Overdue for a higher close

Last night I said there were two numbers to watch today in ES: 1301 on the upside (good) and 1291 on the downside (bad).  Well we never even came close to 1301 and ES did make two stabs down to 1291 in the morning, both of which were rejected at exactly that level.  But they say the third time's the charm and at 1:30 PM the 1291 support was effectively punctured and ES never looked back.

The Dow in the meantime dropped another 61 points for four straight losing sessions and five straight losing weeks, now plus one day.  But the factors I mentioned yesterday about the technical indicators being oversold in both the ES and the Dow remain true today, only now even more so.  And the VIX formed a hanging man candle today.

And right now, at 1:15 AM EDT all three futures are actually up for a change, with ES up 0.14%.  It's not much, but at this point I'll take anything I can get.  The important number here for tomorrow is now 1289, tomorrow's daily pivot.  If we can break above that number, then we have a good chance of closing higher.  Lord knows we're overdue for at least a rally attempt.  We'll have to see if the contrarians come out to play on Tuesday

And I'm waiting for any sort of rally to exit some more of my long positions, because I still see nothing to change my longer term view that the market, and the entire country is in for some tough times later this year (see my post earlier today on "Is the next recession imminent?")  There is no reason to believe that a higher close tomorrow suggests the start of an uptrend.  I'm usually an optimist, but I see nothing to cheer about here whatsoever.

Sadly, there's absolutely no indication of a rally coming from looking at the Dow daily chart.  That last Wednesday's crushing drop was not only not followed by any sort of bounce but actually three more days of solid declines bodes poorly for the Dow.  And these last three days form a "bearish identical three crows" candlestick pattern.  This is all indicative of growing panic.
If there is to be any turnaround tomorrow, it will have to come from the indicators, the VIX, and the reversal we're starting to see in the overnight ES trade. .I think we have a shot at it.  If ES can't break over 1289 and the Dow breaks 12,000 (only 90 points away now) then it's look out below.

Trades

Today I sold some NLY and NCZ.  NLY is looking overbought and NCZ was just some profit taking.