July 13, 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.

The short $7.50 call on CLVS expired on Friday. I will look to sell more calls this week. At this point, the premium collected on the position comes to around 11% of the purchase price.

I also suggested you close the debit spread on CME. The options selected were short-dated and expired this Friday, so it is best to not wait until the last week of expiration. By doing this, you should have closed with a small loss on the position.

The S & P 500 closed the week out at 3,185.04. Friday closed 32.99 points higher.

The intra day range was 50.60 points. This was less than the daily average true range, which is now 57.98 points. But, the daily average range is reducing.

And the day closed out at 96% of the range for the day. This does suggest we will see follow through to the upside today, with the odds favoring Friday's high being violated before the low.

And pre open, the S & P is trading about 21 points higher. This projects to an open around 3,206 or about 19 points above the high from Friday, which was 3,186.82.

Watch for support at Friday's high on a pullback.

The weekly price bar closed 55.03 points higher.

And the weekly price bar had a contraction. The range for the week was only 71.12 points, which was 42.8% of the range of the weekly average true range, which was 166.13 points.

The weekly price bar did close at 97.5% of the range for the week. Like Friday's daily price bar, this suggests that the high should be violated before the low. And the pre-market trading should accomplish that objective at the open.

The support from this week's weekly price bar is in the 3,170 area. Under that level, there is support around 3,150.

This week begins earnings season.

Tomorrow, before the open, we get earnings from a few of the large banks, including C, JPM, and WFC.

Wednesday before the open, we hear from GS and BK.

Thursday morning, we get earnings from BAC and DPZ., along with MS.

And Thursday, after the close we get earnings from NFLX.

Here are the Key Levels for the Markets:

$VIX:

Major level: 37.50
Minor level: 36.72
Minor level: 35.16
Major level: 34.38
Minor level: 33.60
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

The VIX closed at 27.29. It closed 1.97 lower on the day.

The VIX broke under the minor 28.91 level, and had its first close under 27.35. A close today under 27.35 would suggest the VIX should drop to 25.

Technical resistance is around 28.50. The 60 minute chart is still bullish, but is close to crossing into a downtrend. If the 60 minute does cross into a downtrend, it would suggest the market will continue higher.

S & P 500:

Major level: 3,281.20
Minor level: 3,242.15
Minor level: 3,164.00 **
Major level: 3,125.00 < Hit
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
Major level: 2,812.50
Minor level: 2,773.45
Minor level: 2,695.35
Major level: 2,656.30

The S & P closed at 3,185.04. This put the S & P back above the minor 3,164 level.

A close today above this level and the S & P should test 3,281. And 3,164 should be support.

3,145 is also a minor level. 3,160 is also a technical support level.

QQQ:

Major level: 268.75
Minor level: 267.18
Minor level: 264.05 **
Major level: 262.50 < Hit
Minor level: 260.93
Minor level: 257.80
Major level: 256.25
Minor level: 254.69
Minor level: 251.56
Major level: 250.00
Minor level: 248.54
Minor level: 245.31
Major level: 243.75

The QQQ closed at 263.97. The QQQ managed to close for the second day above the 262.50 level.

Watch the minor 264.05 level. Two closes above this level and the QQQ should test 268.75

The 262.50 level should be support. And the 262 area should be support from Friday's daily bar.

Technical support is also around 260.

IWM:

Major level: 156.25
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 < Hit
Minor level: 135.94
Minor level: 132.81
Major level: 131.25

The IWM closed at 141.31. If the IWM can close above 139.06 today, it should test 143.75

Technical resistance is now around 141. If the IWM can clear this level, look for it to become support. And a push higher for the IWM. Watch the 138 area for possible technical support.

TLT:

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
Minor level: 158.60
Minor level: 157.03
Major level: 156.25
Minor level: 155.47

The TLT closed at 166.33. The TLT closed back under the minor 166.41 level. It will still need two closes above 166.41 to test 168.75.

165.63 should now be support. Watch this level. A break under
his level and the TLT should head lower.

GLD:

Major level: 171.89
Minor level: 171.11
Minor level: 169.54 **
Major level: 168.75 < HIT
Minor level: 167.98
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

The GLD closed at 169.19. The objective for the GLD should be up to 171.89.

The minor 167.98 level should be support.

Technical support should still be at 168.

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 35.54 With a close today above the minor 35.15 level, the XLE should test 37.50.

To move higher, the XLE will need two closes above 35.15.

Watch for a move up to the 36 area. If the XLE can clear this level, it should head higher.

The 34 area should be technical support.

AAPL:

Major level: 387.50 < Hit
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
Minor level: 340.63
Major level: 337.50

Apple closed at 383.68. The 378 area should provide support.

And technical support is around 380.

WATCH LIST:

Bullish Stocks: AMZN, TSLA, GOOGL, SHOP, REGN, NFLX, NTES, ADBE, DXCM, NVDA, DPZ, AAPL, LRCX, COUP, VRTX, WIX

Bearish Stocks: ORLY, LMT, MA, NOC, CTAS, ULTA, MCD, BURL, SYK, MMM, AAP, ZBH, IBM, HS, CVXADS, FTDR, FANG, DIN, AJRD, FUN, HFC