November 8, 2018 - MDT Pro Tips A.M.

CURRENT POSITIONS:

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OI Long Feb $19 call @ $1.70
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KMI Long (2) Nov 23rd-$17.00 put @ $0.40

MDR Long @ $9.31
MDR Short Nov $10 Call @ $0.25
......................................................................................... 

The post-election rally continues.  And strongly.  For the day, the S & P 500 closed 2.12% higher.  It closed for the day, up 58.44 points.

And closed out the day at 2,813.89.

Of course, this now satisfies the weekly close percentage projection.  If you recall, last week's weekly bar closed at 74% of the bar.  This puts the odds of violating the high before the low at around 74%.

A few days ago, I wrote about how I expected weakness to start the week.  Quite frankly that never materialized.

The week started out closing higher and never looked back.

Now the question is where could the high come in?

Yesterday's high was 2,815.15. Last weeks high stopped at around 50% of the range from the prior week.

If we use that same projection for this week, it projects to a high around 2,833.  This would be a level to watch for the balance of the week.

Yesterday's daily bar had an intra day range of 41 points.  But, if you factor in the bullish gap, the range becomes 59.70 points.

This would indicate that the daily bar was a long range candle which is quite bullish.

The daily average true range is 46.61, so if you factor in the gap, yesterday's range came in at almost 130% of the average.

And yesterday, the S & P 500 closed at 97% of the daily bar.

This puts the odds of violating yesterday's high before the low at almost 100%.

And support from yesterday should be at 2,794.

Pre open the S & P futures are trading to the downside about 10 points.  Watch for a move down and for price to firm and head back up.

Square, Inc, (SQ) reported last night and is off about $4 before the open.

Continue to monitor the levels as I mentioned.

Here are the Key Levels for the Markets:

$VIX: 
 
Major level: 31.25
Minor level: 29.69
Minor level: 26.56
Major level: 25.00 
Minor level: 23.44 
Minor level: 20.31 
Major level: 18.75 <
Minor level: 17.19 **
Minor level: 14.06 
Major level: 12.50 <

The VIX closed at 16.36.  The VIX had a massive drop of 17.83%.  For the day, it was down 3.55 points.

Not only did the VIX close under the major 18.75 level, it closed under the minor 17.19 level.

This now suggests that if the VIX can close under 17.19 today, it should drop again to 12.50.

Minor resistance should be at 17.19 and 17.97.

SPX: 

Major level: 2,841.80
Minor level: 2,829.60
Minor level: 2,805.20 **
Major level: 2,793.00 <
Minor level: 2,780.78
Minor level: 2,756.33 
Major level: 2,744.10 
Minor level: 2,731.90 
Minor level: 2,707.50 
Major level: 2,695.30 

With a close above 2,805.20 today, this would imply a test of the 2,841.80 level.  And the major 2,793 level should offer support.

Minor support is at the 2,797 level.

2,814 is the midband on the 60 minute chart and yesterday the market rallied right back to it.  It will have to clear it to head higher.

QQQ:  

Major level: 178.13
Minor level: 179.69  
Minor level: 176.56 **
Major level: 175.00 <  
Minor level: 173.44
Minor level: 170.31 
Major level: 168.75 
Minor level: 167.19 
Minor level: 164.06
Major level: 162.50 

The QQQ closed at 175.58.  This puts the QQQ just above the major 175 level and well above the midband, which is 168.66.

175 should offer support.  And two closes above 176.56 and the QQQ should move up to 178.13.

Like the S & P 500, the QQQ hit the midband on the 60 minute chart, which is 176.56.  It will have to clear this level to move higher.

IWM:

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 157.41.  The IWM is trading under the midband on the daily chart.  That level is 158.09 and should be resistance on a rally.  Watch to see if this can clear this level.

156.25 should offer strong support.

The midband on the 60 minute chart is 158.90. And the IWM is just under it.

TLT:  

Major level: 115.63
Minor level: 115.24
Minor level: 114.45
Major level: 114.06
Minor level: 113.67 
Minor level: 112.89 **
Major level: 112.50
Minor level: 112.11 **
Minor level: 111.33
Major level: 110.94

The TLT closed at 112.52.  The TLT will still need two closes under 112.11 to drop to 110.94.  It is trying to hold the 112.50 level.  If it can, I would expect a bounce.

To move higher, the TLT will need two closes above 112.89.  

GLD:  

Major level: 118.75
Minor level: 117.97
Minor level: 116.41 **
Major level: 115.63 
Minor level: 114.85 
Minor level: 113.28 
Major level: 112.50 
Minor level: 111.72
Minor level: 110.16
Major level: 109.38 

The GLD closed at 116.03.  At this point, 116.41 should still be minor resistance. And the GLD will have to clear 116.41 to move higher.  And it is still resistance, with yesterday's high at 116.35.

115.63 is minor support.  And 117.19 is minor resistance.  115.23 is a key level on the downside.  If the GLD closes under 115.23. I would expect a drop to 114.

XLE: 

Minor level: 72.66  
Major level: 71.88 
Minor level: 71.10
Minor level: 69.53 **
Major level: 68.75 <
Minor level: 67.97
Minor level: 66.41 
Major level: 65.63
Minor level: 64.85 
Minor level: 63.28
Major level: 62.50

The XLE closed at 70.14.    A close today above 69.53 and the XLE should test 71.88.

The midpoint of the monthly bar is 71.36.  Watch this level on a rally. 

69.53 is support now.  The short term 30 minute chart is close to crossing into an uptrend.  If it can, I would expect more movement to the upside.

FXY:

Major level: 85.94
Minor level: 85.75
Minor level: 85.36 
Major level: 85.16 
Minor level: 84.97 
Minor level: 84.58 **
Major level: 84.38 <
Minor level: 84.18 
Minor level: 83.79 
Major level: 83.59 

The FXY closed at 84.19.  Watch to see if the FXY can hold the 84.38 level.  It closed under it, so it should be resistance.  Watch how the FXY reacts at this level. 

Appears that the FXY is failing at the 84.38 level.  If it does, expect it to move lower.

83.98 should be minor support.  A break under this level and expect the FXY to move lower.

AAPL:

Minor level: 220.31 
Major level: 218.75 
Minor level: 217.19 
Minor level: 214.06
Major level: 212.50 
Minor level: 210.94
Minor level: 207.81 **
Major level: 206.25 <
Minor level: 204.69
Minor level: 201.56
Major level: 200.00

Apple closed 6.16 higher yesterday, at 209.22.  A close today above 207.81 and Apple should move up to 212.50.

207.81 should be support.  And expect support at 206.25.
  
WATCH LIST:

Bullish Stocks: CME, DECK, ESL, DG, HSY, TSCO, XLNX, WBA, OMC, TRIP, TWTR, CNK, KFY

Bearish Stocks: LLL, IBM, EA, ALL, CTSH, BG, CERN, BDC, SLB, GIS, ALKS, MTDR, WDR, CLVS, INN

Be sure to check earnings release dates.