July 2, 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.

Yesterday, I suggested booking the profit on the BMY position. The deal ended up yielding a return of 36% for a holding period of a week and one half.

The July 4th rally continued yesterday, with the S & P 500 hitting the 3,125 objective.

The S & P closed 15.57 points higher on the day. The market closed out at 3,115.86.

The high for the day was 3,128.44, which took out the 3,125 objective by 3.44 points.

And it closed just above the high of the bearish long range candle from June 24th, which was 3,115.01. Never the less, it did close above that high, which is bullish.

And the daily bar closed at 54% of the range of the bar, which is neutral. Also, the range contracted. The intra day range was only 27.27 points, which was 43% of the daily average true range.

But, this is not unusual heading into the release of the Non Farm Payroll this morning.

The report was positive and the S & P is trading about 36 points higher after the release.

This projects to an open around 3,150.

Watch to see if the S & P can clear the next minor level, which is 3,164.

If we take a look at how the weekly price bar is forming, we see that the range through yesterday was 129 points.

This is about 50 points less than the weekly average true range.

If we project the weekly high, based on the average range, it works out to 3,177.

Last week's high was 3,154.90 and the projected open would be just under it.

Watch last week's high to see if the market can clear it. If it can, it would then be support.

As a reminder, today is the last day of this week because of the market closure tomorrow because of the national holiday.

Enjoy your July 4th weekend and stay healthy!

Here are the Key Levels for the Markets:

$VIX:

Major level: 37.50
Minor level: 36.72
Minor level: 35.16
Major level: 34.38
Minor level: 33.60
Minor level: 32.03
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

The VIX closed at 28.62. It closed 1.81 lower on the day. The low for the day was 28.20. This put the VIX 7 cents above the major 28.13 level.

Watch to see if the VIX violates this level. If it does, it should be resistance.

And 30.47 should also be resistance.

And technical resistance is at 31.

S & P 500:

Major level: 3,281.20
Minor level: 3,242.15
Minor level: 3,164.00
Major level: 3,125.00 < Hit
Minor level: 3,085.95
Minor level: 3,007.85
Major level: 2,968.80
Minor level: 2,929.75
Minor level: 2,851.65
Major level: 2,812.50
Minor level: 2,773.45
Minor level: 2,695.35
Major level: 2,656.30

The S & P closed at 3,115.86. 3,007.85 level should still be support. And 3,046 is a minor support level as well.

The next minor level is 3,164. And support should be at 3,144.50. If the market pulled back to 3,144.50, the weekly price bar would still close above 80% of the range of the weekly bar. This would be bullish.

Technical support is around 3,100.

QQQ:

Major level: 256.25
Minor level: 265.68
Minor level: 251.56 **
Major level: 250.00 < Hit
Minor level: 248.54
Minor level: 245.31
Major level: 243.75
Minor level: 242.15
Minor level: 239.00
Major level: 237.50
Minor level: 235.91
Minor level: 232.78
Major level: 231.22

The QQQ closed at 250.49. The QQQ closed just above the 250 objective.

The next minor level is 251.56. Two closes above this level and the QQQ should test 256.25.

Technical support is around 250. Short term charts remain bullish.

IWM:

Major level: 156.25
Minor level: 154.70
Minor level: 151.56
Major level: 150.00
Minor level: 148.44
Minor level: 145.31
Major level: 143.75
Minor level: 142.19
Minor level: 139.06 **
Major level: 137.50
Minor level: 135.94
Minor level: 132.81
Major level: 131.25

The IWM closed at 141.82. The objective should now be to 143.75.

The IWM is making a run at the midband, which is 146.48. Of course, what the market will do at that level should tell us quite a bit as to the next move.

The minor 142 level should be resistance. If the IWM can clear this level, it should head higher.

Technical support is now at 140.

TLT:

Major level: 165.63
Minor level: 164.85 **
Minor level: 163.28
Major level: 162.50 < Hit
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 163.42. The objective should be down to 162.50. And yesterday's low took out the target. The low was 162.15.

163.28 should be resistance.

Support is still around 162, which is the midband on the 60 minute chart. And technical resistance is at 165.

A break under 162 and the TLT should head lower.

GLD:

Major level: 168.75
Minor level: 167.98
Minor level: 166.41 **
Major level: 165.63 Hit
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

The GLD closed at 166.62. The objective for the GLD should be to 168.75. But, it did hit the upper band on the 60 minute chart and has pulled back.

If needs to clear the minor 167.98 level.

Support should be at 162.

XLE:

Minor level: 47.65
Major level: 46.88
Minor level: 46.09
Minor level: 44.53
Major level: 43.75
Minor level: 42.97
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: 34.27

The XLE closed at 36.93 The XLE is holding the minor 36.72 level. If it can clear 37.50, look for it to provide support.

To move higher, the XLE will need two closes above 38.28.

The midband on the 60 minute chart is now 39 and the XLE is below it. This should now be resistance. This level is 39 and the XLE will need to clear it to head higher.

The 36 area should be support.

AAPL:

Major level: 375.00
Minor level: 371.88
Minor level: 365.63
Major level: 362.50 <
Minor level: 359.38 **
Minor level: 353.13
Major level: 350.00
Minor level: 346.88
Minor level: 340.63
Major level: 337.50
Minor level: 334.38
Minor level: 328.13
Major level: 325.00

Apple closed at 364.11. Apple closed .69 points lower.

The 362.50 level should be support. And watch to see if Apple can clear 365.

Apple needs two closes above 365.63 to move up to 375.

Technical support is around 362.

WATCH LIST:

Bullish Stocks: AMZN, MELI, SHOP, NTES, AAPL, RNG, COUP, SPOT, ZM, WIX, VEEV, HUBS, TWLO, SPLK, DOCU, ALNY, WING, EA

Bearish Stocks: LMT, NOC, COST, INTU, APD, BDX, PANW, ANET, VRSN, JAZZ, CHKP, KEYS, CYBR, HCA