November 30, 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.

I added a stock position on Wednesday. The recommendation was to buy EGAN at $11.36.

On Friday, I suggested two trades. The first was to close out the PRA position. Including the call premium collected, the return worked out to 13.7% for just over 3 months.

I also suggested selling the December $19 call on the BOX position on Friday. This brings the call premium collected to $1.20 per share.

If these calls are assigned, the total return will be 14.4%.

The shortened Friday trading session closed 9.04 points higher. The S & P 500 closed out the week at 3,638.69.

And the range for the day was only 14.98 points. This was 30% of the daily average true range, which now reads 50.45 points.

This is why I do not write an update after the Thanksgiving Holiday. Nor do I even bother to try and day trade sessions like this.

A rookie mistake is to try and force trades on a day like that. It goes back to price expectation. And on a shortened session after a holiday, you expect a narrow range day.

And that is what we got.

The S & P closed at 62% of the range of the daily bar.

The key for today will be to watch the high, close, and low.

These levels are 3,644.31, 3,638.69 and 3,629.33 respectively. And watch the midpoint, which is 3,636.82.

Pre open, the S & P is trading about 11 points lower. This projects to an open around 3,627 or about 2 points below Friday's low.

Watch to see if the market can reclaim Friday's low of 3,629.33.

For the week, the S & P closed 81.15 points higher.

And the weekly price bar closed at 92.9% of the range of the weekly price bar. This suggests that the odds favor the high of the weekly bar being violated before the low.

Last week's high was 3,644.31 and the low was 3,552.77.

And the support area from last week's bar is in the 3,598 to 3,603 area.

The projected open should be about 24 points above the upper end of the weekly support range.

Earnings continue this week. CRM reports tomorrow after the close, along with BOX and VEEV.

SNOW and SPLK report Wednesday after the close. CBRL and DG report Thursday before the open.

Thursday after the close, we get earnings from DOCU, RH, and ULTA.

Here are the Key Levels for the Markets:

$VIX:

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
Minor level: 22.66 **
Major level: 21.88 <
Minor level: 21.10 **
Minor level: 19.53
Major level: 18.75

The VIX closed at 20.87. The VIX closed .38 points lower.

The VIX closed under the next minor level, which is 21.10. This now implies that if the VIX can close under this level today, it should drop to 18.75.

24.22 and 22.66 should be resistance.

Technical resistance is around 22.

S & P 500:

Major level: 3,749.80
Minor level: 3,710.75
Minor level: 3,632.65 **
Major level: 3,593.60 <
Minor level: 3,554.55 **
Minor level: 3,476.45
Major level: 3,437.40
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

The S & P closed at 3,638.69. The S & P closed 9.04 points higher. This out the S & P back above the major 3,632.65 level.

Watch this level today. And the minor 3593.60 level, which should be support on a sell off.

3,600 should be technical support. And minor technical support is at 3,628.

QQQ:

Minor level: 301.56
Major level: 300.00 Hit
Minor level: 298.44
Minor level: 295.31 **
Major level: 293.75 <
Minor level: 292.19
Minor level: 289.06
Major level: 287.50
Minor level: 285.94
Minor level: 282.81
Major level: 281.25
Minor level: 279.69
Minor level: 276.56
Major level: 275.00

The QQQ closed at 298.69. The QQQ closed 2.41 higher.

The QQQ did hit the 300 objective. Friday's high was 300.17.

The upper band on the weekly chart is 292.25 and the QQQ is above it. This level should be support.

The 295.31 level should also be minor support.

IWM:

Major level: 187.50
Minor level: 181.25
Minor level: 176.56 **
Major level: 175.00
Minor level: 173.44
Minor level: 170.31
Major level: 168.75
Minor level: 167.19
Minor level: 164.06
Major level: 162.50
Minor level: 160.94
Minor level: 157.81
Major level: 156.25
Minor level: 154.70

The IWM closed at 184.37. The IWM closed .78 higher on the day.

The objective for the IWM should still be to 187.50. 181.25 should be support.

I am looking for a retest of the upper band on the 60 minute chart. That level is 189.

180 should be technical support.

TLT:

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
Minor level: 153.91
Major level: 153.13

The TLT closed at 160.22. It closed 1.54 higher. The TLT managed to close above the 160.16 level.

A close today above the 160.16 level and the TLT should test 162.50.

159.38 should be support.

The TLT is back above the midband on the 60 minute chart. That level now is 159.27.

This level should now be support.

GLD:

Minor level: 182.03
Major level: 181.25
Minor level: 180.47
Minor level: 178.91
Major level: 175.00
Minor level: 174.25
Minor level: 172.70
Major level: 171.88
Minor level: 171.10
Minor level: 169.53
Major level: 168.75
Minor level: 167.97 **

The GLD closed at 167.79. The GLD closed 1.72 lower on the day.

The GLD closed under the 168.75 objective.

The major 171.88 level should be resistance now. And so should 171.10.

The GLD is now oversold. It is right under the lower band on the 60 minute chart. That level is 168.96. The GLD needs to recoup this level to head higher.

XLE:

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
Minor level: 30.47
Minor level: 28.90
Major level: 28.13

The XLE closed at 38.91. The XLE closed .46 lower on the day. The midband on the daily chart is 39.12 and the XLE is trading right at it.

Wait to see if it holds or fails at this level. I do think the XLE will reclaim the midband. And if it can, it should continue higher.

Target should be to 40.63.

Support is at 38.28 and at 39.25.

The XLE did close under the upper band on the 60 minute chart, which is now 40.72. I do expect a retest of this level.

AAPL:

Minor level: 140.63
Major level: 137.50
Minor level: 134.38
Minor level: 128.13
Major level: 125.00
Minor level: 121.88
Minor level: 115.63 **
Major level: 112.50
Minor level: 109.13
Minor level: 103.13
Major level: 100.00

Apple closed at 116.59. Apple closed $.56 higher.

Watch the minor 115.63 level. This level should be support. And if Apple can close above the 115.63 level today, it should move up to 125.

Apple is right at the midband on the 60 minute chart. That level is 116.83. Watch to see if Apple can reclaim this level.

WATCH LIST:

Bullish Stocks: TTD, GOOGL, TSLA, RH, LRCX, ASML, AVGO, COST, ZBRA, PANW, COUP, ADSK, ANET, ULTA, DE, KLAC, GS, URI, TEAM, SQ, V, ITW, HON, AMP, KSU, MCK, CAT

Bearish Stocks: AMT, BIDU, BAX, K, CNC, FE