Tuesday lower

• Tuesday lower, low confidence.
• ES pivot 1465.25.  Holding below is bearish..
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader going short at 1461.25.

Recap

Yawn - another "uncertain" call and another uncertain day it was as the Dow gained 19 points while the SPX lost 1.37  I've heard of the summer doldrums but this looks like the January doldrums.  Even yet another long-winded chest-thumper of a speech by Comrade Stalibama this afternoon wasn't able to tank this market.. So we continue, with the Dow drifting aimlessly higher as the SPX drifts aimlessly lower.  When will it all end?  We bow down to the chart gods and pray for deliverance.  Or at least some direction.

The technicals (daily)

The Dow: Today's ho-hum 0.14% gain belies the fact that the Dow is now on a four day winning streak.  This now gives us a decent rising RTC with an excellent Pearson's coefficient of 0.990.  And so far the Dow shows no signs of breaking out of that.  With indicators remaining stubbornly just shy of overbought I still can't call this chart lower yet.

The VIX:  Meanwhile, the VIX finally managed to post a winning day, up 1.20%.  But it did it with a red spinning top, suggesting a lack of enthusiasm for pushing higher.  Still, today's close at 13.52 is just outside the descending RTC for a bullish setup, and the previous three candles suggest that a bottom has been put in.  I'm more comfortable tonight calling for more upside here on Tuesday.

Market index futures:Tonight all three futures are lower at 12:48 AM EST with ES down by 0.19%.  After a hanging man last Thursday and a spinning top on Monday, the overnight seems to be providing some direction, and the direction is down.  Today's close was just outside the rising RTC for a bearish setup.  We' need to close above 1470.25 on Tuesday to cancel that, and I don't think that's going to happen.  With indicators now finally looking to have topped at overbought, this chart is now looking officially bearish to me.

ES daily pivot: Tonight the pivot inches up from 1467.00 to 1465.25..  We were below the old number all day and with a downward drift this evening, we're still below, so that's bearish.

Dollar index:Today's 0.09% drop in the dollar canceled Friday's morning star, all the while driving it to oversold levels.There's support after a fashion nearby at 54.69 but with the stochastic still falling, I'd say there's at least a bit of room to run lower again on Tuesday.

Euro: And the euro seems to be ;lagging the dollar by a day.  It put in its own spinning top today, closing on its upper BB again at 1.3385.  However, it is moving decidedly lower in the overnight, down 0.18% already and that is' so far at least, confirming the spinning top as a bearish sign for Tuesday.

Transportation:And the trans continue to roll on with a four day winning streak of their own, up an impressive half a percent on Monday.  The indicators remain overbought-broken and we remain in a rising RTC, so still no signs of a top here yet.

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 2012.
 

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  29/49

 50  12/10      46         29        N     1418  29/50

 51  12/17      52         28        -     1414  29/51

 52  12/26      52         26        +     1430

 

  1  12/31      40         48        - -   1402 

  2  1/7        47         30        + +   1466

  3  1/14       52         15        + +   1472

  

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 I voted bearish four weeks ago, so that was a miss.  Therefore, as we fill in the last few calls for 2012, I am now 29 for 51 or 57%.  I will remove all the 2012 entries after next week when we have a complete chart for the year.

This week we're getting a very large bull-bear sentiment spread, as bearish sentiment has now dipped to the lowest level in over a year while bullish sentiment continues to rise.  This is beginning to look contrarian bearish to me, and I say that admitting that I voted bullish in this week's poll.  I'll revisit my stance in a week.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points

January    2      2      4           1       0.600     0

     And the winner is...

The charts are not screamingly bearish tonight, but I'm going to go with the futures, the pivot, and the VIX, all of which seem to be suggesting a move lower.  Also the SPX Hi-Lo index has now been stuck on 100 since January 4th and that's starting to get old.  It's usually a good sign that a move lower is coming soon.  And I think we have on our side the fact that according to The Stock Trader's Almanac, op-ex week in January is historically weak.  So therefore I am calling Tuesday lower.

ES Fantasy Trader

Portfolio stats:  tonight the account remains at $103,750 after one trade (1 for 1 total, zero for zero longs, 1 for 1 short).  Tonight we go short at 1461.25.  I think that we're finally seeing some sort of direction and while this one may not be a big money-maker, there are a few points to capture here.