Monday, March 24, 2014

Monday lower

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Monday lower, low confidence.
  • ES pivot 1863.08.  Holding below is bearish.
  • Rest of week bias uncertain technically.
  • Monthly outlook: bias higher.
  • ES Fantasy Trader standing aside.

With quadruple witching now out of the way, perhaps we can get back to doing some technical analysis again.  So let's see what the charts have in store for us on Monday.

The technicals (daily)

The Dow: In typical op-ex fashion, the Dow put in one weird-looking candle last Friday, this one being basically a big gravestone doji / inverted hammer affair that nearly touched the upper BB at its peak.  In the end it curved the stochastic around the very nearly make a bearish crossover.  In any event, this looks bearish for Monday.

The VIXAnd so the VIX had a funny candle too.  It putin a tall green candle but only ended 3.31% higher due to a gap-down open.  And that took it right through its 200 day MA again - now the eighth time in ten sessions!  And like the Dow, we now almost have a bullish stochastic crossover.  But with the VIX's recent attraction to the 200 MA, it's hard to tell if it can put two consecutive green candles together.

Market index futures: Tonight all three futures are just barely at 12:30 AM EDT with ES up by just one tick.  ES has now finished four straight days of alternating up and downs, all remaining in the 1851-1867 range.  Right now we're in the middle of that.  And without an RTC or other good technical guidance, this chart is too hard to call.

ES daily pivot: Tonight the pivot rises from 1859.08  to 1863.08.  This jump puts us back below the new pivot, so this indicator turns bearish.

Dollar index: Recall that last Thursday the dollar left us hanging with a big gap-up star that seemed to portend an evening star.  Well Friday was just about that, but the candle was closer to a tri-star than the classic evening star.  No matter - the pattern is still bearish.  I'd guess the dollar goes lower again on Monday.

Euro: Meanwhile, the euro did some bullish basing on Friday.  The small gain int he overnight so far is causing a bullish stochastic crossover and we're hanging on the edge of the descending RTC about to get a bullish setup.  With RSI hooking up from oversold, it looks likely that the euro goes higher on Monday.

Transportation: Last Friday the trans continued what's now looking like a slow drift lower, losing 0.36%.  And unlike the near misses in the Dow and the VIX, we did get a completed bearish stochastic crossover here.  So in the absence of any other indicators, this chart now looks officially bearish.

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      9       3      3           0       0.750    265

     And the winner is...

Hmm - tonight most of the signs seem to be bearish, not all that much but still I can't really call it any other way than 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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