Friday, December 28, 2012

Friday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Friday uncertain, bias lower.
  • ES pivot 1408.42  Holding above is bullish.
  • Next week bias uncertain technically.
  • Monthly outlook: bias uncertain.
  • ES Fantasy Trader closed.
Recap

Thursday was a perfect example of what I mean by "uncertain" as the market got jerked around by more FC rumors and blathering from Professional Politicians.  The day started off level, then the Dow tanked 120 only to recover almost all its losses later in the afternoon.  And by the time all the shouting was over, it was down just 18 points.  Just a perfect example of a market where the technicals count for nothing.

So in view of this, I am again going to skip the usual daily chart review.  There's really no point to it since the market is now completely driven by the fiscal cliff.  With the year about to end, it looks like we'll continue in the  holding pattern I described last night - a slow drift lower until some sort of deal is announced, and then a pop higher.  And if no deal is announced, we're going down.  So basically once again it's simply Friday uncertain but the bias is lower.

Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points

April      7      9      2                    .438
May       10      7      3           2        .632
June       8      6      6           1        .600     632
July      11      2      6           1        .857     917
August     8      6      8           1        .600     -78
September  8      6      5           0        .571     -19 

October    8      5      8           0        .615     208
November   7      5      5           0        .583     135
December   6      3      3           5        .786     496


ES Fantasy Trader

Portfolio stats:  the account remains at $193,500  after 74 trades (58 wins, 16 losses) starting from $100,000 on 1/1/12.  I'm now declaring the ESFT closed for 2012, so these are our final numbers.  We'll start over again with $100,000 on the first of the new year.


 




Thursday, December 27, 2012

Thursday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front


  • Thursday uncertain, bias lower.
  • ES pivot 1416.58.  Holding below is bearish.



  • Rest of week bias uncertain technically.
  • Monthly outlook: bias uncertain.
  • ES Fantasy Trader standing aside.
  •  
    Recap


    Last night I called Wednesday uncertain with a bias lower and that's pretty much what we got with the Dow dropping just 24 points in a lackluster low-volume session as the pros take the week off.  Since there's little point in looking at the daily charts in this type of environment, tonight I'm going to back out and do a quick run-down of the weekly charts.

    The technicals (weekly)

    The Dow: The weekly Dow's not looking so hot.  After two tall inverted hammers, we're apparently getting some confirmation as the current candle is sagging into the red.  It has also now broken out of the weekly rising RTC for a bearish setup.

    The VIX:  After taking a stab at its weekly upper BB last week, the VIX has now closed on it.  This is usually a good sign that a reversal is on the way, though it could take a week or two to develop.  There's currently no sign from the stochastic that it's about to happen.

    Market index futures: With the H3 contract relatively new, there's not much to see here yet.  The futures appear to be drifting higher on a weekly basis, but amid some pronounced indecision, no doubt being buffeted about by every fiscal cliff sound bit out of Washington.  The current candle is the first red weekly one since the middle of November, but again, I wouldn't read too much into this week's action.  All it will take to send ES higher is an announcement from President Boehbama that they have reached a deal, any deal.

    ES daily pivot: There is no weekly pivot, so I'll simply point out that tonight the daily pivot drops from 1420.58 to 1416.58.  We remain below, so that's bearish.

    Dollar index: The dollar seems to have found some decent support at its current levels after putting in a strong bullish hammer last week.  It's now trading entirely outside it's last descending RTC for a bullish trigger.  With oversold indicators, all signs are pointing to more upside on the way for the greenback.

    Euro: The weekly euro is now quite overbought but really not yet showing any signs of topping.  In fact it recently cleared resistance at 1.3135-1.3165.  With an upper BB still out at 1.3356, there's at least a bit more room to run here.

    Transportation: After two weeks of solid gains, the trans look to be running out of gas.  They're trading at their upper weekly BB, have fallen out of their rising RTC for a bearish setup, and their stochastic is about to form a bearish crossover.  I'd say the trans are looking toppy right here.

    Sentiment: Once again it's time for the latest weekly TickerSense Blogger Sentiment Poll.  We continue to track the poll to see how well it performs.  Here's the final cumulative list for this year.
     
    Wk.# Week   % Bullish  % Bearish  NightOwl SPX  Accuracy

      1  1/3        46         21        +     1258   1/1
      2  1/9        56         37        +     1278   2/2
      3  1/17       41         33        +     1289   3/3
      4  1/23       46         32        +     1315   4/4
      5  1/30       48         31        +     1316   5/5
      6  2/6        56         30        +     1345   6/6
      7  2/13       48         31        +     1343   7/7
      8  2/21       44         32        +     1361   8/8
      9  2/27       48         24        +     1366   9/9
     10  3/5        43         26        +     1370  10/10
     11  3/12       46         32        +     1371  11/11
     12  3/19       46         29        +     1404  11/12
     13  3/26       39         29        +     1397  11/13
     14  4/2        42         21        +     1408  11/14
     15  4/9        25         46        -     1398  12/15
     16  4/16       26         48        -     1370  13/16
     17  4/23       30         48        -     1379  14/17
     18  4/30       44         32        +     1403  14/18
     19  5/7        23         50        -     1350  15/19
     20  5/14       32         44        -     1353  16/20
     21  5/21       30         52        -     1295  16/21
     22  5/29       35         42        -     1318  16/22
     23  6/4        32         48        -     1278  16/23
     24  6/11       28         40        -     1326  16/24
     25  6/18       39         26        -     1343  16/25
     26  6/25       38         46        -     1335  16/26
     27  7/2        41         40        -     1362  16/27
     28  7/9        42         38        -     1355  16/28
     29  7/16       44         32        -     1357  16/29
     30  7/23       33         42        -     1363  16/30
     31  7/30       43         22        +     1386  17/31
     32  8/6        52         28        +     1391  18/32
     33  8/13       43         21        +     1406  19/33
     34  8/20       46         31        +     1418  20/34
     35  8/27       39         29        +     1411  21/35
     36  9/4        31         38        +     1407  22/36
     37  9/10       54         29        +     1438  23/37
     38  9/17       63         22        +     1466  23/38
     39  9/24       52         30        +     1460  23/39
     40  10/1       39         39        -     1441  24/40
     41  10/8       52         34        +     1461  24/41
     42  10/15      41         32        -     1429  25/42
     43  10/22      38         41        -     1433  26/43
     44  10/29      36         43        -     1412  27/44
     45  11/5       44         33        -     1414  27/45
     46  11/12      38         46        -     1380  27/46
     47  11/19      52         34        +     1360  28/47
     48  11/26      48         26        +     1409  29/48
     49  12/3       57         21        N     1416 
     50  12/10      46         29        N     1418
     51  12/17      52         28        -     1414
     52  12/26      52         26        +     1430
      
    Again, the SPX number is the closing price of the S&P on the Friday before each new poll comes out.  The "NightOwl" column is how I voted.  Since the poll is for 30 days out, after the first four weeks we're able to see how well we did.  This week we see that my bullish call on 11/26 was right, the S&P now being  higher than then. I'm using the column "Accuracy" to track my calls.  So now with only one week to go in 2012, I'm 29 for 48 or 60%.

    This week we again see little change in sentiment, no doubt reflecting the fact that many people are on vacation. I also changed my vote back to bullish, rejoining the majority based on my readings of the SPX weekly and monthly charts;

    Accuracy (daily calls): 

    Month    right  wrong  no call  conditional  batting   Dow
                                                 average  points

    April      7      9      2                    .438
    May       10      7      3           2        .632
    June       8      6      6           1        .600     632
    July      11      2      6           1        .857     917
    August     8      6      8           1        .600     -78
    September  8      6      5           0        .571     -19 

    October    8      5      8           0        .615     208
    November   7      5      5           0        .583     135
    December   6      3      2           5        .786     496 


         And the winner is...

    The weekly bias is basically negative, and that seems to match up with the daily mood.  I think what I said last night still holds true - watch for the market to drift lower these last few days of 2012, unless there's an announcement of an FC deal.  If there is, we go higher.  If we get to the 31st and there's no deal at all, load up on the shorts.  So tonight I'm making the same call as last night: Thursday uncertain but bias lower.  As for me, I'm pretty much done trading for the year.  I'll have final performance stats next week.


    ES Fantasy Trader

    Portfolio stats:  the accountremains at $193,500  after 74 trades (58 wins, 16 losses) starting from $100,000 on 1/1/12.  Tonight we stand aside again.


    Wednesday, December 26, 2012

    Wednesday uncertain

    The Hoot 
    Actionable ideas for the busy trader delivered daily right up front
    • Wednesday uncertain.
    • ES pivot 1419.50 (H3 contract).
    • Rest of week bias uncertain technically.
    • Monthly outlook: bias uncertain.
    • ES Fantasy Trader standing aside.
    Recap

    SPX, quarterly
    I hope everyone had a wonderful Christmas and that all the good little traders found big boxes of outsized profits under the tree today.  As the year draws to a close, I want to show you a chart provided by the great Colin Twiggs in his excellent IncredibleCharts.com newsletter.  This is the SPX in quarterly bars, something that eSignal does not give me.  Anyway, I found it interesting to see how the SPX has been channeling since November of 1997, hitting nearly identical peaks in November 1999 and November 2007.  And since the last bottom in March 2009, we have been headed generally back up to test the 1550 resistance line for the third time.  From the looks of it, that should happen sometime around July of next year.

    Colin believes that this resistance is unlikely to be broken and looking at this chart, I'd have to say at this point I agree.  What's clear is that we have some early warning here of a possible top this coming summer

    Tonight, once again we forgo the usual chart-by-chart technical analysis because we don't have any fresh charts to look at due to the holiday and the long weekend.  We're also facing a short trading week and the last full week of the year, and no doubt many traders will be taking a vacation around this time.  And finally, the whole fiscal cliff thing is about to hit the wall.

    So far, it's going about as I predicted and I stand by my earlier guess - Emperor Nerobama, who apparently thought so little of the whole issue that he left the continental US entirely, and the Gang of 535 are going to wait until 11:59:59 PM on the 31st before announcing that they have decided to kick the can into 2013, extending the status quo until some time in the first quarter.

    So in view of all of the above, I expect the see a slow drift lower in the market as everyone watches the bus trundle up to the edge of the cliff.  If by some miracle, some real agreement is reached there will be some sort of rally, otherwise I don't really see much driving force to move us higher in the last few remaining days of 2012.  And if we do go over the cliff, then load up on your shorts.  Given all of this, I'm just going to call Wednesday uncertain but with a bias lower. 

    Accuracy (daily calls): 

    Month    right  wrong  no call  conditional  batting   Dow
                                                 average  points

    April      7      9      2                    .438
    May       10      7      3           2        .632
    June       8      6      6           1        .600     632
    July      11      2      6           1        .857     917
    August     8      6      8           1        .600     -78
    September  8      6      5           0        .571     -19 

    October    8      5      8           0        .615     208
    November   7      5      5           0        .583     135
    December   6      3      1           5        .786     496


    ES Fantasy Trader

    Portfolio stats:  the account remains at $193,500  after 74 trades (58 wins, 16 losses) starting from $100,000 on 1/1/12.  Tonight we stand aside.

    Monday, December 24, 2012

    Merry Christmas!

    MERRY CHRISTMAS!


    The Night Owl wishes a merry Christmas, a happy Hannukah, and very Happy New Year to each and every one of my devoted readers  May you all have a safe, happy, and prosperous 2013.  Tell the ones you love that you love them.