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.
CURRENT POSITIONS:
GOGO Long at $19.93
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RRC Long at $9.20
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MFA Long at $4.20
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PRA Long at $16.45
Premium collected $0.40
QRVO Long (2) Oct 16th $120 Put @ $6.50
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The S & P 500 managed to reverse yesterday and close 34.51 points higher. The day closed out at 3,315.57.
And the daily price bar closed at 90% of the range of the bar, which does suggest that the high of 3,320.31 should be violated before the low of 3,270.95.
And the support area from yesterday's daily bar is in the 3,295 area. Above this level is the 3,305 area.
Both these levels should be watched today.
And with the market trading below the weekly levels, 3,341 should be resistance.
Pre open, the market is trading about 5 points higher. This projects to an open around 3,320, or right at yesterday's high. Watch to see if the market can take out the high.
Yesterday's range was only 49.36 points. This was 84% of the daily average true range, which is 58.85.
I would expect we see follow-through today, but there is overhead resistance and I do expect another downswing at some point.
This is because the 60 minute chart has crossed into a downtrend. But, this would be an opportunity to get long as I would expect the bull trend to continue after that pullback.
The resistance level should be right around the midband on the 60 minute chart, which is around the 3,390 level.
This should be resistance as the market approaches it from below. But, we know that if the market can clear it, it should then continue higher.
NKE reported a blow-out quarter and is trading about $14 higher.
Thursday afternoon, we get earnings from COST.
Here are the Key Levels for the Markets:
$VIX:
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
Minor level: 22.66
Major level: 21.88
Minor level: 21.10
The VIX closed at 26.86. For the day, the VIX closed .92 points lower.
The VIX got as high as 28.60 before pulling back. The VIX managed to clear the major 28.13 level, but could not hold it.
At this point, watch the minor 28.13 level on the upside and the 25.78 level on the downside.
The key now will be if the VIX can hold the midband on the daily chart. It closed just above it.
That level is now 26.05. And the VIX is only 81 cents above it.
If the VIX holds support here and heads up, look for that downleg I mentioned, If not, expect a test of the midband for the S & P on the 60 minute chart.
S & P 500:
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
Minor level: 3,085.95
Minor level: 3,007.85
Major level: 2,968.80
The S & P closed at 3,315.57. The S & P got as low as 3,270.95 or about 10 points under the 3,281.20 level before recovering to close about 5 points under the minor 3,320.25 level.
At this point, the S & P would need two closes above 3,320.25 to move up to 3,437.40.
3,281.20 should be support. Watch this level on a pullback. And technical support is around 3,288.
3,390 is the midband on the 60 minute chart and with the S & P trading below it, it should be resistance.
The short term 60 minute has turned bearish.
QQQ:
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
Minor level: 273.44
Minor level: 270.31 **
Major level: 268.75
Minor level: 267.19
Minor level: 264.06
Major level: 262.50
Minor level: 260.94
Minor level: 257.81
Major level: 256.25
The QQQ closed at 272.48. The QQQ closed 4.97 higher.
Watch the 270.31 level. A close today above this level and the QQQ should test 275.
The QQQ broke under the midband on the 60 minute chart. That price level is 277.50 and should now be resistance.
Like the S & P, the QQQ has crossed into a downtrend on its 60 minute chart.
IWM:
Major level: 162.50
Minor level: 160.94
Minor level: 157.81
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
Minor level: 135.94
The IWM closed at 149.06, closing 1.14 higher. Watch to see if the IWM can clear the 150 level.
148.44 should be support. And after 150 level, watch the 151.56 level.
Having said that, the IWM is just above the midband on the daily chart, which is 146.60. This should be support.
154 is the midband on the 60 minute chart.
TLT:
Major level: 171.88
Minor level: 171.10
Minor level: 169.53
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
The TLT closed at 164.27. The 164.85 level is the key short term level. And with a close today under it, the TLT should drop to 162.50.
To move higher, the TLT needs to recoup the 164.85 level. If not, a drop to 162.50 would be expected.
The 165 area is still technical resistance.
Short term charts remain bearish.
GLD:
Major level: 190.63
Minor level: 189.85
Minor level: 188.28
Major level: 187.50
Minor level: 186.72
Minor level: 185.16
Major level: 184.38
Minor level: 183.60
Minor level: 182.03
Major level: 181.25
Minor level: 180.47 **
Minor level: 178.91
Major level: 175.00
The GLD closed at 178.65. The GLD closed .87 lower on the day.
Biased for a drop to 175. Watch this level today. 180.47 should be resistance.
Short term momentum has turned bearish. The technical resistance level is now around 182. If the GLD can clear 182, it should 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: 28.12
The XLE closed at 31.64. The XLE is right at the major 31.25 level. Watch to see if the XLE can hold this level.
Short term the XLE is oversold. It did move above the lower band on the 60 minute chart, which is now 31.90. This should be support on a retest.
Looking for a bounce, which we are getting. Technical support is around 31. Looking for a move up to the 36 area.
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 111.81. Apple managed to close $1.73 higher.
The next level on the upside is 112.50. If Apple can lear this level, it should be support.
Apple broke under the midband on the 60 minute chart. That level is 117 and should be resistance. Apple has crossed into a downtrend on the 60 minute chart. Short term momentum is bearish.
WATCH LIST:
Bullish Stocks: CHTR, ZM, AVGO, FDX, PODD, MCD, DE, DG, UNP, MMM, EDU, CAT, TT, ALXN, GH, Z, ALB, PGR, EMN, PENN, SWAV
Bearish Stocks: BDX, WAT, GS, GD, HSY, CB, TRV, CYBR, MIDD, DLTR, ADC, HSIC, UPRO, KRC, THS, HXL
