May 11, 2020 - MDT Pro Tips A.M.

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.

CLVS settled in the money, so your calls should have been assigned and your shares sold at $8. The return ended up being 8.72% for 4 days.

The short $22 call on HOG expired on Friday. I will look to sell more calls this week.

I also suggested you add a weekly covered call on IQ. You should be short the $18 call that expires this Friday.

Friday, the S & P 500 closed out the week at 2,929.80. For the day, the S & P 500 closes 48.61 points higher.

The S & P closed within 5 cents of the minor 2,929.75 level.

The intra day range was only 29.28 points because of the bullish gap open of 27.64 points.

This lowers the daily average true range to 75.96 points.

And the day closed at 92% of the range of the daily price bar. This suggests that Friday's high of 2,932.16 should be violated before the low of 2,902.88.

And the support area from Friday's daily bar is in the 2,917 to 2,919 area.

The weekly price bar closed 99.09 points higher. The weekly price bar closed at 98% of the range of the weekly bar.

And the support from the weekly price bar is in the 2,865 to 2,872 area.

The weekly range was only 134.12 points. And the weekly average true range is 176.55. So, this was the fourth consecutive weekly bar that contracted.

This does suggest we will see an expansion.

I do want to highlight where the upside resistance is.

The midband is the most important resistance level. That price level is 2,981.77 and Friday's high was 2,932.16 or about 50 points below the midband.

This should be resistance and how the market reacts at this level should suggest the next move for the market.

The other key level is the 61.8% retracement level of the down move.

This price level is 2,934.49 or 2 points above Friday's high. Watch this level. The market needs to clear this level to head higher.

The other level to watch is the high of the April monthly price bar, which is 2,954.86.

Pre market, the S & P 500 is trading about 30 points lower. This projects to an open just below Friday's low. Watch to see if the market can recoup the low on a rally.

BABA reports Thursday before the close. And WIX also reports Thursday before the close.

Here are the Key Levels for the Markets:

$VIX:

Minor level: 39.84
Minor level: 38.28
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

The VIX closed at 27.98. At this point, resistance on the VIX should be at 28.91.

And 28.13 should be a key level in the short term. If the VIX cannot clear this level, it should head lower.

The 31 area should be technical resistance.

S & P 500:

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
Minor level: 2,617.25
Minor level: 2,539.06
Major level: 2,500.00

The S & P closed at 2,929.80. The objective should be to 2,968.80, but the market needs to clear the minor 2,929.75 level.

The 2,851 level should be support.

Technical support is around 2,890.

QQQ:

Major level: 231.22
Minor level: 229.66
Minor level: 226.56 **
Major level: 225.00 Hit
Minor level: 223.42 **
Minor level: 220.31
Major level: 218.75
Minor level: 217.19
Minor level: 214.06
Major level: 212.50
Minor level: 210.93
Minor level: 207.81
Major level: 206.25
Minor level: 204.69
Minor level: 201.56

The QQQ closed at 224.86. The QQQ hit the objective of 225. In fact, Friday's high was exactly 225.

Look for support at the minor 220.31 level. And the minor 223.42 level.

Technical support should also be around 222. 227 is resistance.

IWM:

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
Minor level: 129.69
Minor level: 126.56
Major level: 125.00
Minor level: 123.44

The IWM closed at 132.36. The IWM took out the 131.25 level.

At this point, the IWM will need two closes above 132.81 to move higher.

Technical support is around 125. And the 140 area is technical resistance. It needs to clear 133 to head higher.

TLT:

Major level: 169.53
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
Minor level: 157.03
Major level: 156.25
Minor level: 155.48

The TLT closed at 163.98. A close today under 164.85 and the TLT should drop to 162.50.

It will have to clear 163.98 to move higher.

The 166 area should be technical resistance. Support is around 161.

GLD:

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
Minor level: 155.47
Minor level: 153.91
Major level: 153.13

The GLD closed at 160.42. The next minor level on the upside is 160.16. And on the downside, the level is 158.60. A close today above 160.16 and the GLD should test 162.50.

Support should be at 158. And technical resistance is around 162.

The GLD is starting to top out.

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 38.78. At this point, if the XLE can hold 38.28, it should head up to 40.63.

37.50 should be support.

Technical support should be around 37. And resistance at the 42 level.

AAPL:

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
Minor level: 278.13
Major level: 275.00
Minor level: 271.88
Minor level: 265.63
Major level: 262.50

Apple closed at 310.13. Apple held the 300 level. Target should be to 312.50.

The minor 303 level should be support.

304 should offer technical support. And technical resistance is around 318.

WATCH LIST:

Bullish Stocks: GOOGL, SHOP. CHTR, DXCM, NOW, ADBE, NVDA, AAPL, RNG, AAPL, ZBRA, CLX, COUP, AGN, MSFT, ADSK, CRM

Bearish Stocks: WBA, PINC, LX, RESI, LC