July 23, 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 S & P 500 continued its assault on the 3,281.20 objective. The market closed 18.72 points higher.

Yesterday closed out at 3,276.02. And the high for the day was 3,279.32, which took out Tuesday's high by 2.03 points.

The intraday range was only 26.22 points. This was about half the daily average true range, which is 50.65 points.

This was the sixth consecutive day where the daily range did not exceed the daily average true range.

Certainly, we will see an expansion soon.

Wednesday closed at 87% of the range of the daily price bar. This does suggest that yesterday's should be violated before the low.

And pre open, the S & P is trading about 6 points higher. Assuming this trading holds up through the open, the S & P should open around 3,282, which would be about one point above the objective we have been looking for.

This trading would also take out yesterday's high.

So, watch for support at the high of 3,279.32. Under that level is the daily price support level of 3,266.

The key for the market at the moment has been the midband on the VIX.

As I have pointed out, the VIX is trading right at the midband, which is 24.67. For the last four days, it has literally traded right at the midband.

As I have said, there are two options which should tell us the next move for the market. And the moves are on the VIX.

Either the VIX breaks under the midband or it holds as support and moves higher.

And yesterday, the VIX closed just under the midband. The VIX closed at 24.32 and the midband is 24.67.

So, it closed just the support level. This now implies the VIX should head lower and the market will move higher.

CMG reported last night and is trading about $18 lower. TSLA reported as well and is trading about $55 higher. And MSFT is trading about $3.50 lower.

Here are the Key Levels for the Markets:

$VIX:

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
Minor level: 22.66
Major level: 21.88

The VIX closed at 24.32. The VIX closed .52 points lower for the day.

Watch the 24.22 level. Two closes under this level and the VIX should drop to 21.88.

And as I mentioned above, the VIX closed just under the midband, which is 24.67. This level should now be resistance.

S & P 500:

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
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

The S & P closed at 3,276.02. The objective for the S & P should still be up to 3,281. And should get hit right at the open.

The next minor level on the upside should be 3,320.25.

The 3,242 level should now be support. Also, support should be at the minor 3,164 level.

Technical support is around 3,266.

QQQ:

Major level: 268.75
Minor level: 267.18
Minor level: 264.05 **
Major level: 262.50 Hit
Minor level: 260.93 **
Minor level: 257.80 <
Major level: 256.25
Minor level: 254.69
Minor level: 251.56
Major level: 250.00

The QQQ closed at 264.93. The QQQ closed 0.93 higher.

The key at the moment is the upper band on the daily chart. That level is 266.89. Watch to see if the QQQ can clear the upper band.

The QQQ will either pullback from this level and close back above it and head higher.

But, I am still looking for support around the major 262.50 level. Technical support is also around this level.

And the QQQ closed above the 264.05 level. This suggests that if the QQQ can close above it today, it should head up to 268.75.

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 < Hit
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 148.11. The objective for the IWM should still be up to 150. And the IWM came to within 1.40 cents of the target.

And the IWM is now about 2 points above the midband on the daily chart, which is now 145.97.

This level should now be support.

145.31 should be support. And 147 should be technical support.

TLT:

Major level: 168.75
Minor level: 167.97
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

The TLT closed at 167.79. The objective for the TLT should be up to 168.75.

And the TLT is now within 30 cents of it.

165.63 should now be support. Watch this level. A break under
his level and the TLT should head lower.

The TLT needs to clear the 167 level to move higher. And it is just above it. so, watch this level today. This level should be support now.

GLD:

Major level: 175.00 HIT
Minor level: 174.25
Minor level: 172.70
Major level: 171.89
Minor level: 171.11
Minor level: 169.54
Major level: 168.75
Minor level: 167.98
Minor level: 166.41
Major level: 165.63
Minor level: 164.85
Minor level: 163.28
Major level: 162.50

The GLD closed at 175.63. The GLD took out the 175 objective.

172.70 should be support.

The GLD is right at the upper band on the daily chart. That level is 176.17. Watch to see if the GLD can clear this level.

XLE:

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 Target - HIT
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 37.79. The XLE managed to close above the major 37.50 level. It will need two closes above 38.28 to head higher.

The 36.72 level should now be support. 37.50 should also be support.

AAPL:

Major level: 400.00
Minor level: 396.88
Minor level: 390.63 **
Major level: 387.50 < Hit
Minor level: 384.38 **
Minor level: 378.13
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

Apple closed at 389.09. Apple closed 1.09 higher. Watch to see if Apple can hold the major 387.50 level. It should still be support.

However, Apple is right at the upper band on the daily chart. That level is 406. This sets up a few price expectations.

And technical support is also around 387.

WATCH LIST:

Bullish Stocks: REGN, CHTR, NOW, ILMN, LRCX, ALGN, APD, RH, MKC, CMI, ITW, VRSK, CTXS, TREX, DGX, VRNS, PGR, LOGM

Bearish Stocks: VMW, ADI, AZPN, C, PLAN, APPN, NTNX, SUN