Friday, January 17, 2014

Friday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Friday higher, low confidence.
  • ES pivot 1838.17.  Dropping below is bearish.
  • Next week bias uncertain technically.
  • Monthly outlook: bias higher.
  • ES Fantasy Trader standing aside

Ouch!  Another day, another miss for the Night Owl.  Clearly the current market does not agree with my forecasting style.  I guess it just proves the old adage that everyone's hot until they're not.  Tonight we retrench and try to figure out what's going on with Mr. Market this month that has me stymied.

The technicals (daily)

The Dow: I'm afraid I have no technical explanation for Thursday's 65 point drop in the Dow.  In fact the action all year so far has been pretty herky-jerky as the market tries to find a direction.  I'm happy to admit I haven't a clue.

The VIXAt least I was right about the VIX being at a turning point when I wrote last night "I'd be very surprised if the VIX had much more downside left to it" as the VIX rose 2.04% on Thursday confirming the hammer.  But form here I'm kind of at a loss - the stochastic has stopped oscillating, we're between BB's and there's no decent RTC to follow.  Even VVIX is in the same boat.  So I'm stumped on this chart too.

Market index futures: Tonight all three futures are higher at 12:48 AM EST with ES up by 0.10%.  Thursday's candle was something of a dark cloud cover but it remained inside the rising RTC and the indicators are basically just wandering aimlessly.  There is really not much to go on here for Friday.

ES daily pivot: Tonight the pivot barely dips from 1839.58  to 1838.17.  There isn't even any clarity here as the overnight drift higher in ES has glued itself right on the new pivot.  Sitting on the fence like that, this indicator is neither bullish nor bearish.

Dollar index: At least we have a pattern here.  On Thursday the dollar lost 0.15% on a bearish engulfing pattern that basically completes an evening star.   Also RSI and momentum are now falling but we have a rising stochastic.  It's not often the indicators don't even agree with each other nut that just emphasizes the nervous nature of the markets right now.  I'm not calling this one.

Euro: Same deal with the euro, three up then two right back down.  Then a gain Thursday to leave us right in the middle of that entire range.  No idea.

Transportation: After touching their upper BB on Wednesday, the trans dropped 0.63% on Thursday giving up all of Wednesday's gains and then some.  But that just leaves us a 7456, a level we've seen every day for the past five sessions.  RSI is overbought, but only a little.  The only thing I see here is a bearish RTC setup but it's not really much to go on.  So no call here either.

Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points

January    1      6      4           0       0.143     -315

     And the winner is...

Wow - it's rare that I can't find some indication of market direction from any of my favorite charts but tonight is one of those times.  I'm completely shut out here, and on top of everything else it's op-ex Friday so all I can do is call Friday uncertain.  And with next Monday being a holiday, we'll see you again Monday night rather than Sunday.

ES Fantasy Trader

Portfolio stats:  the account continues the new year at $100,000 as we wait for the right moment to enter our first trade of 2014.

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