Tuesday, April 29, 2014

Tuesday higher

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Tuesday higher, low confidence..
  • ES pivot 1860.58.  Holding above is bullish.
  • Rest of week bias uncertain technically.
  • Monthly outlook: bias lower.
  • ES Fantasy Trader standing aside.

Wow - what a roller coaster ride.  We were up, then we were down, then we were up.  It was a great day for the day traders and an interesting one from the swing trading point of view.  We examine this further from tonight's charts.

The technicals

The Dow: On Monday the Dow just couldn't figure out where it wanted to go, finally ending 87 points higher, though if the bell had rung 30 minutes later, it might have been down 87.  It was just one of those days.  The conclusion is evident in the indicators, with momentum, money flow and OBV all rising but RSI and the stochastic falling.  The daily candle is similarly indecisive, so I just don't know where this one leaves us.

The VIX:  For the second day in a row the VIX challenged the 200 day MA and was rejected, losing 0.64% on a tall inverted hammer.  And confusion is evident here too as momentum is falling but the stochastic and RSI are rising.  I have to say, I don't get this chart either.

Market index futures: Tonight  all three futures are higher at 12:21 EDT with ES up by 0.12%.   On Monday ES gave us a tall tomahawk (a hammer with a protruding upper shadow).  RSI has just come off overbought but the other indicators are as confused as the other charts.  Still, with positive pin action in the overnight so far, this chart might be signaling a move higher for Tuesday.

ES daily pivot: Tonight the ES daily pivot dips from 1862.25 to 1860.58.  After popping above the old number at 3:15 PM Monday, we remain above the new pivot so this indicator now becomes bullish.

Dollar index: On Monday the dollar resumed its odd march lower backwards from last week by dropping 0.07% on a fat green spinning top.  The indicators are not yet oversold though and with a descending RTC in effect and no nearby support, my best guess is there's more downside to come.

Euro: The euro meanwhile continued its rally on Monday with a tall green spinning top  It has only just entered overbought so it looks like the rally isn't over yet.  Indeed the new overnight continues higher in a ruler-straight rising RTC.

Transportation: And finally, indecision was also on display in the trans which lost all of 0.02% on Monday on a classic doji.  Here too  half the indicators are rising and the other half falling.  This all leaves us with no good guidance for this chart at all.


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     12       3      6           0       0.800    431
April      8       3      4           0       0.727    395

     And the winner is...

I had to think long and hard about the charts tonight because we're getting some mixed signals.  In addition to the usual suspects, I'll note that the NYSE A/D line looks like it might be moving higher and the TLT looks like it might be moving lower.  Ultimately, while the situation isn't all that clear tonight I think we have enough evidence, just barely, to call Tuesday higher.

ES Fantasy Trader

Portfolio stats:  the account remains at $111,625 after three trades in 2014, starting with $100,000.  We are now 3 for 3 total, 2 for 2 long, 1 for 1 short.  Tonight we stand aside - this is far from my ideal trade entry and I want more of an edge before committing again.

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