Friday higher

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

• Friday higher, low confidence.
  
• ES pivot 1784.67.  Holding above is bullish..
• Next week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

It looks like the market still had some gas left in the tank after all as the Dow gained 55 points on its way to another record close.  That just leaves an op-ex day to go for the week so let's see if there are any signs to Friday's action in the charts.



The technicals (daily)

The Dow: Thursdays's green marubozu brought the Dow to its upper BB.  It also went overbought and the stochastic is now close to forming a bearish crossover.  So there's a few warning signs but without a reversal candle I can't call this chart lower yet.

The VIX:  Last night I wrote "the VIX could run lower at least one more day" and indeed on Thursday it broke support at 12.50 and closed almost down to its lower BB.  But the indicators have yet to go oversold.  There's now some minor support st 12.30, then nothing til the August lows of 11.84..  So overall, with two black crows cawing away, I can't call this chart higher yet.

Market index futures: Tonight all three futures are higher at 12:29  AM EST with ES up by 0.14%.  ES traded higher on Thursday, actually closing above its upper BB.  That was enough to finally move it to overbought but the stochastic is still not interested in forming a bearish crossover and the overnight continues higher into record territory.  So despite the rarified atmosphere up here, I still can't call this one lower yet.

ES daily pivot: Tonight the pivot rises from 1771.75  to 1784.67.  Once again we remain comfortably above the new pivot so this indicator remains bullish.

Dollar index: Last night I thought the dollar was moving lower and while it did put in a red candle on Thursday, it was a harami hammer so it was a higher close.  The trend is quite choppy but still vaguely lower, so that's what I'll claim for Friday here.

Euro: And sort of the same deal with the euro.  Although Thursday did move higher early on, it gave up those gains into the close for a red spinning top and a small loss.  The overnight is dead flat and the indicators are mixed so this one's too tough to call.

Transportation: The trans struck a slight note of caution Thursday, gaining 0.27% but on a small spinning top as an evening star after nearly touching their upper BB intraday.  But the indicators still aren't overbought and we remain solidly inside a steeply rising RTC so it's still too soon to call a top here.


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   17/33  14/30

 34  8/19       23         54        -      -   1656   17/34  14/31

 35  8/26       23         50        -      -   1664   17/35  14/32

 36  9/3        21         54        -      -   1633   17/36  14/33

 37  9/9        35         30        +      +   1655   18/37  15/34

 38  9/16       40         28        +      +   1688   19/38  16/35

 39 9/23        52         36        +      +   1710   20/39  17/36

 40 9/30        39         43        +      -   1692   21/40  17/37

 41 10/7        30         33        +      -   1691   22/41  17/38

 42 10/14       48         22        +      +   1703   23/42  18/39

 43 10/21       57         30        +      +   1745

 44 10/28       59         19        +      +   1760  

 45 11/4        42         25        +      +   1762

 46 11/11       39         39        +      x   1771

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 I voted bullish four weeks ago, along with the majority of the poll we were both right.  Therefore we continue the year with an accuracy of 23 for 42, or 55%.   The poll as a whole rises to 18 for 39 or 46% - it continues to be a tough year for the poll so far.

This week with falling bullish sentiment and rising bearish sentiment, the poll is in a dead tie at 39.13% each.  I however continued to vote bullish for the 10th week in a row.  This rally feels like it's getting long in the tooth but looking at the charts objectively I still don't see a top forming.  I guess we'll find out in 30 days.


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   4      4      1           0        0.500     95

     And the winner is...

November op-ex is historically pretty bullish and I'm not really seeing any bearish signs in the charts right now, so the logical call is for Friday higher.  That's all she wrote.  See you again Sunday night!

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.

Thursday higher

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

• Thursday higher, low confidence.
  
• ES pivot 1764.42.  Holding above is bullish..
• Friday bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Well op-ex week rolls on in crazy fashion true to form.  I was expecting a down day Wednesday but what we got instead was a solid 71 point bump in the Dow - go figure.  But that was then and this is now.  Let's see if we can get it right on Thursday.

The technicals (daily)

The Dow: The Dow completely non-confirmed Tuesday's spinning top and broke through resistance at 15,778 on Wednesday.  But this 0.45% advance still hasn't moved the indicators to overbought, or hit the upper BB, or given us a bearish stochastic crossover.  So my expectations for lower were wrong-o and now this chart looks bullish again.  Go figure.

The VIX:  The VIX dropped right back to its latest support line at 12.5 on Wednesday and just touched its lower BB.  But with indicators still not yet oversold and a spinning top in VVIX, it's not out of the question that the VIX could run lower at least one more day.  But beware - the VIX generally does a good job of turning once it's hit its lower BB.

Market index futures: Tonight all three futures are lower at 1: AM EST with ES down by %.   We got a strong green candle out of ES on Wednesday that touched its upper BB.  But we're getting some surprisingly resilient pin action in the overnight.  With indicators not yet overbought and another record close on the books, it looks like the sky's the limit.  I see nothing bearish on this chart tonight.

ES daily pivot: Tonight the pivot rises from 1764.42  to 1771.75.  Even with that gain, ES is still comfortably above the new pivot so this indicator now turns bullish.

Dollar index: After two days of noodling around it looks like the dollar has finally decided on a direction, and the direction is down.  Indicators are now on the march off overbought and Wednesday's red candle suggests more downside to come..

Euro: On Wednesday the euro delivered the payoff for Tuesday's bullish RTC trigger, closing at 1.3463.  The overnight gapped up and then gave a bit back though we're still a bit higher at the moment.  But with the indicators still rising and no resistance til 1.3515 it looks like this chart has more room to run higher, and that squares with my call for a lower dollar.

Transportation: Ah - never dismiss bullish divergences in the trans.  We certainly got the warning on Tuesday with a nice gain here, and bada-bing, up we went on Wednesday.  The trans now have a nice four day winning streak going and have cleared resistance at 7127 with another record close.  And we're still not even overbought yet, and the upper BB is still way up at 7194, so there's clearly still more room to run 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
September  8      3      3           3        0.800    485
October    7      5      8           2        0.643    674
November   3      4      1           0        0.429     40

     And the winner is...

Last night I ignored a strong showing in the trans and paid the price on Wednesday.  And what a difference a day makes - all the charts are now suddenly looking bullish so I'll just have to call Thursday 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.

Wednesday lower

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

• Wednesday lower, low confidence.
  
• ES pivot 1764.42.  Holding below is bearish..
• Rest of week bias lower technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Well some yammering from assorted Fed heads on QE on Tuesday torpedoed our call for a higher close with the Dow ending down 32 points.  All of which leaves us in a perplexing position.  These trendless markets are tough to trade but maybe the charts will give us a clue for Wednesday.

The technicals (daily)

The Dow: On Tuesday the Dow put in a second spinning top, slightly below Monday's.  The indicators are now overbought and it's hard to see where more gas is coming form for another leg higher.  I'm seeing more downside risk than upside potential here tonight.

The VIX:  The VIX gained 2.31% on Monday, a move belied by the tiny doji it formed.  But it still traded outside its descending RTC for a bullish trigger.  We're also close to the lower BB now so I'm thinking we're near a turning point here - or at least the stage is set.

Market index futures: Tonight all three futures are lower at 12:24 AM EST with ES down by a worrisome 0.33%.  ON Tuesday ES gave us a second spinning top.  I find that these double spinning tops are often decidedly bearish and with the overnight moving lower, this seems to be the current case.  So contrary to what I wrote last night, I'm switching my view of this chart from bullish to bearish.

ES daily pivot: Tonight the pivot drops from 1766.83  to 1764.42.  Owing to a steady drop in the overnight, we remain below the new pivot so this indicator remains bearish.  The indicators are now moving lower, having never quite hit overbought and the stochastic is about to execute a bearish crossover.

Dollar index: It was hard to tell which way the dollar was going last night and I guess it didn't know either, finishing Tuesday up just 0.06% with a doji.The gestalt of this chart is bearish, but not enough for me to call the dollar lower.

Euro: :Last night I wrote "This one looks higher for Tuesday" and the euro did indeed extend its gains with a green spinning top sitting just above Monday's candle.  That caused a bullish RTC trigger and brought us off oversold.  So I'd say the euro's going higher on Tuesday.  The overnight seems to be confirming that, up 0.14% so far.

Transportation: Last night I wrote "This chart now looks even more bullish" and sure enough, the trans extended their gains on Tuesday in an interesting bit of bullish divergence, rising 0.69% while the Dow was down 0.21%.  That gives us three white soldiers, a new rising RTC, a bullish stochastic crossover, no resistance til 7130, and an upper BB still nearly 100 points away.  So once again, this chart looks bullish.


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   3      3      1           0        0.500    111

     And the winner is...

The only bright spot in the charts tonight comes from the trans which are giving an early Dow Theory warning of a move higher.  But it may be a bit too early since nothing else is now looking at all bullish.  Given that, I'm afraid I have to call Wednesday lower.  I'll be happy to be proven wrong.

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.

Tuesday higher

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

• Tuesday higher, low confidence.
  
• ES pivot 1766.83.  Holding above is bullish..
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Another yawner of a day, with low volume and the bond markets closed as we celebrate Veteran's Day and salute those who gave their lives to protect what is still the greatest nation on the planet.  It's also op-ex week once again, so we can expect the usual gyrations around that.  So with that in mind let's see where Tuesday's headed.

The technicals (daily)

The Dow: On Monday the Dow defied the emerging megaphone by breaking out above resistance at 15,763 for yet another record close.  The small candle doesn't qualify as a reversal warning and although we just went overbought, the upper BB is still 80 points away, so there's a least a little more room to run higher here.

The VIX:  And after an ill-fated attempt to break higher last week, the VIX instead broke below its recent trading range, giving up support at 12.70 on Monday.  And with VVIX similarly either uninterested or unable to get anything going, prospects for a move higher on Tuesday look dim.

Market index futures: Tonight all three futures are higher at 12:29 AM EST with ES up by a modest 0.08%.  Nevertheless, this is non-confirming Monday's doji.  It's also clearing resistance at 1767, and with indicators not yet overbought and the upper BB at 1780, this chart still looks bullish.

ES daily pivot: Tonight the pivot rises exactly 10 from 1756.83  to 1766.83.  We remain just above the new pivot, so this indicator remains bullish.

Dollar index: The dollar moved lower Monday with no discernable pattern.  Ya got me, pal.  I've no clue where this one's headed..

Euro: On Monday, broke out of a descending RTC for a bullish setup that moved the indicators higher (though still oversold) and bounced off the lower BB.  This one looks higher for Tuesday (so maybe dollar lower?)

Transportation: Last night I wrote "this chart now looks mildly bullish", and the trans broke out of a descending RTC for a bullish setup on Monday with a decent 0.46% advance that moved the stochastic into position for a bullish crossover.  This chart now looks even more bullish.


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   3      2      1           0        0.600    143

     And the winner is...

Gosh, the rarified atmosphere at these record levels makes me want to reach for the oxygen mask.  But all the forces in play last night still seem to be here tonight, so I guess I just have to once again call Tuesday 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.

Monday higher

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

• Monday higher, low confidence.
  
• ES pivot 1756.83.  Holding above is bullish..
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Last Thursday night I called Friday as "uncertain" and I'm glad I did because I sure never saw Friday's 168 point pop in the Dow coming.  It made for some interesting charts, which we will now pick over for clues to Monday.

The technicals (daily)

The Dow: On Friday the Dow powered to another record close, for no readily apparent reason.  But more interestingly, we now have three days of alternating expanding  up/down days, aka a megaphone pattern.  The megaphone of course is bearish and reflects not just uncertainty but instability.  It's like Mr. Market is skating along and suddenly develops the dreaded speed wobbles.  So while the one-day pattern is bullish engulfing, the overall gestalt here is worrisome.

The VIX:  Meanwhile, the VIX was down 7.26% on Friday.  No megaphone here - in fact with the indicators turning downward again and Thursday's bullish RTC setup canceled, this chart is looking lower for Monday.

Market index futures: Tonight all three futures are lower at 12:23 AM EST with ES down by 0.13%.  Friday's bullish engulfing candle came on high volume but resistance around 1767 remains a problem.  The indicators are still not overbought but I don't see a lot of mojo here to make Mr. Market want to get on the bus.

ES daily pivot: Tonight the pivot bumps up from 1754.00  to 1756.83.  Even with the slight overnight drift lower, we remain reasonably above the new pivot, so this indicator is bullish.

Dollar index: That pesky dollar surprised me on Friday by moving higher instead of lower, with a strong 0.66% gain to end above its upper BB..While this is nominally bullish, the behavior of the dollar lately has been so erratic I'm just not going to commit to that.

Euro: And on Friday the euro continued its plunge, now down to 1.3363 with its highs of 1.3819 of a few weeks ago now just a distant memory.  We've now hit the lower BB but there's no real signs of a turn-around so I'd have to say more downside is possible Monday.

Transportation: On Friday the trans retraced most of Thursday's losses with a bullish piercing line pattern.  That also caused the indicators to reverse course and begin moving higher, so overall this chart now looks mildly bullish.


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   2      2      1           0        0.500    122

     And the winner is...

Tonight the charts are painting a mildly bullish picture in muted pastels as it were.  I think we really need some good economic news to juice the markets higher at this point, and we're not getting it on Monday.  Maybe the best sign is the NYSE A/D line which just turned positive after being rather depressed.  So this is another of those nights where I'm going to call Monday higher as much because of an absence of bearish signs as a presence of bullish ones.

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.