Actionable ideas for the busy trader delivered daily right up front
- Monday higher.
- ES pivot 1750.83. Holding above is bullish.
- Rest of week bias uncertain technically.
- Monthly outlook: bias higher.
- ES Fantasy Trader standing aside
Zzzz...zz...zzz...huh? Oh wait - is it the end of October already? Sorry, I must have dozed off there for a minute. But hey, if I had to choose between last week's boring action and the summer of 2011 when the ability of the Greeks to pay their bills or not would determine the end of the universe, and well give me boring every time. So will Rip Van Market slumber his way through the rest of the month or is he going to suddenly wake with a start? We can find out by doing some chart peeping. So grab your late-nite (or early morning) extra double triple espresso and let's get cracking. Yum!
The technicals (daily)
The Dow: As my Scottish cousin Owl McTavish would say about the Dow's ability to rise further, "Ee ha' me doots". But doubters are losers and we gained another 61 points on Friday to remain inside the rising RTC. The upper BB continues to fly away, now 15,659, so there's still room to run here.
The VIX: The VIX only fell 0.03% on Friday but that was enough for a bearish RTC trigger. The inverted hammer isnt' a great reversal candle and with the lower BB way down to 11.16 now and no support til 12.86, there's still room to run lower on Monday.
Market index futures: Tonight all three futures are higher at 12:26 AM EDT with ES up by a decent 0.31%. After some resistance earlier last week, ES has now cleared the 1750 hurdle as it continues to march into record territory. With the developing overnight candle we now have a three white soldiers pattern and with the upper BB at a patriotic 1776, it looks like ES may be interested in taking a peek at it.
ES daily pivot: Tonight the pivot rises from 1746.75 to 1750.83. The move up in ES earlier this evening keeps us comfortably above the new pivot and keeps this indicator bullish.
Dollar index: The dollar finished Friday dead flat after a failed rally attempt. So the downtrend remains intact though it appears the buck is trying to find some footing at these levels. There's no clear direction here for Monday..
Euro: The euro likewise seems to have encountered some resistance in the 1.3810 area. With the Sunday overnight currently up just 0.02% and indicators just starting to budge off extreme overbought, it looks like the next move may be lower.
Transportation: Here's a bit of bearish divergence - on Friday the trans lost 0.20% to the Dow's 0.39% gain with a classic red spinning top. We're still well inside the rising RTC but this is at least a suggestion of a reversal - though one which requires confirmation.
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 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 6 4 6 2 0.667 602
And the winner is...
With the lone exception of the trans (and that one isn't confirmed) the charts continue to look bullish tonight, so logic dictates a call of Monday higher.
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.