Tuesday, March 25, 2014

Tuesday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Tuesday uncertain.
  • ES pivot 1852.25Holding below is bearish.
  • Rest of week bias uncertain technically.
  • Monthly outlook: bias higher.
  • ES Fantasy Trader standing aside.

After an early plunge Monday morning, the Dow spent the rest of the way clawing its way back to break even - and almost made it, thus just barely saving my call for a lower close.  All of which leaves us in an awkward spot, so let's see if the charts can clarify any of this for Tuesday.

The technicals (daily)

The Dow: So the Dow gave us a perfect spinning top on Monday.  But coming as it does in a trendless environment, it's anybody's guess as to whether this is warning of a move higher or lower.  And with no RTC and indicators still neither overbought nor oversold, we continue to just drift sideways, so no call here.

The VIXOn Monday the VIX continued playing with its 200 day MA putting in a big inverted hammer that has zero predictive power.  The stochastic is lying flat on the floor and there's no RTC at all.  We are right on the MA and exactly halfway between BB's so I have no way of telling which way this chart is going next.

Market index futures: Tonight all three futures are higher at 1:28 AM EDT with ES up by 0.15%.  ES gave us a broad spinning top on Monday to go with a completed bearish stochastic crossover.  The new overnight candle is developing as a bullish harami but it's never prudent to read too much into a half-baked candle.  We in fact have a bearish RTC setup, though the channel is a bit broader than I like to see (it has a Pearson's of 0.857).  So overall, this chart remains generally bearish.

ES daily pivot: Tonight the pivot drops from 1863.08  to 1852.25.  That drop, coupled with the overnight rise in ES briefly put it back above the new pivot but as I write it just dipped back under and that is a fairly bearish sign.

Dollar index: On Monday the dollar completed its bearish tri-star thingy with a 0.23% drop that also formed a bearish stochastic crossover.  This all spells lower for the dollar on Tuesday..

Euro: On Monday the euro put in a gain big enough to pop it out of its descending RTC (as I mentioned last night) for a bullish setup.  With a now completed bullish stochastic crossover, one would think the euro continues higher on Tuesday.

Transportation: On Monday the trans continued their lazy drift lower with a star doji.  But indicators still aren't down to oversold so there really isn't much bullish impetus visible here at the moment.

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     10       3      3           0       0.759    291

     And the winner is...

The charts aren't particularly clear tonight.  The tendency, such as it is, remains bearish.  However the SPX Hi-Lo index's MACD has just crossed the zero line moving upward and that's usually a good bullish sign.  But overall I'm just not getting a good read on this market so I'm going to once again have to call Tuesday uncertain.

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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