Monday uncertain

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

• Monday uncertain.
  
• ES pivot 1806.42.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

I hope everyone had a happy Thanksgiving.  Not much happened in the market, with mostly meaningless sideways action.  So as 2013 starts to wind down, let's see where Monday's headed.

The technicals (daily)

The Dow: Last week the Dow put in four consecutive dojis, but that's more a reflection of the holiday shortened week than anything else so I wouldn't read too much into that.  However, if we look at the weekly chart, we see extremely overbought indicators and a stochastic that just formed a bearish crossover.  The last two times we were here, the market then moved lower.  Momentum has also been falling for three weeks now.  Hmmm...

The VIX:  Unlike the other charts which were pretty blah last week, the VIX rose all week up 5.55% just last Friday.  That completed a bullish stochastic crossover but it also touched the upper BB so its not clear how much more upside is left here.  We're also real close to a good resistance line at 13.88 ad I'll note that VVIX has not been participating in this advance, so I'm dubious that the VIX has much upside left from here.

Market index futures: Tonight all three futures are modestly higher at 12:26 AM EST with ES up by 0.07%.  ES spent last week basically moving sideways, which ejected it from its rising RTC for a bearish trigger.    But with the chart distortions induced by the holiday week, I'd take this one with a grain of salt.  That said, the indicators are now highly overbought, but we've seen ES have the ability to stay that way for extended periods and still run higher.  So my best guess right now is that this chart is mildly bullish.

ES daily pivot: Tonight the pivot inches up from 1804.33  to 1806.42.  However, that's just enough to now place ES below the new pivot, so this indicator turns bearish.

Dollar index: The dollar is back in a downtrend as it continues to put in lower lows and lower highs.  With indicators not yet oversold, I see no signs of a reversal here..

Euro: After a big dump two weeks ago, the euro has been marching right back higher again though it's been struggling the past few days around the 1.3513 level.  However, with a healthy 0.15% gain in the Sunday overnight so far, we remain in a steeply rising RTC, so it looks like the uptrend continues.

Transportation: Last week the trans cleared their last resistance level at 7214 to close at 7236.  Indicators are now overbought and the stochastic is close to making a bearish crossover but we have yet to hit the upper BB and remain in a rising RTC.  Still, I'm getting a bit nervous about this chart as it's now looking a bit 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   7      6      2           1        0.571    131 

     And the winner is...

I'm getting some conflicted signals form the charts tonight, due in part to last week's low-participation action.  Because of this, I think the prudent course is to simply call Monday uncertain as we wait for a new candle to begin a full trading week, providing us with some better direction.

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.