Friday higher

The Hoot 
Actionable ideas for the busy trader delivered daily right up front

• Friday higher, low confidence.
  
• ES pivot 1847.50.  Holding above is bullish.
• Next week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

I'm glad I called Thursday as uncertain because there was really no way (that I could see) of figuring out which way the previous two doji days would resolve.  Turns out is was to the upside and that has interesting implications for Friday which will will get to with no further ado.

The technicals (daily)

The Dow: The Dow seems to be in stair-step mode now, with brief sideways moves followed by short pops higher.  With no bearish reversal signs in sight, the upper BB not til 16,467, and the indicators actually turning higher again, it looks like this pattern is set to continue for a while.

The VIX:  Last night I wrote "the VIX may want to take a peek at its 200 day MA again on Thursday at 14.64, this time as resistance", and that is just what happened on Thursday.  The VIX hit a high of 14.69 and that was basically the end of it, as it finished down just over 2%.  That keeps it in ts descending RTC and makes for a jim-dandy dark cloud cover.  With the MA rejected, lower again looks likely on Friday.

Market index futures: Tonight all three futures are lower at 12:41 AM EST with ES down by 0.13%.  ES had a pretty good day Thursday, breaking the 1850 mark as it pushes back into record territory again.  That was enough to drive the indicators overbought, but lately that's not an instant reversal sign.  The mode now seems to be for up days to be followed by consolidation, so that's not out of the question here.

ES daily pivot: Tonight the pivot rises from 1844.42  to 1847.50.  We remain above the new pivot so this indicator is still bullish.

Dollar index: I couldn't make much sense of this chart last night and on Thursday the dollar pretty much just went back over the same ground, down 0.20% to end just under where it started Wednesday.  But that's still good for a bearish engulfing pattern and a stochastic that's moving close to a bearish crossover.  So I'll take a wild guess that the dollar goes lower on Friday..

Euro: On Thursday the euro gave us a green hammer that nonetheless drove the indicators closed to oversold.  But the overnight is falling again and is about to break under the new pivot.  But tonight it's this chart that's too hard to parse, so I'll take a pass here.

Transportation: he trans got back into gear on Thursday with a nice 0.59% gain to form a bullish engulfing pattern that just cracked the descending RTC for a bullish setup  Indicators remain somewhat of a mixed picture but overall this chart is at least somewhat bullish now.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   4       2      2           1       0.714     58

     And the winner is...

The last day of the month is generally good, though in February it's just average.  In any case, tonight we have sort of the same thing as two nights ago, an absence of bearish signs more than anything looking strongly bullish.  So I guess all I can do is call Friday higher, though I'm not expecting any triple digit advances.  See you again Sunday night!

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.

Thursday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front

• Thursday uncertain.
  
• ES pivot 1844.42.  Holding above is bullish.
• Friday bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Quote of the Day

"It's hard not to think that the real problem in Bitcoinland isn't denial-of-service attacks. It's denial."

      -  The Economist, on Bitcoin (whatever the heck that is) after the collapse of Mt. Gox (whatever that was).

Recap

Another one of these zig-zaggy days on Wednesday as the Dow gave up some AM gains in early afternoon selling but managed nonetheless to recover by the close to save my call for an up day.  So on we go to Thursday as we tackle tricky tactical technicals (say that three times fast).

The technicals (daily)

The Dow: The Dow has now given us two spinning tops in a row but no break lower.  With Wednesday's being something of a bullish harami and RSI now off overbought, it would seem not entirely implausible to get another leg higher form here.

The VIX:  Huh - I thought the VIX might visit 13.44 on Thursday but no such luck as it actually gained 5% in an unusual positive correlation to the market with a bullish one-white soldier candle.  Nonetheless we remain in a descending RTC and the stochastic is not yet in position for a bullish crossover.  That said, I now think the VIX may want to take a peek at its 200 day MA again on Thursday at 14.64, this time as resistance.

Market index futures: Tonight all three futures are higher at 12:05 AM EST with ES up by 0.18%. Wednesday's ES candle was a wide-ranging bearish engulfing spinning top.  The indicators seem to support a reversal from here as they continue drifting lower off overbought, but the pin-action tonight suggests otherwise and we do remain inside a week-long rising RTC.  So with mixed signals, this one's a push.

ES daily pivot: Tonight the pivot barely moves from 1844.83  to 1844.42.  We're still above the new pivot, though not by much, so for the time being this indicator is bullish, just barely.

Dollar index: I missed this one completely with the dollar gapping up 0.37% on Wednesday, not moving lower.  We're now out of a month-long descending RTC but this chart is just too herky-jerky for me, especially with indicators neither overbought nor oversold..

Euro: The euro finally broke out of its week-long consolidation and after five dojis in a row it took a big dump on Wednesday down to 1.3683.  That drove RSI oversold but the stochastic is still falling.  Support at 1.3697 is now resistance so I wouldn't be surprised to see at least a bit more downside, though honestly, this chart is really too tough to call.

Transportation: A bit of bearish divergence here as the trans lost 0.25% on Wednesday while the Dow gained 0.12%.  It was on a spinning top but it also formed a bearish stochastic crossover, so more downside could be coming here.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   5       2      1           0       0.714     58

     And the winner is...

With not just a lack of clear direction but a number of contradictory signals in the charts tonight, I'm afraid I'm just going to have to declare Thursday uncertain.  Maybe a more clever technician than I can make sense of this mish-mosh, but I can't - and I'm not going to lose any sleep over it.  There's no need to play these low percentage plays.

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.

Wednesday higher

The Hoot 
Actionable ideas for the busy trader delivered daily right up front

• Wednesday higher, low confidence..
  
• ES pivot 1844.83.  Holding above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

Last night I made a conditional call for Tuesday, that we'd close higher only if ES managed to stay above its pivot by mid-morning.  ES, which dipped below the pivot around 3 AM did make a half-hearted attempt to break back above around 10:45 AM but by the time it finally got in gear it was too late and both the Dow and SPX did eventually close a bit lower.  So let's move on and see what the charts have to say about Wednesday.

The technicals (daily)

The Dow: The Dow continues to be frustrated by resistance around 16,250, ending Tuesday with a red spinning top and a failed high level bullish stochastic breakout.  But with the upper BB still still over 200 points away, we could just as easily continue higher.  However, the spinning top requires confirmation so I'm just going to have to wait and see on this one.

The VIX:  Last night I wrote about the VIX "you've got to think this one's going lower" and if you thought that you'd have been right because that's just where it went - down another 4% on Tuesday with an inverted hammer that tried and failed to recover the 200 day MA.  With an admittedly wide descending RTC now in place and a bearish stochastic crossover complete, and no sign of a reversal from VVIX, I'm not sure there couldn't be still more downside to come on Wednesday, at least to 13.44 where there's some support. 

Market index futures: Tonight all three futures are higher at 12:22 AM EST with ES up by a decent 0.27%.  That's enough to keep it firmly inside a rising RTC and provides a non-confirmation of Tuesday's spinning top.  The indicators are sort of wandering, with RSI flat just in overbought, momentum falling, but money flow and OBV rising.  And the stochastic is threaded out, with both lines virtually on top of each other, so no help there.  But the overall trend remains bullish.

ES daily pivot: Tonight the pivot inches up from 1844.00  to 1844.83.  After finally breaking above the pivot just before the close, we remain well above the new number so this indicator is now clearly bullish

Dollar index: I couldn't call this one last night and it was just as well since the dollar lost a scant 0.07% on Tuesday, and on a green spinning toppish/hammer.  Largely just more indecision.  Tonight though, we're seeing a nascent bearish stochastic crossover.  So although RSI is just coming off oversold, I'm going to guess that maybe the dollar goes lower on Wednesday..

Euro: Last night I wrote "more sideways drifting seems to be ahead" - and that's just what happened as the euro put in its fourth doji in a row, continuing to oscillate around the 1.3741 level.  With the indicators remaining overbought, the break (when and if it ever comes) would seem to be more likely headed lower.  But so far in the overnight, it just looks like more of the same consolidation.

Transportation: And while on Tuesday the Dow lost just 0.17%, the trans lost 0.67% on what as close to a bearish engulfing candle that got the stochastic into position for a bearish crossover.  ll in all, this chart now swings to bearish.


Accuracy (daily calls): 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   3       2      1           0       0.600     39

     And the winner is...

Tonight the charts seem generally bullish, despite the fact that the end of February historically underperforms.  Not a raging bull, mind you, but nonetheless enough for me to call Wednesday higher.

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.

We're back, baby!

The Hoot 
Actionable ideas for the busy trader delivered daily right up front

• Tuesday higheronly if ES stays above pivot, else lower.
  
• ES pivot 1844.00.  Holding above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside..

Recap

Well the Olympics are finally over and after OD'ing on everything from figure skating to hot dog skiing for two solid weeks,  I'm slowly starting to recover   So we fondly bid adieu to all the winners and the lugers (that joke just never gets old, does it), and it's time to return to that other endlessly entertaining circus called the stock market.  So let's get right to it, as Team Night Owl goes for the gold and a winning forecast for Tuesday.  We're back, baby!

The technicals (daily)

The Dow: Last week, the Dow dropped out of its rising RTC but the bearish setup never got a trigger and instead we got Monday's Rally of Nothing.  Or was it?  We saw high volume and a bullish stochastic crossover from a high level.  So with no resistance til 16,250, I have to think there's still some upside left here, like the Dutch speed skating team.

The VIX:  This chart was even more clear - a classic bearish stochastic crossover on Monday with a 3% drop that sliced right through the 200 day MA and hey you've got to think this one's going lower than the US men's hockey team.

Market index futures: Tonight all three futures are just a tad lower at 1: AM EST with ES down by 0.07%.  ES had a good day Monday with a bullish engulfing candle that finally managed to crack resistance at 1843 that had stood in the way all year so far.  The indicators are just overbought but haven't been terribly useful lately.  And the upper BB isn't til 1871, so more upside is possible here though the lack of pin action in the overnight does raise an eyebrow.

ES daily pivot: Tonight the pivot rises from 1837.00  to 1844.00.  That leaves ES just barely above the new pivot.  While this is still marginally bullish, ES is in easy striking distance should it decide to break under, and that would be bad.

Dollar index: The dollar spent most of the Olympics falling faster than Bode Miller on the downhill until last Thurday.  But that breakout didn't hold and now it looks like it wants to move lower again.  But the indicators remain oversold so this chart is sort of a conundrum wrapped in an enigma.  I'll need the photo finish to figure out this one.

Euro: The euro is similarly conflicted, having now put in four dojis in a row around 1.3740.  In the absence of any RTC or a clear direction, more sideways drifting seems to be ahead.

Transportation: A note of caution here.  On Monday the trans posted a decent 0.44% gain but did it on an inverted hammer that touched the upper B.  The only saving grace is that we're still a ways from overbought o this isn't automatically fatal.  But we still need to wait for the second run down the track to see if this time will hold up.


Accuracy (daily calls): 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   3       2      1           0       0.600     39

     And the winner is...

I'm a bit worried about things looking somewhat overbought at the moment, but the overall patterns remain bullish, or more to the point, they don't look bearish.  I'm feeling a bit half-hearted about it all, particularly with ES's proximity to its pivot.  So I'm going to make it a conditional call: Tuesday higher onyl if ES manages to stay above its pivot by mid-morning, else 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.