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 closed out the month of September. This marks the end of the 3rd quarter of 2019.
The month closed out with a 14.83 point gain. The month closed out at 2,976.73. This put the market back above the major 2,968.80 level.
For the month, the S & P closed 50.27 points higher.
The month closed back above the upper band on the monthly chart. The upper band is 2,965.76, so the S & P managed to close about 9 points back above the upper band.
But, the monthly price bar was an inside bar. It made a lower high and a higher low. Also, the range for the month was 130 points. With a monthly average true range of 162.45, September's range was 80% of the average.
This all adds up to the fact that we do expect an expansion.
So, the key levels to watch will be the close of 2,976.73. The midpoint is 2,956.92 and is also a key level to watch.
Usually, with an inside bar, the price will continue in the direction of the violation of the high or low. The September high was 3,021.99 and the low was 2,891.85.
Monday's daily bar closed at 58% of the range of the bar. This does suggest the odds still favor a violation of the high before the low.
And the support level is in the 2,975 to 2,972 area.
Pre open, the S & P is trading about 5 points higher.
Earnings season should begin in about two weeks.
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 16.39 yesterday. The VIX got as high as 17.35 or about 16 cents above the minor 17.19 resistance level.
At this point, the VIX should test 15.63.
17.19 should still offer minor resistance. And 16.41 is also a minor level to watch.
On the downside, the key level is 14.85. A break under this level and I would expect the VIX to head lower.
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 closed at 2,976.73. With the S & P clearing 2,968.80, it should now be support.
The next minor level is back to the 3,007.85 level. Two closes above it and the S & P should head higher.
2,954 should be support on the downside.
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 188.81. The QQQ will need two closes above 189.06 to move up to 193.75.
187.50 should still be support and yesterday's low was 187.40.
The 190 area should offer technical resistance.
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 151.34. The IWM continues to hold just above the midband, which is 150.54. The low for the day was 150.79.
Watch to see if the IWM can hold the 150 level. It should still offer support.
If the midband cannot hold, I would expect further selling. And if the IWM can clear 151.56, it should head higher.
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
Minor level: 135.84
The TLT closed at 143.08. A retest of 143.75 is the next logical move.
142.19 should offer support. And if it can't, the TLT should drop.
Watch to see if the 140.63 level holds as support.
Still trading in a consolidation range. Watch for a breakout or breakdown.
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 138.87. A close today under 139.85 would suggest a drop to 137.50. And I would expect support at 137.50.
140.63 should still be resistance.
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
The XLE closed at 59.20. The XLE is trading right around the major 59.38 level.
On the downside, support should be at 57.81.
The 60 area should offer technical resistance.
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 223.97. Apple came within 50 cents of the 225 objective.
If Apple can clear 225, it should head higher. 218.75 should now be support.
Apple is overbought in the short term and a pullback would not be out of the question.
WATCH LIST:
Bullish Stocks: MLM, AAPL, NSC, RH, RH, AGN, KLAC, ITW, IBM, UTX, KSU, PG, PSX, NXPI
Bearish Stocks: NFLX, REGN, HUM, UNH, VRTX, MOH, BMRN, GRUB, GDOT, ALKS
Be sure to check earnings release dates.
