Actionable ideas for the busy trader delivered daily right up front
- Tuesday uncertain.
- ES pivot 1548.83. Holding above is bullish.
- Rest of week bias uncertain technically.
- Monthly outlook: bias higher.
- ES Fantasy Trader standing aside.
Well it seemed like a reasonable idea at the time and things did get off to a good start Monday morning, but then some Dutch official threw cold water on the Cyprus deal and that was that. I thought we'd go higher after the strong showing of the futures Sunday night but the Dow instead finished down 64. So we move on to Tuesday in search of technical redemption.
The technicals (daily)
The Dow: What started off as a decent rally ended up as just another sideways day on Monday, leaving the Dow now stuck in a six day range of alternating up and down days bouncing between 12,422 and 14,510. With no trend in sight, last night's bullish stochastic crossover unraveled, and the indicators flattening out, it looks like more of the same in store for Tuesday. Being as we're now near the lower end of the range, I'd say a move higher would be as logical an expectation as anything.
The VIX: I missed this one too, as the VIX rose 1.25% on Monday. But like the Dow, there isn't much in the way of a trend here so I'm taking a pass on this chart tonight.
Market index futures:Tonight all three futures are higher at 1:26 AM EDT with ES up by 0.15%. What a difference a day makes. The megaphone pattern I'd been talking about the past few days pretty much collapsed on Monday. That's what news will do to technicals. All this leaves us with is a descending RTC exit two day ago which is now a bullish trigger. But it's not supported very well by the indicators which remain rather wishy-washy between overbought and oversold.
ES daily pivot: Tonight the pivot inches up from 1547.00 to 1548.83.. Although ES broke back above the old pivot right at the close on Monday, the gain in the new pivot now leaves us just barely above it - not enough to be considered bullish. But in the absence of a break under, it's not bearish either.
Dollar index: I was wrong about the dollar too last night. Instead of declining, it jumped 0.56% and instead of a bearish stochastic crossover we're suddenly looking at a bullish one. But since exiting its February rising RTC, the dollar has been all over the map, no doubt reflecting the resurgence of news from Europe as a market mover. So not much to say here tonight..
Euro: The euro reversed course on Monday completely erasing Sunday night's gains and stopping right on its 200 day MA at 1.2871. What looked like a bounce is now canceled. And the overnight is pretty much just hugging the MA. So there's no good direction from this chart either.
Transportation: The trans lost 0.72% Monday and that was enough to drive them oversold and keep us in a weak downtrend. But with support of a sort around 6115m further downside seems limited at this point, though there's no immediate sign of a move higher on Tuesday here.
Accuracy (daily calls):
Month right wrong no call conditional batting Dow
January 5 7 6 3 0.533 -101
February 3 4 5 6 0.692 131
March 5 5 4 2 0.583 206
And the winner is...
It's rare that I get so little guidance from the charts but tonight is one of those nights. I'm seeing just a lot of sideways action here. And with no way to tell if the next move will be up or down, I'm left as having to simply declare Tuesday uncertain. Maybe I ought to just take the rest of the week off.
ES Fantasy Trader
Portfolio stats: the account remains at $94,000 after 9 trades (7 for 9 total, 3 for 3 longs, 4 for 6 short) starting from $100,000 on 1/1/13. Tonight we stand aside in light of the "uncertain" call.