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 was the fourth day that traded within the body of the long range candle from last Friday.
And yesterday's bounce brought the S & P 500 to within closing about 3 points of the high of the bearish long range candle.
The market closed out yesterday at 2,924.58. And the high from last Friday was 2,927.01. So, you can see that the market has tested the high.
And is almost above it.
And pre open, the S & P is trading about 17 points higher. This certainly suggests that there will be follow-through today on this bounce ... and that the high from last Friday will be taken out.
Assuming the pre open trading holds up until the open, the market should open around 2,941. This would be above the high of that bearish long range candle, which would now indicate that it would be support. That level again is 2,927.01.
And this would put the S & P to within 30 points of the major 2,968.80 level.
So, in two days, the market has rallied about 150 points.
In looking at the weekly price bar so far, we see that the range for the week through yesterday is 77.45 points.
And even with this push higher, it is still an inside bar. Last week's high was 2,939.08 And yesterday's high was 2,930.50 or about 9 points below it.
But, with the projected open, the S & P should open about 8 points above it.
So, look for support around last week's high of 2,939.
I do want to mention that ULTA reported last night and is trading about $85 lower. This is a drop of 25%. This is one the biggest loves I had seen in a long time off earnings.
Monday is a national holiday here in the United States and all markets will be closed.
Here are the Key Levels for the Markets:
$VIX:
Major level: 25.00
Minor level: 24.22
Minor level: 22.66
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
The VIX closed at 17.88 yesterday. This brings the VIX back down to under the major 18.75 level.
18.75 should be resistance.
17.97 is minor level to watch today. If the VIX can close udner this level, I would expect a drop to 15.63.
SPX:
Minor level: 3,164.08
Major level: 3,125.00
Minor level: 3,085.95
Minor level: 3,007.85
Major level: 2,968.80 <
Minor level: 2,929.73
Minor level: 2,851.58 **
Major level: 2,812.50
Minor level: 2,773.45
Minor level: 2,695.35
Major level: 2,656.30
The S & P 500 closed at 2,924.58 yesterday. The objective at this point should be up to the 2,968 level.
Minor support is at 2905.30 and yesterday's low was 2,905.67.
This level should still be support. With an open above 2,929.70, it should now be support.
QQQ:
Major level: 196.88
Minor level: 196.10
Minor level: 194.53
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
The QQQ closed at 188.92. The next minor level is 189.06. Two closes above this level and the QQQ should move up to 193.75.
Support should be at 187.50.
Like the S & P, look for follow through on this rally.
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 149.11. Yesterday's high came to within 70 cents of the 150 objective we have been looking for.
This should be support after the IWM clears it.
149.44 is minor support. The IWM is close to crossing into an uptrend.
TLT:
Major level: 150.00
Minor level: 148.44
Minor level: 145.31 **
Major level: 143.75 <
Minor level: 142.97
Minor level: 141.41
Major level: 140.63
Minor level: 139.85
Minor level: 138.28
Major level: 137.50
The TLT closed at 147.24. The TLT is still above the upper band on the daily chart.
I would not expect a pullback until the TLT closes under the upper band which is 145.48.
146.88 is a minor support level.
GLD:
Major level: 150.00
Minor level: 148.44
Minor level: 145.31 **
Major level: 143.75 <
Minor level: 142.97
Minor level: 141.41
Major level: 140.63
Minor level: 139.85
Minor level: 138.28
Major level: 137.50
Minor level: 136.72
Minor level: 135.16
The GLD closed at 144.12. The GLD will still need two closes above 145.31 to head up to 150.
Like the TLT, the GLD continues to trade above the upper band.
The upper band is 143.79. Like the TLT, I would not expect a pullback until the GLD drops under the upper band.
XLE:
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: 55.86
Minor level: 55.08
Major level: 54.69
The XLE closed at 57.48. A close above 57.03 and the XLE should test 59.38.
The XLE is still bouncing from its oversold condition. If the XLE clears 57.81, it should be support.
AAPL:
Major level: 225.00
Minor level: 221.88
Minor level: 215.63
Major level: 212.50
Minor level: 209.38 **
Minor level: 203.13
Major level: 200.00 <
Minor level: 196.88
Minor level: 190.63
Major level: 187.50
Minor level: 184.38
Apple closed at 209.01. 206.25 should offer strong support.
And the objective for Apple should be to 212.50.
Ultimately, the target should be to 225.
WATCH LIST:
Bullish Stocks: SHOP, LMT, AMT, NEE, HSY, CCI, KLAC, MDT, WING, SHAK, EA, WEC, MRK, INXN
Bearish Stocks: NFLX, REGN, DOZ, TSLA, CLX, MMM, JAZZ, JNJ, FFIV, PSX, PKI, ALC, SQ
Be sure to check earnings release dates.
