November 5, 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.

I suggested closing the MAS debit spread yesterday after one day. The overnight return worked out to be just under 60%. I do apologize for the typo in the alert.

The rally continued yesterday. Yesterday closed 74.28 points higher.

The S & P 500 closed the day out at 3,443.44.

And the range for the day ended up being 81.10 points. This was 124% of the daily average true range, which is now 65.36 points.

The day closed at 47% of the range of the daily bar. But this does not include the fact that the market gapped 37.30 points higher at the open.

The support area from yesterday's daily bar is in the 3,446 area. Under this level, there is support around 3,425.

Pre open, the S & P is set to gap higher again. The S & P is trading 64 points higher before the open.

This projects to an open around 3,507 or about 21 points above yesterday's high.

Watch for support around 3,497 on a sell off. If this level is taken out, then look for support around yesterday's high of 3,486.25.

With the S & P trading above the midband on the 60 minute chart, this level should now offer technical support. This level is 3,387.

QCOM reported last night and is trading about $18 higher. MELI is up about $85 after reporting.

BABA reported and is trading about $8 lower. After the close today, we hear from BIDU and BKNG.

Here are the Key Levels for the Markets:

$VIX:

Minor level: 41.40
Major level: 40.62
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
Major level: 25.00

The VIX closed at 29.57. The VIX closed 5.98 points lower.

This put the VIX under the 34.38 level. This was also was the first close under 30.47.

If the VIX closed under 30.47 today, then I would expect a drop o 28.13.

The VIX dropped to the midband on the 60 minute chart, which was the objective. And it is now sitting right on the midband, which is 29.05.

If the VIX breaks under the midband, look for it to continue lower.

S & P 500:

Major level: 3,593.60
Minor level: 3,554.55
Minor level: 3,476.45
Major level: 3,437.40 <
Minor level: 3,398.35
Minor level: 3,320.25
Major level: 3,281.20
Minor level: 3,242.15
Minor level: 3,164.00
Major level: 3,125.00
Minor level: 3,085.95
Minor level: 3,007.85
Major level: 2,968.80

The S & P closed at 3,443.44. The S & P closed 74.28 points higher. The pre-election continued. And looks to follow through again this morning.

Yesterday's close put the S & P back above the major 3,437.40 level. The next minor level is 3,476.45. Two closes above this level and the S & P should head up to 3,593.60.

The S & P is now above the midband on the 60 minute chart, which is 3,386.
This level should be support.

QQQ:

Major level: 293.75
Minor level: 292.19
Minor level: 289.06
Major level: 287.50 <
Minor level: 285.94
Minor level: 282.81
Major level: 281.25
Minor level: 279.69
Minor level: 276.56
Major level: 275.00
Minor level: 273.44
Minor level: 270.31
Major level: 268.75

The QQQ closed at 286.91. The QQQ closed 12.26 higher. The QQQ was up 4.46%.

The QQQ should clear 287.50 and if it can, it would then be support. The next level after that is 289.06.

Support should be at the 285.94 level.

Like the S & P, the QQQ took out the midband on the 60 minute chart. This level should now be support. The midband is 279.

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: 154.70
Minor level: 151.56
Major level: 150.00
Minor level: 148.44
Minor level: 145.31
Major level: 143.75

The IWM closed at 160.42. The IWM closed .18 higher on the day.

The IWM got as high as 162.35 yesterday. The target is still to the 162.50 level.

The midband on the 60 minute chart which is 156 and should now be support.

158 should be technical support.

TLT:

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

The TLT closed at 161.08. It closed 3.42 higher. The TLT closed just above the minor 160.16 level. A close today above this level and the TLT should test 162.50.

The TLT is right at the midband on the 60 minute chart. That level is 161.24. If the TLT cannot clear this level, I would expect it to drop. So, watch this level today.

159 should be technical resistance.

GLD:

Minor level: 188.28
Major level: 187.50
Minor level: 186.72
Minor level: 185.16
Major level: 184.38
Minor level: 183.60
Minor level: 182.03
Major level: 181.25
Minor level: 180.47
Minor level: 178.91 **
Major level: 175.00 <
Minor level: 174.25
Minor level: 172.70
Major level: 171.89

The GLD closed at 178.82. The GLD closed .10 lower on the day.

The GLD will still need two closes above the minor 178.91 to move higher.

The GLD is just above the midband on the 60 minute chart. That level is 178.54.
If the GLD can hold this level, it should continue higher.

XLE:

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: 34.37
Minor level: 33.59
Minor level: 32.03
Major level: 31.25
Minor level: 30.47
Minor level: 28.90 **
Major level: 28.13 <

The XLE closed at 29.57. The XLE closed .04 higher.

I expect a move up to 31.25. Having said that, it needs to clear the midband on the 60 minute chart. That level is 30.28.

If it can't clear the midband, look for the XLE to drop. 28.13 should be support though.

AAPL:

Minor level: 140.63
Major level: 137.50
Minor level: 134.38
Minor level: 128.13
Major level: 125.00
Minor level: 121.88
Minor level: 115.63
Major level: 112.50 <
Minor level: 109.13 **
Minor level: 103.13
Major level: 100.00

Apple closed at 114.95. Apple closed $4.51 higher.

Watch the next minor level in the upside, which is 115.63. Two closes above this level and Apple should head up to 125.

Apple is right at the midband on the 60 minute chart. That level is 114.47. If Apple can hold this level, look for a move higher.

111 is technical support.

WATCH LIST:

Bullish Stocks: PEN, RMD, FIVN, UTHR, FFIV, XLNX, GRMN, YY, GRMN, PDD, FSLR, JD, BG, SCCO, LSCC, GO, IQ

Bearish Stocks: LMT, NOC, ULTA, BURL, LHX, GPN, CME, BA, ZBH, GD, WEX, DIS, IT, IBM, UHS, MDT, GWRE, FISV, DRI, CBOE, TRU, BAX