September 16, 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 you close the BMY debit spread position yesterday. The result was a 43% gain for three days.

The market continues to tick higher. Yesterday, the S & P 500 closed 17.66 points higher. the day closed out at 3,401.20.

And yesterday was the second consecutive range contraction. The daily range was only 30.23 points. This was 53% of the daily average true range, which is now 57.12 points.

This does suggest we will see an expansion.

And the daily price bar closed at only 50% of the range of the daily bar.

This is a neutral reading. And pre open, the S & P is trading about 18 points higher.

This would project to an open around yesterday's high, which is 3,419.48. This would suggest that the close of 3,401.20 should be support on a pullback.

Also, the midband, which is 3,404, should also be a support level.

And finally, the minor support level at 3,398.35 should offer support on a pullback.

From a technical standpoint, the short term minute chart is still bullish, so continued follow-through would be expected.

FDX reported last night and is trading about $21 higher. ADBE is trading about $10 higher after reporting.

Here are the Key Levels for the Markets:

$VIX:

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
Minor level: 21.10

The VIX closed at 25.59. For the day, the VIX closed .26 points lower.

The key again for the VIX is the midband on the daily chart. That level is 25.81 and the VIX managed to close just under it. The daily bar is straddling the midband.

A break under this level and the VIX should head lower.

If the VIX holds at the midband, it should bounce which would suggest the market would reverse lower.

A break under the midband and the market should continue higher.

Technical resistance is right around 28.

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 3,401.20. Watch for support at the 3,398.35 level. And the objective should be up to the major 3,427.40 level.

Technical support is right around 3,382. And support form yesterday's daily bar is around 3,404.

Also, the S & P is still holding the midband on the 60 minute chart. That level is now 3,378 and should be support.

Short term trends remain bullish.

QQQ:

Minor level: 298.44
Minor level: 295.31
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
Minor level: 267.19

The QQQ closed at 279.06. The QQQ closed 3.90 points higher. A close today above 276.56 and the QQQ should test 281.25.

Support should be at the minor 276.56 level. And at the major 275 level.

The QQQ cleared the midband on the 60 minute chart. That level is 276.60. This should now be support.

IWM:

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 HIT
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

The IWM closed at 153.37, closing .29 higher. The objective for the IWM should be up to 156.25.

153.74 is the midband on the 60 minute chart and the IWM is just under it. It will need to clear this level to head higher.

147 is the midband on the daily chart and should be support. 152 should be technical support.

TLT:

Major level: 171.88
Minor level: 171.10
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

The TLT closed at 164.07, closing .40 lower. The objective for the TLT should be to the 165.63 level. But, it needs to clear the minor 164.85 level.

But, if the TLT cannot clear 164.85, the TLT should drop to 162.50.

Technical resistance is still around 166. And also around 165. Watch this area.

Short term charts remain bearish.

GLD:

Major level: 190.63
Minor level: 189.85
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

The GLD closed at 183.45. The GLD closed .44 lower on the day.

Watch the 183.60 level. A close today under 183.60 and the GLD should drop to 181.25.

Short term momentum has turned bearish. The technical resistance level is 184. If the GLD can clear 184, it should head 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: 28.12

The XLE closed at 32.63. 32.03 should be support. If the XLE can hold this level, it should head up to 34.27.

Short term the XLE is oversold. It did move above the lower band on the 60 minute chart, which is now 31.90. This should be support on a retest.

Looking for a bounce.

AAPL:

Major level: 150.00
Minor level: 146.88
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

Apple closed at 115.54. Apple closed .18 higher. Watch to see if Apple can close above 115.63.

Two closes abvoe 115.63 and Apple should test 125.

Also, Apple closed under the upper band on the daily chart. That price level is 126 and should now be resistance.

114.89 is the midband on the 60 minute chart and Apple is trading just above it. If it can hold the midband, I would expect a retest of the upper band on the daily chart.

WATCH LIST:

Bullish Stocks: RH, ALGN, FDX, MCD, DE, CAT, BYND, NKE, GH, PGR, CSX, IRBT, DKS, RDFN, VSLR, SFIX, UBER, DAR

Bearish Stocks: LMT, BDX, FLT, MLM, BA, AMP, HSY, GD, KEYS, BAX, LDOS, MAN, EFA, LAMR, CRUS BLUE