band.

Interesting as well, is that the low took out the minor level by 65 cents and the high took out the midband by 72 cents.  Almost perfect symmetry.

Yesterday closed at 95% of the daily price bar.  And the daily range was 43.11 points.  This was greater than the daily average true range, which is 27.46.

In fact, the daily range was almost 160% of the average, which is bullish.

Support from yesterday's daily price bar is in the 3,270 area. 

The close of this week's weekly price bar is 11.81 pounds lower through yesterday.

A close above the midpoint would be bullish and at this point, the midpoint is 
3,263.99.

The weekly range through yesterday is 58.97 points.  This is actually almost the weekly average true range, which is 61.62 points.

The daily price bar close suggests that the high should be violated before the low, so I suspect we have not seen the full weekly range at this point.

The S & P will need to clear the midband on the 10 minute chart.  That level is 3,285.19 so watch this level today.

After reporting, TSLA closed $59.82 higher. And FB after reporting closed $13.70 lower.

AMZN reported last night and is trading about $205 higher.
  
Here are the Key Levels for the Markets:

$VIX: 

Major level: 21.88  
Minor level: 21.10 
Minor level: 19.53 
Major level: 18.75 <<
Minor level: 17.97 **
Minor level: 16.41 
Major level: 15.63 <
Minor level: 14.85 ** 
Minor level: 13.28 
Major level: 12.50 
Minor level: 11.72 
Minor level: 10.16
Major level:   9.38

The VIX closed yesterday at 15.49.  This VIX got as high as 18.39 before reversing and closing lower.

But we were looking for resistance at 17.97 and 18.75.

Yesterday's low went to 15.30 or back under the major 15.63 level.  Look for resistance at 15.63 and 16.41.

And if the VIX has two closes under 14.85, look for a drop to 12.50 again.

S & P 500:

Major level: 3,427.40 
Minor level: 3,398.35
Minor level: 3,320.25 
Major level: 3,281.20 <
Minor level: 3,242.15 ***
Minor level: 3,164.08 
Major level: 3,125.00 
Minor level: 3,085.95 
Minor level: 3,007.85 
Major level: 2,968.80    
Minor level: 2,929.73 
Minor level: 2,851.58 
Major level: 2,812.50 

The S & P closed at 3,283.66.  The market managed to close back above the major 3,281 level.

Pre open, the market is trading about 14 points lower. This suggests an open around 3,270.  As I mentioned above, this should be an intra day support level.

Watch to see if this level can hold.  If this level can't, watch the 3,266 level. 

Odds still favor a violation of the higher before the low.

QQQ:  

Major level: 225.00 
Minor level: 224.22 
Minor level: 222.69 
Major level: 221.91 <
Minor level: 221.13 **
Minor level: 219.56 
Major level: 218.75 
Minor level: 218.00 
Minor level: 216.43 
Major level: 215.65 
Minor level: 214.87 
Minor level: 213.30 
Major level: 212.50 

The QQQ closed at 222.60.  The QQQ did manage to take out the midband, which is now 221.93.  This level should now be support.

Watch the minor 221.91 for support.  If it can't hold, it should head lower.

The QQQ will need two closes above 222.69 to move higher.

IWM:

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: 154.69 
Minor level: 151.56 
Major level: 150.00 

The IWM closed at 163.93.  It closed flat for the day.  The IWM will need to clear 164.06 to move higher.

If the IWM has two closes under 160.94. it should drop to 156.

Technical resistance is around 165.30.

TLT:

Major level: 146.88
Minor level: 146.10
Minor level: 144.53 **
Major level: 143.75 <
Minor level: 142.97 
Minor level: 141.41 
Major level: 140.63 
Minor level: 139.85 
Minor level: 138.28 
Major level: 137.50 
Minor level: 135.84 

The TLT closed at 144.58.  With a close above 144.52, this now it suggests a move up to 146.88.

With the TLT reclaiming 143.75, it should now be support.

The TLT is still overbought short term.

GLD:  

Major level: 150.00 <
Minor level: 149.22
Minor level: 147.67 **
Major level: 146.89 
Minor level: 146.11 
Minor level: 144.54 
Major level: 143.75  
Minor level: 142.97 
Minor level: 141.41 
Major level: 140.63 
Minor level: 139.85 
Minor level: 138.28
Major level: 137.50 

The GLD closed at 148.47.  The GLD should test the major 150 level. 

147.67 should be support.

There is also technical resistance around the 150 level as well.

XLE: 

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 <<
Minor level: 55.86 
Minor level: 55.08 **
Major level: 54.69

The XLE closed at 55.16.  The XLE bounced from its oversold condition.

Now if the XLE closes above 55.08 today, it should move up to 56.25.

If the XLE can close above 55.48 today, it should get a decent bounce.

AAPL:

Major level: 325.00
Minor level: 321.88
Minor level: 315.63 **
Major level: 312.50 
Minor level: 309.38 
Minor level: 303.13
Major level: 300.00 
Minor level: 296.88 
Minor level: 290.63 
Major level: 287.50 
Minor level: 284.38

Apple closed 47 cents to the downside yesterday, at 323.87.  Watch to see if Apple can hold the minor 321.88 level.

Watch the 321.88 level on the downside.  If this level cannot hold, I would expect further selling.

Technical support is at 319.

WATCH LIST:

Bullish Stocks: GOOGL, TSLA, SHOP, LMT, ADBE, MA, FLT, AAPL, COST, LRCX, RNG, ADSK, V, GD, DECK, KLAC, HSY

Bearish Stocks: REGN, BA, ALGN, AAP, FFIV, CVX, XOM, CMA, QURE, FSLR, RAMP, HLF, CLB