January 8, 2020 - MDT Pro Tips A.M.

GOGO Long at $19.93
Total Premium Collected $1.95

ASNA Long at $14.20
Total Premium Collected $0.75

DUST Long $4.50
Total Premium Collected $0.70

RRC Long at $11.85
Total Premium Collected $0.70

RRC Long at $9.20

RIG Long at $8.81
Premium Collected - $1.45

FEYE Long at $17.18
Total Premium Collected $1.06
FEYE Short Jan 17th - $19 Call @ $0.26

DBX Long at $17.18
DBX Short Jan 31st-$17 call @ $0.70

X Long at $11.33
X Short Jan 10th - $11.50 call @ $0.35

NET Long at $17.09
NET Short Jan 17th - $17.50 call @ $0.55

FDX Long Jan 17th - $150 Put for $3.05
FDX Short Jan 17th - $145 Put for $1.37

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Yesterday, I suggested selling a call option against the FEYE open position. You should be short the $19 call that expires next Friday. This brings the call premium collected on the position to $1.06 or about 6% of the purchase price.

The market pulled back yesterday, selling off 9.10 points. It ended the day closing at 3,237.18.

The market failed to take out Monday's high, which was projected based on Monday's close percentage of 98%.

And it failed to take out the low as well. So, the daily price bar for yesterday ended up as an inside day.

An inside day is also a contraction. And yesterday's range was only 12.48 points. The average true range is 20.54, so yesterday's range was only 61% of the average.

This contraction suggests that the market should expand at some point.

The key for today will be to watch for a violation of the high or the low. Price will tend to continue in the direction of the violation.

Yesterday's high was 3,244.91 and the low was 3,232.43. The other key price level is the close, which was 3,237.18

The support area from last week's weekly price bar should also be valid. That level is in the 3,235 to 3,237 area.

A break above this area should be support. And a break under it would be resistance.

Pre open, the S & P is trading about 7 points 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 Friday at 13.79. At this point, the VIX should test 12.50 again. And 14.85 should be resistance. Yesterday's high went to 14.46 or about 40 cents under it.

The 14 area should be technical resistance. It should be resistance.

Watch the minor levels for the VIX as well today. And watch the 14 level.

SPX:

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
Minor level: 2,773.45

The S & P closed at 3,237.18. The S & P closed back under the minor 3,242.15 level. It will need to recoup this level to head higher.

With a projected open about 7 points higher, the market should open above the minor 3,242,15 level. This level should be support assuming an open above it.

3,125 should still be support.

The bullish percent index remains overbought, but at this point, we have not had a spike in the VIX. Technicals remain bullish for the market.

Technical support is still at 3,234.

QQQ:

Major level: 218.78
Minor level: 218.00
Minor level: 216.43
Major level: 215.65 <
Minor level: 214.87 ***
Minor level: 213.30
Major level: 212.50
Minor level: 211.74
Minor level: 210.17
Major level: 209.39
Minor level: 208.61
Minor level: 207.04
Major level: 206.25

The QQQ closed at 215.53. Watch to see if the QQQ can clear the 215.65 level. If it can, it should be support and make a run to 216.43.

Support should now be at 214.87. And it will need two closes above 216.43 to move up to 218.78.

And the 214 area should offer technical support. Minor resistance should be at 217.

IWM:

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 IWM closed at 164.80. At this point, 167.19 should be resistance and support should be at 164.06. And a close above it today and the IWM should move up to 168.75.

If the IWM cannot clear 167.19, it should continue down.

The 165 area should offer technical resistance. The IWM will need to clear this level to head higher.

TLT:

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
Minor level: 132.81
Major level: 131.25

The TLT closed at 137.65. At this point, I would expect resistance at 139.85.

Technical support is at 137. If the TLT drops under this level, the TLT should head lower.

The 138 area should be resistance.

GLD:

Major level: 150.00
Minor level: 149.22
Minor level: 147.67 **
Major level: 146.89 Hit
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 147.97. At this point, if the GLD closes above 147.67 today, it should test 150.

The GLD continues to be overbought short term. It is trading above the upper band on the 60 minute chart, which is 146.94.

137.50 should be strong support. So if the GLD does break under it, I would expect it to head lower.

The key level is 134.38 on the downside. If the GLD has two closes under this level, it could drop to 125.

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 60.71. The objective should be up to 62.50.

Watch for support at the 60.16 level. And at 59.38.

Technical support is still around 60.25.

AAPL:

Major level: 300.00 Hit
Minor level: 296.88 **
Minor level: 290.63
Major level: 287.50
Minor level: 284.38
Minor level: 278.13
Major level: 275.00
Minor level: 271.88
Minor level: 265.63
Major level: 262.50

Apple closed at 298.39. Apple hit the major 300 level again. Yesterday's high was 300.90.

Apple is overbought and right at the upper band. Not a time to go long. The upper band is 302.59.

296.88 should offer support. And minor support is at 290.63.

The 295 area should offer technical support.

WATCH LIST:

Bullish Stocks: TSLA, NOC, ROP, ADBE, NTES, MA, AAPL, LRCX, NOW, GS, RTN, BABA, LHX, FB, MCD, DE, COUP, CB

Bearish Stocks: ALXN, TSCO, SQ, CLB, UFS, QGEN, MAC, BEN

Be sure to check earnings release dates.