Tuesday, September 16, 2014

Tuesday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Tuesday uncertain.
  • ES pivot 1981.17.  Holding above is bullish.
  • Rest of week bias uncertain technically.
  • Monthly outlook: bias higher.
  • ES Fantasy Trader standing aside.

I called Monday lower and I was right - for the SPX.  But for the Dow, my benchmark, it's just another miss as the Dow continues to act squirrelly.  In fact this whole week will be a challenge, what with a Fed announcement and options expirations.  We carefully thread our way through the minefield in an attempt to avoid blowing up our account.  Now which way is Tuesday headed?

The technicals

The Dow: The Dow chart lately has been a veritable picket fence of candles with long shadows as early intraday moves get canceled by the time the bell rings.. Nevertheless, there's no denying the wobbly downtrend we're in now.  Monday's action almost, but not quite exited the descending RTC, which would be a bullish setup.  And the indicators continue to wander about aimlessly.  There's no real direction here so I'm not calling this chart tonight.

The VIX:  Like an Olympic hurdler, the VIX on Monday leapt to its 200 day MA after four consecutive failed attempts, and never looked back to end with a 6% gain.. That level (13.57) now become support as the VIX remains firmly inside a rising RTC and the indicators have yet to reach overbought.  SO there's no sign of a move lower here.

Market index futures: Tonight all three futures are basically flat at 1:08 AM EDT with ES up by just one tick and YM up 0.03%.  On Monday ES put in a fair tomahawk pattern and finally hit oversold.  It simultaneously managed to close just outside its descending RTC for a bullish setup.  The indicators look ready to reverse but the overnight is offering little guidance, so I'm going to wait and see on this chart.

ES daily pivot: Tonight the ES daily pivot drops from 1987.83 to 1981.17.   Despite ES going nowhere, that was enough to put it back above the new pivot, so this indicator now flips back to bullish.

Dollar index:  The crab market continues in the dollar (only moves sideways) as we got the fifth day in a row of going essentially nowhere.  We're long out of th3 rising RTC and still way overbought so one would think the next move ought to be lower - if we ever start moving again.

Euro:  The euro on the other hand is now in a shallow rising trend despite a loss on Monday. That leave sit right on the cusp of a long-running descending RTC.  Tuesday will be key here to see if the euro can eke out at least a small gain to escape the downtrend.  And having just retaken its daily pivot, that just could happen.

Transportation: Last night I wasn't ready to commit to the obvious reversal star hanging over the trans.  Too bad because on Monday the trans dropped 0.36%  to start off the new week with a bearish evening star.  With indicators still closer to overbought than oversold, there's really nothing bullish about this chart.


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      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       8      10      3           2       0.500    132
July       6       4      4           3       0.692    639
August     8       7      2           2       0.588     81

September  1       6      1           0       0.143   -139

     And the winner is...

The charts don't really seem to be painting a convincing picture either way tonight.  Perhaps the pre-Fed jitters are setting a day early this week.  In any case, I've had enough of going out on a limb for a while and having it crack beneath me so I'll just call Tuesday uncertain.

ES Fantasy Trader

Portfolio stats:  the account remains $114,250 after eight trades in 2014, starting with $100,000.  We are now 6 for 8 total, 4 for 4 long, 2 for 3 short, and one push.  Tonight we stand aside.

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