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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After flirting with all-time highs, the S & P 500 pulled back slightly yesterday. The market closed 6.92 points lower.
The S & P closed the day at 3,373.43.
Both yesterday and Wednesday, the S & P came to within 6 points of the all-time high, which is 3,393.52.
Yesterday's high was 3,387.24, which was within 65 cents of Wednesdays high.
The intraday range was only 23.89 points. This was a contraction and was 58% of the daily average true range, which now reads 40.86 points.
And yesterday daily bar closed at only 42% of the range of the bar. This does give a slight bias to the low being violated before the high.
Yesterday's low was 3,363.35 and the support area is in the 3,373 to 3,375 area.
Pre-open, the S & P is trading about one point lower.
So, the market should open right in the support area. Watch the 3,375 to 3,275 area.
The weekly price bar is shaping up for another contraction.
The range for the week so far is only 61.45 points. This is only 44% of the weekly average true range. Assuming this week is another contraction, this would be the 8th consecutive weekly contraction.
And most likely, we will see another contraction because the S & P would have to move 77 points above the weekly high or below the weekly low to just hit the weekly average true range.
And with a daily average true range of about 41 points, it seems unlikely we will get a move that large today.
The weekly midpoint so far is 3,357. A close above this price would indicate that the weekly bar is bullish. So, watch this level on a selloff.
And BIDU reported and is trading about $6 lower.
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 Midband
Minor level: 24.22
Minor level: 22.66 **
Major level: 21.88 < HIT
Minor level: 21.10 **
Minor level: 19.53
Major level: 18.75
The VIX closed at 22.13. The VIX closed .15 points lower for the day.
Watch to see if the VIX can break the 21.88 level. If it does, I would expect the VIX to continue lower.
And resistance should still be at the midband which is 25.12.
Technical resistance is around 22.50.
S & P 500:
Major level: 3,437.40 < TARGET
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
Minor level: 2,929.75
Minor level: 2,851.65
The S & P closed at 3,373.43. The target for the S & P should still be up to 3,437.20.
Watch the minor 3,398.35 level. This level could offer some resistance.
The S & P came to within 6.28 points of the all-time high. And with objectives above the high, I do expect it to be taken out.
And the minor 3,320.25 level should be support. Minor resistance is at 3,359. The 3,359 level should be support.
Technical support is around 3,362.
QQQ:
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: 267.18
Minor level: 264.05
Major level: 262.50
Minor level: 260.93
Minor level: 257.80
Major level: 256.25
Minor level: 254.69
The QQQ closed at 272.48. The QQQ closed .62 higher on the day.
The objective should be up to 275. Support should be at 270.31.
The upper band is now 279.84.
Technical support is around 271.
IWM:
Major level: 162.50
Minor level: 160.94
Minor level: 157.81 **
Major level: 156.25 HIT
Minor level: 154.70
Minor level: 151.56
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
The IWM closed at 157.19. The next minor level is 157.81. Two closes above this level and the IWM should head up to 162.50.
156.25 should be support. And 154.70 as well.
And support should be at the midband, which is 145.98. The IWM is moving away from the midband. Next target should be the upper band, which is 187.
The IWM pulled back the upper band on the 60-minute chart, which is 161.72.
Short term the IWM is overbought and pullback should be coming. We may wee a bit more of a pullback before it makes another run at the upper band.
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 HIT
Minor level: 164.85
Minor level: 163.28
Major level: 162.50 <
Minor level: 161.72
Minor level: 160.16
The TLT closed at 163.82, closing 1.77 lower. The TLT already hit the 165.63 level.
Watch the major 162.50 level. If this level cannot hold, I would expect more selling pressure.
164.85 should be resistance.
The 166 to 167 area is technical resistance.
GLD:
Minor level: 194.54
Major level: 193.76
Minor level: 192.98
Minor level: 191.41
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 183.33. The GLD closed $4.24 higher on the day.
The GLD has now closed under the upper band, which is 186.07. This level should be resistance now.
But, I do expect a test of the upper band at some point. Watch the upper band today.
181.25 should offer support.
The 175 area should offer support. And technical resistance is around 182.
XLE:
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: 34.37
Minor level: 33.59
Minor level: 32.03
Major level: 31.25
The XLE closed at 37.83. The XLE is holding the major 37.50 level. Watch this level today. If it can't hold, I would expect a pullback.
37.50 should be support. And technical support is around 37 as well.
AAPL:
Major level: 400.00
Minor level: 396.88
Minor level: 390.63
Major level: 387.50
Minor level: 384.38
Minor level: 378.13 **
Major level: 375.00 <
Minor level: 371.88
Minor level: 365.63
Major level: 362.50
Minor level: 359.38
Minor level: 353.13
Major level: 350.00
Minor level: 346.88
Apple closed at 460.04. Apple closed $8.00 higher.
This put Apple back above the upper band, which is 439.73. This should be support until a close under it.
By clearing the upper band, it should now be support.
I would like to see a larger pullback before entering.
WATCH LIST:
Bullish Stocks: AMZN, CHTRM NTES, NVDA, AAPL, ROP, DXCM, HUM, COST, MA, W INTU, WST, HD, FB, BABA, KLSC, CMI, PYPL, ITW
Bearish Stocks: STZ, CDW, BAX, HAE, RL, VLO, BX, HQY, MU, WDC, HFC, FL, CLR