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- Monday higher, medium confidence
- ES pivot 1249.42. Holding above is bullish.
- Rest of week bias higher if 200 MA breached..
- Monthly outlook: bias up, on politics and technicals.
- ES Fantasy Trader went long at 1253.25.
Last Thursday night I called the market higher as long as the jobs number was BTE. Well unemployment did come in better and the market did rally hard early but then spent the rest of the day giving back all those gains to finish essentially flat. But the whole gestalt of the day didn't really feel all that bearish if you know what I mean.
The technicals
The Dow: The Dow has now spent two days waffling at the top of that big 497 point gain last Wednesday. The good news is that it's retraced none of that. The bad news is that we weren't able to clear the resistance at 12,165. I think that's what Friday's gravestone doji was all about. Still, without any confirmation, it's premature to call that a reversal sign. And we do have not one but two support levels real close below: the 12K psychological level and the 200 day MA at 11,946.
The VIX: The VIX found its own support on Friday, bouncing off its 200 day MA of 25.34. This marked its third day of touching its lower BB and that's fairly unusual. However, the VIX now has some resistance around 28, just above where it closed Friday. Thus it is in kind of a squeeze play that tends to reduce its volatility. Just as cars slow down when two lanes merge into one, this helps to damp down the crazy jumps the VIX has been making of late and that can only be good for the markets, at least for a few days.
Market index futures: This is really the big news on a Sunday night. All three are solidly in the green with ES up 0.76%.at 1:20 AM EST. ES mounted an attack on its 200 day MA on Friday and was repulsed. It appears to be mounting a second charge as I write this. At 1252.75, we a re just under the MA at 1254.68.
The fact that we are continuing higher in ES after two doji days of indecision is quite positive for the markets. And another positive is that OBV has come way down from its mid-November highs. I do note that the stochastic is forming a bearish crossover but I think this is still an artifact of Wednesday's tall green candle.
ES daily pivot: Has now risen to 1249.42 from 1243.42, but with the price continuing to rise we remain above the pivot. That's another positive sign.
And the winner is...
Tonight, it's the bulls. As long as there's no negative news from Europe tomorrow, I'll be looking for a higher close Monday.
ES Fantasy Trader
Friday we took a small profit of 3.75 points. Portfolio stats: the account is now $162,125 after 37 trades (27 wins, 10 losses) since inception on 8/18 with $100K. The portfolio will reset to $100K cash on January 1st, to make year-over-year comparisons easier. Tonight we go long at 1253.25.
SLD 10 ES false DEC11 Futures 1244.00 USD GLOBEX NOV 30 16:47:48
BOT 10 ES false DEC11 Futures 1247.75 USD GLOBEX DEC 2 00:49:20
Posts
Is this not a loss instead of a profit?
ReplyDeleteGreat catch! The profit was correct, I just copied & pasted the wrong line from my trade log for the trade entry. You can tell because my entries are always late at night and my exist are always during the trading day. Here's the complete, correct trade picked from the actual account statement:
ReplyDeleteSymbol Date/Time Exchange Quantity T. Price C. Price Notional Value Comm/Tax Basis Realized P/L MTM P/L Code
ESZ1 2011-12-02, 00:49:19 - 10 1,247.7500 1,243.5000 -623,875.00 -20.10 623,895.10 0.00 -2,125.00 P;O
ESZ1 2011-12-02, 00:49:19 GLOBEX 7 1,247.7500 1,243.5000 -436,712.50 -14.07 436,726.57 0.00 -1,487.50 P;O
ESZ1 2011-12-02, 00:49:20 GLOBEX 3 1,247.7500 1,243.5000 -187,162.50 -6.03 187,168.53 0.00 -637.50 P;O
ESZ1 2011-12-02, 13:25:01 - -10 1,250.0000 1,243.5000 625,000.00 -20.10 -623,895.10 1,084.80 3,250.00 C
Thanks for noticing.