Tuesday uncertain

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

• Tuesday uncertain.
  
• ES pivot 1835.58.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

That's one of the hazards of forecasting on holiday weeks.  The technicals looked ripe for a fall but the Dow managed to eke out a 0.16% gain on the penultimate day of the year anyway (thought the SPX did decline a bit).  So here we are - the last day of 2013 is upon us.  Once more into the breech, and then we take a day off.  So Happy New Year to one and all and here's wishing you a safe, happy and prosperous 2014!

The technicals (daily)

The Dow: Monday's gain might have only been 26 points, but it was enough to cancel last Friday's star, particularly since we remain in a rising RTC.  Indicators remain pegged on overbought but we've seen all year how that can just go on and on.  So in the absence of any other bearish signs, this chart resumes bullish.

The VIX:  At least I got the VIX right last night when I wrote "this one looks ready to move higher."  And it sure did, with a gap-up green marubozu good for a nearly 9% gain that broke out of the descending RTC for a bullish trigger to go with a completed bullish stochastic crossover.  So with the indicators just barely off oversold, it looks like there's more upside left here.

Market index futures: Tonight all three futures are virtually unchanged at 12:24 AM EST with ES dead flat and YM up a scant 0.02%.  Monday's red spinning top in ES took it outside its rising RTC for a bearish setup.  The new candle will be a bearish trigger unless ES can close above 1845 on Tuesday, which doesn't seem likely.  With resistance at 1837 intact, this chart continues to look like it wants to go lower.

ES daily pivot: Tonight the pivot inches down from 1836.58  to 1835.58.  That still leaves ES below the new pivot so this indicator remains bearish.

Dollar index: On Monday this head-scratcher of a chart gave up all of Friday's gains to finish almost exactly in the same place.  The failure to capitalize on Friday's big move plus indicators now marching lower suggests a lower dollar on Tuesday..

Euro: I did miss the euro though, which moved strongly higher on Monday, not lower.  So while RSI has now entered overbought, the stochastic has only just completed a bullish crossover.  But the euro now faces strong resistance around 1.3805 and is in fact moving lower in the overnight.  So I'm just going to call again for a move lower on Tuesday.

Transportation: Last night I wrote that the technicals "suggests a move lower Monday".  It wasn't a bad suggestion with the trans down just a bit on a nice star.  That makes two dojis in a row now and still leaves us highly overbought and right at the edge of the rising RTC.  This chart continues to look toppy to me.


Accuracy (daily calls):

Month     right wrong  no call  conditional  batting   Dow
                                             average  points
 
January    5      7      6           3        0.533   -101
February   3      4      5           6        0.692    131
March      5      7      5           2        0.500    121
April      7      5      5           3        0.667    328
May        3      4      6           4        0.636     85
June       6      5      6           0        0.545    543
July      10      2      4           4        0.875    486
August    11      3      6           2        0.813    687
September  8      3      3           3        0.800    485
October    7      5      8           2        0.643    674
November   6      6      2           1        0.538    123 December   6      6      4           0        0.500    176

     And the winner is...

While the technicals continue to look bearish, Tuesday is New Year's Eve and I'm sure the big players will have already departed for the Hamptons or their ski chalets in Aspen.  So I'm figuring a slow day which could end either way.  Therefore, I'll just end the year with a call of Tuesday uncertain.    See you again Wednesday night.

ES Fantasy Trader

Portfolio stats:  the ESFT is closed for 2013.  The account ends the year at $110,625 after 17 trades (13 for 17  total, 7 for7 longs, 6 for 10 short) starting from $100,000 on 1/1/13.  We'll reset to $100,000 on New Year's day and start over for 2014.

Monday lower

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

• Monday lower, low confidence.
  
• ES pivot 1836.58.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Ho ho ho!  I hope everyone had a merry Christmas.  We're back and it looks like Santa showed up right on time bringing loads of profits to all the good little traders, the Night Owl among them, having hit her high of the year just last Friday.  With the Santa rally wrapping up, the next obvious question is what of the January effect?  And with a second chopped up holiday week on a row coming up let's see if we can make any sense of it.  Speaking of sense, if I had any, I'd take this week off too.  I'm only here because it's the very end of 2013 and the start of a new year so it seems like I should show up.  So in the waning days of 2013, let's run down the charts once more.

The technicals (daily)

The Dow: It was quite a week for the Dow as it remains solidly inside a rising RTC while it climbs it upper BB.  The indicators are all broken at overbought now (RSI is 99.75).  The only  notes of caution here are the look of an exponential run-up and the doji on Friday suggesting a pause may be coming.  Year-end tax loss selling is also due to kick in (assuming it happens at all this year).  So I'd at least entertain the possibility of a down day here on Monday.

The VIX:  Supporting that notion is the VIX, which on Friday put in a small gain following a doji on Thursday.  It has now found support in the 12 area and bounced off its lower BB.  We also just got a fresh bullish stochastic crossover so this one looks ready to move higher.

Market index futures: Tonight the futures are mixed at 12:25 AM EST with ES down by 0.04% but NQ up by the same amount.  The overnight action is pretty trendless.  But Friday's candle was a perfect star that closed off the upper BB for the first time in five days.  With the indicators majorly overbought and no positive movement in the overnight, there's a suggestion here of a move lower on Monday.

ES daily pivot: Tonight the pivot inches up from 1834.67  to 1836.58.  That was enough to put ES below the new number so this indicator turns bearish.

Dollar index: On Friday the dollar put in one of these funny candles that's a tall green marubozu but still counts as a 0.14% loss because of a big gap down at the open.  These "backwards losses" are always tough to figure, and doubly so in a holiday-shortened week so I'm not touching this chart tonight..

Euro: Friday's euro chart was a bit less conflicted, giving us a tall inverted hammer whose tail pierced the upper BB.  After an attempt to move higher in the Sunday overnight, the euro has now fallen below its pivot and looks to be starting a dark cloud cover.  There's not much of an RTC here and the indicators are of little help but the rest of the evidence suggests a move lower on Monday.

Transportation: The trans, like the Dow are quite overbought now.  And on Friday they put in a hanging man that broke away form the upper BB.  That, plus highly overbought indicators suggests a move lower Monday.


Accuracy (daily calls):

Month     right wrong  no call  conditional  batting   Dow
                                             average  points
 
January    5      7      6           3        0.533   -101
February   3      4      5           6        0.692    131
March      5      7      5           2        0.500    121
April      7      5      5           3        0.667    328
May        3      4      6           4        0.636     85
June       6      5      6           0        0.545    543
July      10      2      4           4        0.875    486
August    11      3      6           2        0.813    687
September  8      3      3           3        0.800    485
October    7      5      8           2        0.643    674
November   6      6      2           1        0.538    123
December   6      5      4           0        0.545    202

     And the winner is...

Though Monday is historically bullish, that may not be the case this year as the charts are looking a bit toppy to me.  In fact, I see enough reversal warnings out there to call Monday lower.  Of course, it's another holiday-shortened week with the holiday in the middle so anything's possible, but that's just how the technicals look.

ES Fantasy Trader

Portfolio stats: I am now calling the ESFT closed for 2013.  The account ends the year at $110,625 after 17 trades (13 for 17  total, 7 for7 longs, 6 for 10 short) starting from $100,000 on 1/1/13.  We'll reset to $100,000 on New Year's day and start over for 2014.

Performance update

Recap

Well technically we're on vacation this whole week, but the performance stats continue to accumulate, so I'll just review those now for the record.  The regular blog resumes this coming Sunday night.

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. 
 

Wk.# Week   % Bullish  % Bearish  NightOwl Poll SPX  Accuracy Poll

  1  12/31      40         48        -      -   1402   0/1

  2  1/7        47         30        +      +   1466   1/2

  3  1/14       52         15        +      +   1472   2/3

  4  1/22       50         21        +      +   1486   3/4

  5  1/28       44         26        +      +   1503   4/5

  6  2/5        40         36        +      +   1513   5/6

  7  2/11       43         25        +      +   1518   6/7

  8  2/19       21         43        -      -   1520   6/8

  9  2/25       30         52        -      -   1516   6/9

 10  3/4        29         39        -      -   1518   6/10

 11  3/11       41         26        +      +   1551   7/11

 12  3/18       41         37        +      +   1561   8/12

 13  3/25       31         38        +      -   1557   8/13    9/13

 14  4/1        38         38        +      x   1569   9/14    9/13

 15  4/8        32         50        -      -   1553   9/15    9/14

 16  4/15       33         50        +      -   1589   10/16   9/15

 17  4/22       19         63        -      -   1555   10/17   9/16

 18  4/29       33         58        -      -   1582   10/18   9/17

 19  5/6        50         31        +      +   1614   11/19  10/18

 20  5/13       37         37        +      x   1634   12/20  10/18

 21  5/20       50         25        +      +   1667   12/21  10/19

 22  5/28       37         33        +      +   1650   12/22  10/20

 23  6/3        29         38        -      -   1631   13/23  11/21

 24  6/10       38         38        +      x   1643   13/24  11/21

 25  6/17       32         40        +      -   1627   14/25  11/22

 26  6/24       13         46        -      -   1592   14/26  11/23

 27  7/1        25         42        -      -   1606   14/27  11/24

 28  7/8        42         29        +      +   1632   15/28  12/25

 29  7/15       48         22        +      +   1680   16/29  13/26

 30  7/22       42         19        +      +   1692   16/30  13/27

 31  7/29       39         17        +      +   1692   16/31  13/28

 32  8/5        46         27        +      +   1710   16/32  13/29

 33  8/12       32         41        -      -   1691   17/33  14/30

 34  8/19       23         54        -      -   1656   17/34  14/31

 35  8/26       23         50        -      -   1664   17/35  14/32

 36  9/3        21         54        -      -   1633   17/36  14/33

 37  9/9        35         30        +      +   1655   18/37  15/34

 38  9/16       40         28        +      +   1688   19/38  16/35

 39 9/23        52         36        +      +   1710   20/39  17/36

 40 9/30        39         43        +      -   1692   21/40  17/37

 41 10/7        30         33        +      -   1691   22/41  17/38

 42 10/14       48         22        +      +   1703   23/42  18/39

 43 10/21       57         30        +      +   1745   24/43  19/40

 44 10/28       59         19        +      +   1760   25/44  20/41

 45 11/4        42         25        +      +   1762   26/45  21/42

 46 11/11       39         39        +      x   1771   27/46  21/42

 47 11/18       52         30        +      +   1798   27/47  21/43

 48 11/25       58         29        +      +   1805   28/48  22/44

 49 12/2        56         26        +      +   1806

 50 12/9        55         30        +      +   1805

 51 12/16       30         43        +      -   1775

 52 12/23       38         29        +      +   1818 

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.  The "Poll" column is how the majority of participants 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 both I and the majority of the poll voted bullish four weeks ago, so we were both wrong.  Therefore the Night Owl continues the year with an accuracy of 28 for 48, or 58%.   And with that final call of 2013 the poll as a whole rises back to break-even at 22 for 44 or 50% - it was a tough year for the poll overall.  In four weeks we'll be able to fill in the remaining blanks for the year and come up with the final numbers.

This week we see that bullish sentiment is up a bit while bearish is down a good 14 points as the majority comes back to join me in the bullish camp.  I am still not seeing any bearish technicals on either the weekly or monthly SPX charts so I continue to vote bullish.


Accuracy (daily calls):

Month     right wrong  no call  conditional  batting   Dow
                                             average  points
 
January    5      7      6           3        0.533   -101
February   3      4      5           6        0.692    131
March      5      7      5           2        0.500    121
April      7      5      5           3        0.667    328
May        3      4      6           4        0.636     85
June       6      5      6           0        0.545    543
July      10      2      4           4        0.875    486
August    11      3      6           2        0.813    687
September  8      3      3           3        0.800    485
October    7      5      8           2        0.643    674
November   6      6      2           1        0.538    123
December   6      5      4           0        0.545    202

On vacation til 12/29 - Merry Christmas!

The Night Owl is on vacation until next Sunday night, December 29th.  I'm not expecting a lot of market action on this holiday-shortened week anyway.  Happy holidays and happy trading!

Friday higher

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

• Friday higher, low confidence.
  
• ES pivot 1801.25.  Holding above is bullish.  (Now running the "H" contract).
• Next week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Ho hum - I'm glad I called Thursday as ":uncertain" because the Dow was up 11 and the SPX was down 1, that's about as uncertain as it gets.  I wrote "I think we could be in for a doji day" and that's what we got.  Since I'm taking a Christmas vacation all next week, this will be my last post until Sunday, December 29th.  I wish all my readers a merry Christmas.  Take some time to be with the ones you love, and tell them you love them, because the time will come when you're no longer able to.  And with that jolly thought, let's hit the charts once again as 2013 grinds to a close.

The technicals (daily)

The Dow: With its small gain, the Dow formed a little spinning top on Thursday.  But not having yet hit the upper BB and with the indicators still not quite to overbought, this reversal indicator require confirmation.  So this chart is too tough to call.

The VIX:  And on Thursday the VIX formed a fat hammer.  But like the Dow, the other confirming factors like indicators and BB's are not present, so we have to take a pass here too.  Thursday's 2.54% gain might simply be a DCB.  I'll also note that the 200 day MA is now directly overhead and with the indicators continuing lower, this lowers the odds of a further rise in the VIX.  We'll see.

Market index futures: Tonight all three futures are higher at 1:18 AM EST with ES up by 0.17%.   On Thursday ES, like just about everything else, put in a doji at the top of Wednesday's big gains.  While the overnight is positive, it still has to break above resistance at 1805.  RSI has just now gone overbought but the stochastic is still a ways from a bearish crossover and the upper BB is now at 1814, so it's not out of the question for ES to move at least a bit higher form here.

ES daily pivot: Tonight the pivot rises from 1790.75  to 1801.25. That still leaves ES above the new pivot so this indicator continues to be bullish. 

Dollar index: On Thursday the dollar gapped up big time, up a monster 0.67% for a bright shining evening star.  The last three times we saw this, the dollar was lower the next day.  And with RSI now officially overbought, I'm thinking that will be the case here too..

Euro: Similarly, the euro gapped down on Thursday and officially went oversold.  But the stochastic isn't yet in position for a bullish crossover and the lower BB is still miles away.  And with the overnight now down another non-trivial 0.16%, it looks like the euro's not done going lower yet.

Transportation: And finally, yet another doji with the trans, down just 0.01% on Thursday.  But it's the same story here too - no overextended indicators or other extremes.  So while this is a reversal warning, it's one that requires confirmation.  I'm not touching this one.


Accuracy (daily calls):

Month     right wrong  no call  conditional  batting   Dow
                                             average  points
 
January    5      7      6           3        0.533   -101
February   3      4      5           6        0.692    131
March      5      7      5           2        0.500    121
April      7      5      5           3        0.667    328
May        3      4      6           4        0.636     85
June       6      5      6           0        0.545    543
July      10      2      4           4        0.875    486
August    11      3      6           2        0.813    687
September  8      3      3           3        0.800    485
October    7      5      8           2        0.643    674
November   6      6      2           1        0.538    123
December   5      5      4           0        0.500    160

     And the winner is...

With all the dojis around tonight the cautious thing would be to simply call Friday uncertain.  But given the lack of outright bearish signs and the fact that we're not really badly overbought yet, I'm going to go waaay out on a limb and call Friday higher.  See you again Sunday after next!

ES Fantasy Trader

Portfolio stats: the account remains at $110,625 after 17 trades (13 for 17  total, 7 for7 longs, 6 for 10 short) starting from $100,000 on 1/1/13.  Tonight we stand aside.again.

Thursday uncertain

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

• Thursday uncertain.
  
• ES pivot 1790.75.  Holding above is bullish.  (Now running the "H" contract).
• Friday bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Holy moly!  The dreaded Taper took place and it turns out Mr. Market liked it.  And boy did he like it - with the Dow blasting up 293 points for its biggest gain in three months and another record high.  And my REIT's participated in the action too giving my my best day since September 18th.  Ho ho ho! Now that that's out of the way, perhaps we can return to the technicals to see where Thursday's headed.

The technicals (daily)

The Dow: You can say it was news driven, but the RTC technique played out perfectly here.  On Monday, the Dow broke out of its descending RTC for a bullish setup.  On Tuesday, it traded entirely outside and that was the trigger.  And of course, Wednesday brought the payoff.  After such a big gain and having nearly touched the upper BB, I'd say that while Thursday's not necessarily looking lower, we probably don't have much upside to go here.

The VIX:  And of course the movement of the VIX on Wednesday was just as dramatic as the Dow, only to the downside.  The VIX dropped nearly 15% in one day and crashed right through its 200 day MA, completing a bearish stochastic crossover in the process.  And even at that, we're still overbought.  So it looks like there's more downside to come.

Market index futures: Tonight all three futures are lower at 12:23 AM EST with ES down by 0.19%.  This is perhaps to be expected after ES rallied hard on Wednesday all the way to its resistance at 1805.  After a big move like this, I'd expect a pause or a bit of retracement.  But I'm also thinking ES is going to check out its upper BB, now at 1811, pretty soon.

ES daily pivot: Tonight the pivot jumps from 1781.58  to 1790.75.  Note that tonight we are switching to the 2014 "H" ES contract.  We've been above the pivot since the Fed announcement and remain well above the new pivot, so this indicator remains bullish.

Dollar index: The dollar ended up little changed on Wednesday with a spindly doji.  With no real RTC going right now and the indicators wandering around halfway between oversold and overbought, I've got no way to call this chart.

Euro: The euro put in a similar long-legged doji on Wednesday but the new overnight is gapping down big time, off 0.69%.  A lower close looks likely here on Thursday.

Transportation: After a dip on Tuesday, the trans roared upward like everything else following the Fed news on Wednesday.  That sends the indicators off oversold and on their way to overbought.  No resistance til 7228, so there's more upside left here.


Accuracy (daily calls):

Month     right wrong  no call  conditional  batting   Dow
                                             average  points
 
January    5      7      6           3        0.533   -101
February   3      4      5           6        0.692    131
March      5      7      5           2        0.500    121
April      7      5      5           3        0.667    328
May        3      4      6           4        0.636     85
June       6      5      6           0        0.545    543
July      10      2      4           4        0.875    486
August    11      3      6           2        0.813    687
September  8      3      3           3        0.800    485
October    7      5      8           2        0.643    674
November   6      6      2           1        0.538    123
December   5      5      3           0        0.500    160

     And the winner is...

With the Fed uncertainty finally out of the way, it looks like the technical signs are bullish tonight.  However after running so hard so quickly, Mr. Market may need to pause to catch his breath on Thursday.  I think we could be in for a doji day, so accordingly I'm going to call Thursday uncertain.  I'm not expecting a big move either way.

ES Fantasy Trader

Portfolio stats: the account remains at $110,625 after 17 trades (13 for 17  total, 7 for7 longs, 6 for 10 short) starting from $100,000 on 1/1/13.  Tonight we stand aside.again.