Monday, March 10, 2014

Monday lower

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Monday lower, low confidence.
  • ES pivot 1878.25.  Holding below is bearish.
  • Rest of week bias uncertain technically.
  • Monthly outlook: bias higher.
  • ES Fantasy Trader standing aside.

The trend continues to be our friend, even as I don't see much reason to call the ,market higher.  But the fact that it's been going higher seems to suffice.  We now turn out attention to the charts as we attempt to sniff out those pesky bears to see when and if they're going to come out of hibernation.  Will it be Monday?  Read on...

The technicals (daily)

The Dow: On Friday the Dow gained 31 points with a green spinning top that ended teetering right on the edge of its rising RTC, close to but not quite a bearish setup after nearly hitting its upper BB.  That also brought the stochastic close to but not quite a bearish crossover.  So we now have some warnings of a reversal, but they frustratingly enough all require confirmation.  Se we have to wait and see how Monday plays out on this one.

The VIXMeanwhile. the VIX put in a funny green candle that traded mostly below Thursday's for a net 0.70% loss.  We're now right at support and the stochastic is trying to set u a bullish crossover but jut like the Dow, this one is only a suggestion of a reversal.  Nevertheless if I had to guess I'd say the VIX looks ready to move higher Monday.  A pop in VVIX back above its 200 day MA supports this notion.

Market index futures: Tonight all three futures are lower at 12:41 AM EDT with ES down by 0.25%. On Friday ES put in a long-legged doji that just tapped the upper BB.  The overnight action seems to be confirming that doji and is forming a bearish stochastic crossover.  So although we do remain in a rising RTC, the outlook for Monday is bearish.

ES daily pivot: Tonight the pivot rises from 1876.08  to 1878.25.  We moved below the old number Sunday evening and remain below the new pivot so this indicator turns bearish for the first time in a while.

Dollar index: On Friday the dollar put in something of a DCB after Thursday big dump.  The resulting spinning top indicates indecision..

Euro: And after last Thursday's big jump for the euro, on Friday it made an inverted hammer above its upper BB.  Despite this, it is continuing higher in the Sunday evening trade, so there's not any really bearish signs here for Monday.

Transportation: On Friday the trans gave us something of an inverted hammer that remained inside the rising RTC and pushed indicators further overbought while bouncing off the upper BB.  This could be a reversal sign, but one which requires confirmation.

Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points

January    5      10      6           0       0.333
February   5       2      2           1       0.750    107

March      4       0      1           0       1.000    475

     And the winner is...

All last week I was calling for higher closes less on bullish signs and more on a lack of bearish signs.  Well it looks like tonight we're finally seeing some.  And Dr. Copper took a big dump on Friday.  So I'm going to go ahead and call Monday lower.

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

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