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 two days of minor pullbacks, the market reversed back to the upside. For the day, the S & P 500 closed 11.80 points higher.
It closed out the day at 2,891.64.
The low for the day was 2,881.99, which was just above the minor support level of 2,880.90, I mentioned yesterday.
And the close was just above the major 2,890.60 level.
So, for the day, our predetermined levels impacted the market.
But, the S & P 500 is hanging around the major 2,890.60 level and has now only run back up two levels.
This does make me concerned that we may see some more selling pressure.
In fact, in looking at how the weekly price bar is shaping up, we see that the market has essentially made no movement this week.
The week opened at 2,885.83 and yesterday's close was 2,891.64. So, as of yesterday, the close was within 6 points of the open.
And the range for the week is only 20.56 points.
So, we have a weekly price bar that is shaping up to be a narrow range doji.
This does tell us that an expansion should be coming. Most likely, next week we will see that.
For today, there are two key weekly levels to monitor. The first is the midpoint which is 2,892. And the second is yesterday's close which is 2,891.64. So essentially, we have a very strong level at yesterday's close.
The other level to watch is 2,889 which is the resistance level from yesterday's daily price bar.
There is a lot of confluence in the 2,889 to 2,892 area.
Pre open, the S & P 500 is trading about 7 points lower. This suggests that the market should open around 2,885. The open should be under these levels, so watch to see how the market reacts if it rallies to the support levels.
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 15.82. To move higher, the VIX will still need two closes above 16.41 to move higher. And the VIX still has not closed above it.
Yesterday's low came in at 15.61, just two cents under the level we have been monitoring. As you know, 15.63 is a key level for the VIX.
Continue to see if this level can hold as support.
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.
As I mentioned yesterday, I expected this level to be tested and the market ended up closing right on the line.
At this point, the market should open under it, so watch how the S & P 500 reacts on a test.
Technical support should be in the 2,860 area.
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 183.42. At this point, the objective is to 187.50.
181.25 should still be support. And 178.13 should offer strong support. And minor support should be at 182.03. These levels should still be valid.
Technical support is at 181.
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 153.07. A close today above 151.56 and the IWM should test 156.25.
But, as you know, the midband is right at the 156.25 level. This should be resistance until it is violated.
150 should be strong support. Minor support is at 150.78.
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 131.13. The TLT closed just above the upper band which is now 131.07.
The TLT is overbought but wait for a strong close under the upper band before shorting.
130.86 is minor support.
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 126.60. A close today above 126.56 implies the GLD could make a strong move.
125 should offer support, so if the GLD breaks under it, I would expect more movement to the downside. If this should happen, watch the 123.44 level.
Two closes under 123.44 would suggest a drop to 119.
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 61.41. The XLE should test 62.50. A close today above 60.16 would confirm a move up to 62.50.
60.94 should offer minor support.
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 194.15. At this point, I do expect a test of 200.
But, watch the 193.75 level. If Apple breaks under it, it could drop down to 187.
200 is a key level for Apple. If it does take out 200, it should move up to 250.
Same scenario as yesterday.
WATCH LIST:
Bullish Stocks: LMT, SHOP, MA, LLL, COST, MLM, APD, MCD, CME, SAGE, V, CB, WIX, HSY, RACE, DG, IR, FIS, LLY
Bearish Stocks: GOOGL, FANG, APC, COP, WUBA, DDS, XEC, KSS, WDC, SINA, CNQ
Be sure to check earnings release dates.
