Actionable ideas for the busy trader delivered daily right up front
- Tuesday higher, low confidence, waiting on economic news.
- ES pivot 1240.58 Holding under is bearish.
- Rest of week bias higher, on technicals.
- Monthly outlook: bias up, on technicals.
- ES Fantasy Trader went long at 1236.25...
Bump. Last night I warned everyone to get ready for a bumpy week. Today saw the first bump in the form of a 163 point jolt to the Dow. I was right about the bias lower but wrong about the doji. With some Fed news coming out on Tuesday, get ready for another bump. Let's try to see if it will be up or down.
The technicals
The Dow: Two good things about today's big drop: first, the 12K support level held at the close, and second, the 200 day MA held too. Look at how well that works: the 200 MA is 11,944 and the low for the day was 11,941. That's good enough for me. Also, the indicators have now exited overbought territory and are now all headed back down.
We now seem to have something of a trading range going on lately between 12K and 12,200. And since we closed today at the bottom of that range with two intact support levels close at hand, on that basis alone I'd look for a move higher tomorrow.
Market index futures: Tonight at 2:30 AM EST all three futures are just barely in the green in an overnight session characterized by unusual volatility. Traders are apparently reacting to every little item coming in over the news wires and trying to position themselves ahead of tomorrow's FOMC.
And the winner is...
Well tonight I'm going to flip a coin and say the bulls take it. Basically, I expect Tuesdays economic news to come in BTE and I can't imagine the Fed saying anything to pour cold water on the campfire. Then there's the strong historical positive bias to this week. And with at least some technical support from the Dow, there you have it. Tuesday's going higher, but I'm not really all that confident in saying that. If I was in Vegas at the blackjack table right now, I wouldn't be walking away but I'd only put down the minimum bet. That's all she wrote.
ES Fantasy Trader
Today we made no trades. Portfolio stats: the account remains at $146,750 after 41 trades (28 wins, 13 losses) since inception on 8/18 with $100K. Reminder: the portfolio will reset to $100K cash on January 1st, to make year-over-year comparisons easier Tonight we go long at 1236.25.
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