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.
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Yesterday continued with narrow range trading. The intraday range was only 9.97 points. The range for the day was only 34% of the daily average true range, which is now 29.13.
This was the fourth consecutive day of range contractions.
As you know, this will lead to an expansion. The question is when.
Perhaps, we will see that expansion after the Fed announcement on interest rates tomorrow at 2:00 EST.
The S & P 500 ended up closing at 2,889.67. It was up 2.69 points on the day.
So, the market continues to try and hold the major 2,890.60 line. Yesterday's high did get about 7 points above the 2,960.60 level, but it ended up closing about 1 point under it.
If the S & P 500 can clear this level, I would expect support here.
The bias is still to the upside unless the S & P 500 has two closes under 2,871.08.
Also, the daily chart still remains in an uptrend. And the 60 minute chart is very close to crossing into an uptrend.
In fact, the 200 ema and the 253-day average are very close to each other. A bullish crossover would most certainly indicate that the market will head higher.
If the 60 minute chart can cross into an uptrend, that would mean that the 30 minute and daily charts are all bullish.
So, this would be a bullish event. I will certainly continue to monitor this technical condition.
Support from yesterday's daily bar is in the 2,890 to 2,892 area.
Also, continue to watch last week's close of 2,885.83 for support or resistance.
Tomorrow at 12:00 EST is our webinar. Hopefully, I will see you there.
Here are the Key Levels for the Markets:
$VIX:
Major level: 21.88
Minor level: 21.10
Minor level: 19.53
Major level: 18.75
Minor level: 17.97
Minor level: 16.41 **
Major level: 15.63 <
Minor level: 14.85
Minor level: 13.28
Major level: 12.50
Minor level: 11.72
The VIX closed yesterday at 15.35. The VIX continues to trade under the major 15.63 level. And this level should continue to offer resistance.
16.02 should also offer minor resistance on the upside.
And 15.23 is the minor level on the downside to watch. Two closes under 15.23 and the VIX should drop to 14.
SPX:
Major level: 2,968.80
Minor level: 2,949.25
Minor level: 2,910.15 **
Major level: 2,890.60 < < HIT
Minor level: 2,871.08 **
Minor level: 2,832.03
Major level: 2,812.50
Minor level: 2,792.98
Minor level: 2,753.93
Major level: 2,734.40
Minor level: 2,714.88
Minor level: 2,675.83
Major level: 2,656.30
The market continues to hang around the major 2,890.60 level ... for a third day.
Minor support is still at 2,880.90. So, watch this level if the market does pull back.
I am expecting a run to 2,910.15. And as you know, if the S & P 500 can close above it for two days, it should run up to 2,968.80
Technical support should be in the 2,883 area.
The 60 minute chart is close to moving into an uptrend.
QQQ:
Major level: 193.75
Minor level: 192.19
Minor level: 189.06
Major level: 187.50 <
Minor level: 185.94
Minor level: 182.81 **
Major level: 181.25 <<
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
The QQQ closed at 183.74. The objective is still up to 187.50.
181.25 should still be support. And minor support is at 182.81. Watch this level on a pullback to see if it holds.
Technical support is at 183. Like the S & P 500, the QQQ is close to crossing into an uptrend.
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 152.24. Still biased for a move up to 156.25.
The IWM gapped up and managed to close above the midband on the daily chart. That price level is now 151.16.
Watch to see if this level holds as support.
150 should be strong support. Minor support is at 151.56.
TLT:
Major level: 134.38
Minor level: 133.60
Minor level: 132.03
Major level: 131.25
Minor level: 130.47 **
Minor level: 128.91
Major level: 128.13
Minor level: 127.74
Minor level: 126.95
Major level: 126.56
Minor level: 126.17
Minor level: 125.39
Major level: 125.00
The TLT closed out at 131.69. The TLT is still above the upper band, which is 131.51.
The TLT is overbought but wait for a strong close under the upper band before shorting.
131.45 is minor support. And is the TLT can hold 131.45, I would expect a move up to 132.50.
GLD:
Major level: 128.13
Minor level: 127.74
Minor level: 126.95 **
Major level: 126.56 << HIT
Minor level: 126.17
Minor level: 125.39
Major level: 125.00
Minor level: 124.22
Minor level: 122.66
Major level: 121.88
Minor level: 121.49
Minor level: 120.70
Major level: 120.31
The GLD closed at 126.48. It is now trading around the major 126.56 level. If it can hold the 126.56 level, I would expect a move up to 131.
On the downside, 125 should offer support. And 123.44 is a minor level to watch as well. Two closes under this level and the GLD should drop to 118.
Technical support should be at 126.
XLE:
Major level: 65.63
Minor level: 64.85
Minor level: 63.28
Major level: 62.50 <
Minor level: 61.72
Minor level: 60.16 **
Major level: 59.38
Minor level: 58.60
Minor level: 57.03
Major level: 56.25
Minor level: 55.47
Minor level: 53.91
Major level: 53.91
The XLE closed at 61.52. The XLE should test 62.50. 62.50 is a strong resistance level. So if the XLE does clear 62.50, look for it to move higher.
On the downside, 59.38 is the key level. Two closes under this level and the XLE could drop to 50.
60.94 is a minor support level. If the XLE can hold this level, it would also confirm the move up to 62.50.
The 30 minute chart has crossed into an uptrend, so momentum is shifting to the upside. Technical support is at 61.
AAPL:
Minor level: 203.13
Major level: 200.00
Minor level: 196.88
Minor level: 190.63 **
Major level: 187.50 <
Minor level: 184.38
Minor level: 178.13 **
Major level: 175.00
Minor level: 171.88
Minor level: 165.63
Major level: 162.50
Apple closed at 193.89. At this point, I do expect a test of 200.
190.63 should be minor support.
200 is a key level for Apple. If it does take out 200, it should move up to 250.
WATCH LIST:
Bullish Stocks: CMG, ORLY, ANTM, MCD, LIN, ACN, DECK, CB, KMB, DG, RACE, PYPL, YUM, ALL, ROKU, WING
Bearish Stocks: NFLX, DPZ, AGN, CXO, UTHR, NTAP, FIZZ, PRGO, AMTD
Be sure to check earnings release dates.