Thursday higher

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

• Thursday higher, low confidence.
  
• ES pivot 1647.92.  Holding above is bullish.
• Friday bias higher technically.
• Monthly outlook: bias lower.
• ES Fantasy Trader standing aside.

Recap

Tuesday's suppressed bullish momentum made a comeback on Wednesday as the Dow gained 97 points.  We now analyze this interesting development and what it holds for Thursday.

The technicals (daily)

The Dow: Several days of sideways movement finally brought the Dow out of its month-long declining RTC and Wednesday was the bullish trigger.  Even after a 0.65% gain the indicators remain low, just recently off oversold.  With no resistance til 15K, I think we could revisit that level on Thursday..

The VIX:  And the VIX is correspondingly bearish right now.  Last night I said it "looks like it wants to go lower." and so it did, down 4.39% Wednesday to break its recent support.  But with a recent bearish stochastic crossover, an overbought RSI, and last week's gap up finally getting filled, more downside seems possible on Thursday.

Market index futures: Tonight all three futures are modestly higher at 2:41 AM EDT with ES up by 0.06%.  Es had its best day since August 22nd on Wednesday and is now clearly in an uptrend.  With rising indicators and no resistance until 1661, a move to that level looks possible on Thursday.

ES daily pivot: Tonight the pivot steps up again  from 1639.92  to 1647.92.  We remain above the new pivot, so that's bullish.

Dollar index: Last night I mentioned a bearish tri-star.  Well this unusual three day pattern completed on Wednesday, along with a bearish stochastic crossover.  With n overbought RSI and just coming off its upper BB, this might not be a bad shorting opportunity..

Euro: On Wednesday the euro exited its steep descending RTC for a bullish setup with a bullish piercing pattern.  The overnight is off a bit  but with an oversold RSI and bullish stochastic crossover, the euro looks ready to move higher on Thursday.

Transportation: The trans continue to look bullish after outperforming the Dow on Wednesday.  A bullish stochastic crossover and RSI still just oversold complete the picture.

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

 34  8/19       23         54        -      -   1656

 35  8/26       23         50        -      -   1664 

 36  9/3        21         54        -      -   1633

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 once again we were both wrong.  Therefore we continue the year with an accuracy of 16  for 32, or 50%, perfect coin-flipping territory.   The poll as a whole drops to 13 for 29 or 45% - and that's contrarian territory.

This week the poll is little changed, with bearish sentiment continuing to run quite high, no doubt partly on the basis of seasonality.  I continued to vote bearish, staying with the majority.

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  2      0      0           0        1.000    121

     And the winner is...

The bullish forces at work for the past two nights now remain in play.  In the absence of any real bearish signs or reversal indicators, the logical call is for Thursday higher.

ES Fantasy Trader

Portfolio stats: the account remains at $108,500 after 15 trades (11 for 15  total, 6 for 6 longs, 5 for 9 short) starting from $100,000 on 1/1/13.  Tonight we continue to stand aside.

Wednesday higher

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

• Wednesday higher, low confidence.
  
• ES pivot 1639.92.  Holding above is bullish.
• Rest of week bias higher technically.
• Monthly outlook: bias lower.
• ES Fantasy Trader standing aside.

Recap

Well despite the best efforts of John Boehner and Mr. Softee to torpedo the market on Tuesday , the Dow would not be denied and still managed to close a decent 24 points higher.  Tonight I have to do a quick post because I need to get up early Wednesday morning, something I hate, to go flying (something I love).  The analysis is complete, but the write-up is short.

The technicals (daily)

The Dow: Consolidating, descending RTC exit = bullish setup, support holding, bullish inverted hammer, indicators just off oversold, looks fairly bullish.

The VIX:  Consolidating on continued indecision, five reversal candles in a row now, rising RTC done so trend is over, unfilled gap below remains, indicators close to overbought, looks like it wants to go lower.

Market index futures: Tonight all three futures are higher at 12:46 AM EDT with ES up by 0.15%.  ES star on Tuesday is a reversal warning but not confirmed in the overnight.  Gradual daily drift higher plus low indicators & no resistance til 1645 = looking bullish.

ES daily pivot: Tonight the pivot steps up from 1633.92  to 1639.92.  Just broke above the new pivot -> bullish.

Dollar index: Big gap-up 0.32% gain Tuesday but now forming a bearish tri-star.  Overbought indicators, closed above upper BB, looking for lower on Wednesday.

Euro: Waterfall decline continues, 200 day MA just touched intraday - as I mentioned last night.  Highly oversold indicators, stochastic nearing bullish crossover, end to decline coming in a day or two.

Transportation: Inverted hammer (not perfect), oversold RSI, new bullish stochastic crossover, lower BB touched, higher likely Wednesday.


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  1      0      0           0        1.000     24

     And the winner is...

The positive signs I was seeing last night are still there tonight.  And even some bad news on Tuesday was unable to drive the market lower so there does seem to be some gas in the tank.  With basically bullish charts, the logical call in for Wednesday higher.

ES Fantasy Trader

Portfolio stats: the account remains at $108,500 after 15 trades (11 for 15  total, 6 for 6 longs, 5 for 9 short) starting from $100,000 on 1/1/13.  Tonight we continue to stand aside - this time because again I feel like I missed the entry with ES having already posted a good size move this evening.

Tuesday higher

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

• Tuesday higher, medium confidence.
  
• ES pivot 1633.92.  Holding above is bullish.
• Rest of week bias higher technically.
• Monthly outlook: bias lower.
• ES Fantasy Trader standing aside.

Recap

Well I called last Friday higher and it didn't work out but that's so long ago now that I'm sure no one's even interested anymore.  So let's just move on to a new week and a new month.

The technicals (daily)

The Dow: On Friday the Dow put in a nominally bearish engulfing pattern, but with end of week and end of month stuff going on, I'm taking this one with a grain of salt.  Indicators remain low suggesting the bias is more towards the upside from here.

The VIX:  After a big gap up last week, the VIX put in three reversal warning candles.  Add in Friday's tall inverted hammer and that makes four.    With a stochastic on the verge of a bearish crossover, I'm thinking that what went up is about to come down.

Market index futures: Tonight all three futures are higher at 12:35 AM EDT with ES up by an impressive and unusual 1.01%.  This move completely negates the dark cloud cover we got last Friday, helps establish a new rising RTC and just gave us a newly completed bullish stochastic crossover.  That all leaves this chart looking bullish.

ES daily pivot: Tonight the pivot notches down from 1636.42  to 1633.92. After being above all day last Friday, we're even higher now, so this one is looking clearly bullish.

Dollar index: After last Thursday's bust through the 200 day MA< we saw follow-through on Friday as the dollar gained another 0.17% on a green spinning top.  It left the indicators considerably overbought though so I'd say there's at least a possibility of a move lower on Monday.

Euro: The euro continues to be trapped in a steep descending RTC, despite having hit oversold two days ago.  And it's continuing lower in the Monday overnight so I'd say there's a definite possibility we'll hit the 200 day MA at 1.3137 in a day or two.

Transportation: The trans underperformed the Dow badly on Friday, down 1.14%.  That was enough to touch the lower BB intraday and move the stochastic into position for a coming bullish crossover.  While there's no reversal candle on this chart, I think the downside is limited from 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

     And the winner is...

The first day of most months are historically bullish and September is no exception despite its poor performance overall.  And with generally bullish charts tonight plus the futures guiding higher, it looks logical to call Tuesday higher.

ES Fantasy Trader

Portfolio stats: the account remains at $108,500 after 15 trades (11 for 15  total, 6 for 6 longs, 5 for 9 short) starting from $100,000 on 1/1/13.  Tonight we continue to stand aside - this time because again I feel like I missed the entry with ES having already posted a good size move this evening.