Friday, February 27, 2015

Friday lower

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Friday lower.
  • ES pivot 2108.75.  Holding below is bearish.
  • Next week bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ - no sell signal yet..
Recap

My conditional call last night worked again.  Note how ES was hugging its new pivot just after midnight.  It then mostly stayed above until 8:40 AM.  Then it made two failed attempts to break back above at 9:35 AM and again at 11:05 AM.  And that was that.  ES was never able to cross the pivot after mid-morning and so we closed lower.  (I'm not considering the Nasdaq which is really off doing its own thing somewhere).  So we move on once again to wrap up the week and the month.

The technicals

The Dow:  The Dow, for the third day in a row failed to extend its gains past 18,225.  And indeed we continue to get reversal signs, this time in the form of a red hanging man/almost star that traded just barely outside the rising RTC for a bearish setup.  With indicators remaining highly overbought, I still think the next move here is lower.

The VIX:  Last night I wrote "this could move higher Thursday" and it did, confirming Wednesday's hammer with a 0.51% gain, though on an inverted hammer.  We remain in a descending RTC but we're also highly oversold so this chart being massively conflicted is too tough for me tonight.

Market index futures: Tonight, all three futures are lower at 12:13 AM EST with ES down 0.12%  On Thursday ES put in a classic star but below Wednesday's spinning top which itself marked a high.  It also fell just on the edge of the rising RTC for a bearish setup.  And the overnight is now outside that for a bearish trigger so with the indicators still well overbought and having clearly topped, this chart looks lower.

ES daily pivot: Tonight the ES daily pivot dips again from 2111.75  to 2108.75. That now leaves ES below the new pivot so this indicator turns bearish.

Dollar index:  The dollar had a massive (and completely unexpected, by me anyway) 1.17% pop on Thursday to hit the upper BB gong in a big way with a giant green marubozu.  That sent RSI overbought but the other indicators have not yet topped.   So we need to see if the dollar has the chops to capitalize on this advance (and it has shown the ability to do so in the past few months) or if it will bounce off the upper BB and head lower.  No call on this one.

Euro:  Whew - I blew this one badly.  I though we were going higher but instead the euro took its biggest dump since January 22nd on Thursday to close at 1.1199, below its lower BB and just above its YTD support at 1.1152.  Backing out the descending RTC and I'm updating my call for euro-dollar parity to September 1, 2015.  Meanwhile, I see no short-term upside here either.

Transportation:  Unlike the Dow's tiny decline, the trans dove 0.54% Thursday to exit their rising RTC for a bearish setup and cause a bearish stochastic crossover.  With indicators still overbought this all adds up to lower on Friday.

Accuracy: 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   6      4       5           3       0.692    183


     And the winner is...

The overall look of things has now turned somewhat bearish and the last day of February is historically pretty weak, so I'm going to go ahead and call Friday lower.  That's all she wrote.  See you again Sunday night!

Single Stock Trader

I was a little disappointed in VZ's inability to make much headway on Thursday despite putting in a green bullish engulfing candle so I reluctantly cut it free at 49.39, making a bit of money in the process.  It's not really a sell yet at this point.  I'm just worried about it getting dragged down along with the rest of the market on a down day.

Thursday, February 26, 2015

Thursday depends on ES pivot

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Thursday higher only if ES remains above its pivot, else lower.
  • ES pivot 2111.75.  Holding above is bullish.
  • Friday bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ a hold.
Recap

As sometimes happens, events conspired on Wednesday to put me way behind,  Accordingly, tonight is a Night Owl Lite - just conclusions, no blab.

The technicals

The Dow:  Still overbought, still in a rising RTC.  A spinning top might be a reversal but needs confirmation.

The VIX:  Rose Wednesday on bearish divergence.  A tall doji nearly hit the lower BB.  With oversold indicators, this could move higher Thursday.

Market index futures: Tonight, all three futures are higher at 12:18 AM EST with ES up  0.09%.  A fat red spinning top Wednesday suggests indecision and possible topping.  Little clarity from the overnight.  Indicators continue overbought.

ES daily pivot: Tonight the ES daily pivot rises again from 2110.75 to 2111.75. Barely above new pivot so nominally bullish.

Dollar index:  Big gap down offers bearish confirmation of a hanging man and inverted hammer.  Bearish stochastic crossover too - looks bearish again Thursday.

Euro:  Tuesday's doji confirmed with a green candle.  Positive follow through in the overnight suggests more upside Thursday.

Transportation:  More bearish divergence - fell while the Dow rose.  Near bearish engulfing candle sent the indicators lower.   Looks bearish.

Accuracy: 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   6      4       5           2       0.667    183


     And the winner is...

The overall look tonight is bearish but ES isn't participating.  Because of its proximity to the pivot, I['ll make it a conditional call.  IF ES remains above its pivot by mid-morning Thursday we close higher, else lower.

Single Stock Trader

VZ little changed.  200 day MA should provide support.

Wednesday, February 25, 2015

Wednesday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Wednesday uncertain.
  • ES pivot 2110.75.  Holding above is bullish.
  • Rest of week bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ remains a swing trade buy.
Recap

Well whadaya know about that?  Last night I went out on a limb calling Tuesday higher - but sometimes my best calls come from that location as the Dow gained a respectable 92 points on Tuesday.  Alrightee then.  So now we plod on to Wednesday as the bleary month of February winds down.

The technicals

The Dow:  On Tuesday the Dow convincingly rejected Monday's hanging man (that's why you generally need confirmation for these candles no matter how tempting they look) to hit yet another record close and remain in a rising RTC even as the upper BB continues to scoot away, now at 18,400.  So tonight there aren't any bearish signs here.

The VIX:  Last night I wrote "I'm going to guess there's more downside available here.".  God guess because the VIX lost another 6% on Tuesday crashing right through its 200 day MA with a tall red marubozu.  The VIX is now in full-on sell-off mode in a steep descending RTC with no end in sight and the lower BB still a ways from here at 12.92.  So we can't call a reversal just yet.

Market index futures: Tonight, all three futures are a bit lower at 12:22 AM EST with ES down 0.04%.  Like the Dow, ES on Tuesday rejected Monday's reversal candle by continuing higher.  There's nothing bearish in the candle but ES has been prone to pausing after one day moves higher lately and I note the indicators are continuing to drift slowly lower while remaining overbought.  So I'm a bit cautious here.

ES daily pivot: Tonight the ES daily pivot rises again from 2104.92 to 2110.75. And once again we remain above the new pivot so this indicator continues bullish.

Dollar index:  Last night I wrote of the dollar "there's at least a suggestion of a move lower here on Tuesday.".  And it wasn't a bad suggestion as the dollar dropped 0.10% on an inverted hammer after a failed attempt to break three day resistance.   But there's an interesting pattern going on YTD - we're forming a symmetrical triangle and it's very close to completion.  Having entered from below I'd guess the dollar is due for a breakout pretty soon - maybe sometime this week.

Euro:  On Tuesday the euro surprised me by putting in its first higher high in seven sessions. It was a small move though and I'll need to see more than this to declare the current downtrend over.

Transportation:  The trans chart on Tuesday looked just like the Dow so my comments there apply here too - nothing bearish.

Accuracy: 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   6      4       4           2       0.667    183


     And the winner is...

The last week of February is historically not so hot.  My predicament here is that while we remain in an uptrend and I don't see any particularly bearish signs on the daily time frame I still see some toppishness on a slightly longer interval as I mentioned a few days ago.  I'm reluctant to call the market higher on that basis but have no real grounds to call it lower so once again I guess that adds up to Wednesday uncertain.

Single Stock Trader

Last night I wrote that for VZ "
the overall bullish thesis remains intact".  And that was that, Jack as VZ gained nearly a percent on Tuesday.  If anything, it looks even better now, with a bullish engulfing pattern, a completed bullish stochastic crossover, a bullish trigger on a descending RTC exit, RSI still oversold but with a bottom in, and a 200 day MA breakout.  What's not to like?  I'm back in at 49.22.

Tuesday, February 24, 2015

Tuesday higher

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Tuesday higher....
  • ES pivot 2104.92.  Holding above is bullish.
  • Rest of week bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ remains a swing trade buy.
Recap

Last night I called Monday as uncertain, adding "My personal bias is that I'm not looking to go long the next few days.".  Well with a meager 24 point move in the Dow, "uncertain" seems about right, and with the move to the downside, not going long seems about right too.  So let's see if we can get any action going here on Tuesday.  Chart 'em up, Jack!

The technicals

The Dow:  We got a good reversal warning in the form of a red hanging man from the Dow on Monday.  It also closed just outside its rising RTC for a bearish setup and remains overbought.  That all makes this chart look lower for Tuesday.

The VIX:  Last night I said the VIX looked lower and while the candle on Monday was indeed red, we ended with a 1.82% gain to close just under the 200 day MA after an attempt to break above.  The result is a bearish harami but the indicators all remain quite oversold.  With four red candles in a row though  and remaining below the 200 MA I'm going to guess there's more downside available here.

Market index futures: Tonight, all three futures are barely higher at 12:57 AM EST with ES up just two ticks.  ES put in a narrow doji star on Monday right at the top of Friday's pop.  Indicators remain quite overbought so this is a good reversal warning - but one which requires confirmation.

ES daily pivot: Tonight the ES daily pivot rises again from 2099.33 to 2104.92. We remain above the new pivot so this indicator continues bullish.

Dollar index:  The dollar gained 0.34% on Monday but on a red hanging man near the top of Friday's candle.  The indicators remain confused but there's at least a suggestion of a move lower here on Tuesday.

Euro:  And the euro continued its long string of dojis with a lopsided spinning top.  This all indicates indecision except for the fact that each doji is lower than the one before.  It's a tiny little beginners slope descent but the trend is nevertheless still lower.

Transportation:  On Monday the trans eked out a 0.14% gain with a green spinning top above Friday's big push.  But with indicators now at extreme overbought levels, a bearish RTC exit, and the stochastic actually on the decline for four days, I'd say this one looks lower on Tuesday.

Accuracy: 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   5      4       4           2       0.636     91


     And the winner is...

Despite some highly overbought conditions and my expectation of a top soon, I'm starting to feel like a tape fighter here and that's never a good thing.  So with the VIX moving back under its 200 day MA and ES seeming to show no signs of wanting to move lower, I'm going to go out on a limb and just call Tuesday higher.

Single Stock Trader

VZ lost a bit of ground on Monday but the overall bullish thesis remains intact with two hammers in a row, extremely oversold indicators and a stochastic about to form a  bullish crossover.

Monday, February 23, 2015

Monday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Monday uncertain....
  • ES pivot 2099.33.  Holding above is bullish.
  • Rest of week bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ a swing trade buy.
Recap

In a good example of how news trumps technicals, on Friday we got some positive news about those Greeks and their perpetual money troubles and so the markets jumped.  Not that I'm  complaining since I'm always net long.  As long as I'm making money I'm happy.  So let's see how happy I'm going to be Monday at 4 PM as we begin the last week of the miserable month of February.

The technicals

The Dow:  Last week I thought for sure the Dow would break lower following a whole week of hanging men.  But the Greeks put the kaiboash on that idea and up we went to the tune of 155 points for another record close and reclaiming the 18K level.  Indicators are all now overbought-broken and have lost their predictive power so all I can really see here is the upper BB at 18,296 and the rising RTC.  IOW - nothing bearish here.

The VIX:  The VIX is now back in gear, falling when the market rises.  And on Friday it fell a good 6.47% out of its rising RTC for a bearish trigger and then right on through its 200 day MA leaving us with three black crows all cawing "lower lower".

Market index futures: Tonight, all three futures are mixed at 12:31 AM EST with ES down 0.05%.  On Friday ES smashed through resistance at 2098 to move back into record territory.  The indicators remain highly overbought but ES has shown an ability for over a year now to keep that up for a long time before moving lower.  That leaves nothing really to call this chart lower Monday.

ES daily pivot: Tonight the ES daily pivot rises from 2094.00 to 2099.33. We're still above the new pivot so this indicator continues bullish.

Dollar index:  After early gains Friday the dollar ended with a 0.16% loss on a red bearish engulfing pattern.  It does appear to me that after peaking on January 23rd the dollar seems to have lost its way.  I'm looking for some directionless trading the next day or so.

Euro:  The euro is also befuddled, putting in five dojis in a row with no end in sight.  Indicators continue to wander between overbought and oversold so to be honest I have no clue where this chart is going.

Transportation:  After a gravestone doji Thursday the trans motored higher on Friday anyway, though with a hanging man this time.  We've now touched the upper BB and the indicators remain extremely overbought, and we're hanging on the very edge of the rising RTC for a bearish setup.  So it looks like there's at least a chance of a move lower on Monday.

Accuracy: 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   5      4       3           2       0.636     91


     And the winner is...

One thing that concerns me is that the Morningstar Market Fair Value Index has now hit 1.06 - its highest level in a year.  The last time we hit 1.06 was December 26th and that marked the exact top of a nasty week and a half long slide.  And the chart recently are looking a lot like the run-up to the December high too (modulo the Greek pop on Friday which might be a one-off).

So I'm kind of torn between calling the market higher because of the absence of any outright bearish signs and calling it lower because of some slightly longer term toppishness I see.  Oh well, what the heck - I'll just split the difference and call Monday uncertain.  My personal bias is that I'm not looking to go long the next few days.

Single Stock Trader

Last Thursday I wrote that "
we're nearing a short-term bottom" regarding VZ.  And if you check the chart, that's about how it played out with a tall green hammer and oversold indicators .  It's now looking like a near term buy again.

Friday, February 20, 2015

Friday lower

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Friday \lower...
  • ES pivot 2094.00.  Holding above is bullish.
  • Next week bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ bottoming soon.
Recap

Well the conditional call last night simply did not work out.  ES broke over its pivot on Thursday but due to bad economic numbers, those freakin' Greeks, or whatever, we ended lower anyway.  It's still a good play, just not 100%.  So with that excitement out of the way, let's take a gander at op-ex Friday, always a good time.

The technicals

The Dow:  On Thursday the Dow lost 44 points on a second hanging man in a row and one that closed outside the rising RTC for a bearish setup  We now have three hanging men in a row making me think Mr. Market is trying to tell us something.  And with indicators remaining overbought, it looks like what he's saying is that there's more downside to come.

The VIX:  In continuing divergence, on Thursday the VIX lost 1.04% on a day the Dow was also down.  It also caused a bearish RTC setup.  The overall gestalt of this chart makes it look like it just wants to move lower.

Market index futures: Tonight, all three futures are mixed once again just like last night at 12:30 AM EST with ES down 0.05% but NQ up 0.04%  ES is clearly having trouble advancing from these elevated levels with now three dojis in a row marking failed attempts to move higher.  RSI hit 98.61 on Thursday, the other indicators have actually begun to move lower, and we got a bearish trigger on the rising RTC exit.  The blah overnight suggests little appetite for any push higher on Friday.

ES daily pivot: Tonight the ES daily pivot dips from 2094.17 to 2094.00 even. After crossing the pivot multiple times on Thursday we're now just barely above the new number, so this indicator is slightly positive.

Dollar index:  Last night I wrote "this one looks vaguely bullish".  Turns out I could have been more assertive since the dollar gained a fair 0.25% on Thursday.  Now it was with a gap-up hanging man.  OTOH, we have a stochastic on the verge of a bullish crossover.  That all leaves this chart too tough to call once again.

Euro:  Last night I noted that the euro seemed to be congesting and wrote "I'm going to guess that the break when it comes will be lower.".  Well on Thursday, it was with the euro closing at 1.1368, its lowest lose in four days.  With three lower highs in a row now and indicators still a long way from oversold, I'd say the selling's not over here yet.

Transportation:  On Thursday the trans put in a massive topping indicator in the form of a big gravestone doji that just touched their upper BB before closing right on the edge of the rising RTC, just short of a bearish setup.  We remain highly overbought so I'd have to say the next move is lower form here.

Accuracy: 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   5      3       3           2       0.700    246


     And the winner is...

Friday is op-ex and historically bearish.  And I have to say the charts now seem to be leaning in that direction with the lone exception of the VIX.  However, the past two days the VIX has traded in direct correlation with the market - highly unusual.  So overall it looks like I have to call Friday lower.  That's all, she wrote.  See you again Sunday night!

Single Stock Trader

Last night I wrote "
there's more downside to come here" about VZ.  And there was, down another percent as we gapped down under the 200 day MA.  That also took the indicators off overbought though we remain in a descending RTC.  I think we're nearing a short-term bottom here which would be a good buying opportunity.  But I need to see the reversal first.  So we continue to watch and wait.

Thursday, February 19, 2015

Thursday depends on ES pivot

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Thursday higher only if ES stays above its pivot, else lower...
  • ES pivot 2094.17.  Breaking above is bullish, below is bearish.
  • Friday bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ moving still lower.
Recap

Wow - Wednesday was pure scalper's heaven with Mr. Market bobbing up and down in a series of clearly defined intraday trends as the Fed minutes rippled through the Street.  But for swing trading, it was just a big dud.  I'm glad I called it uncertain as there was no way to figure out last night where this roller coaster was going to stop.  Now let's just see where this week ends up a we move on to Friday.

And oh, I almost forgot - last night was the Night Owl's fifth anniversary.  Five years continuous of my nightly rants.  Doesn't seem like a day over 10.

The technicals

The Dow:  If you just look at the final candle, on Wednesday the Dow handed us a little red hanging man significant only because that makes it two in a row now.  Back to back hanging men are always better than one.  So with a failure to advance past resistance and indicators remaining highly overbought, I have to think the next move is lower here.

The VIX:  How odd.  Tuesday we had the Dow and the VIX both up.  And on Wednesday they were both down - highly unusual.  And the VIX was down a good 2.22% for a bearish engulfing candle.  It's not really the evening star pattern I mentioned last night  but it looks bearish nonetheless.

Market index futures: Tonight, all three futures are mixed at 12:12 AM EST with ES down 0.06% but NQ up 0.04%  ES ended little changed on Wednesday but the candle was a tall dagger that traded outside a steep rising RTC.  Add in highly overbought indicators and that's a good reversal warning for me.  The overnight seems to be confirming that idea too.

ES daily pivot: Tonight the ES daily pivot rises again from 2091.83 to 2094.17. That move leaves ES sitting smack dab on top of the new pivot so we have no guidance here.  Being bullish or bearish will depend on which side of the fence it falls on.

Dollar index:  On Wednesday the dollar gained 0.12% but on a red spinning top.  But it was enough to close outside its descending RTC for a bullish setup.  And with indicators close to oversold, this one looks vaguely bullish (though I'm not 100% convinced).

Euro:  Meanwhile the euro continues to consolidate around 1.1400.  Nothing to see here until the break and no way to tell which way that may be.  >Shrug<  The indicators continue to rise though so I'm going to guess that the break when it comes will be lower.

Transportation:  In a bit of Dow Theoretic bullish divergence, on Wednesday the trans gained 0.40% to make their winning streak six in a row and remain in a rising RTC.  So with the upper BB way far at 9156 there's nothing bearish on this chart.

Accuracy: 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   5      2       3           2       0.778    246


     And the winner is...

The charts are sort of mixed tonight.  The VIX is looking lower, implying a higher market but the futures are guiding lower.  But with ES sitting right on its pivot that makes it a perfect time for another conditional call.  If ES breaks above its pivot by id-morning Thursday, we'll close higher.  If if breaks lower, we'll close lower.

Single Stock Trader

Last night I wrote "
I don't think the selling is over" and it indeed was not as VZ broke down through its 200 day MA to establish a new falling RTC.  With an MA break and indicators all now falling too, I'd say there's more downside to come here.