On vacaction Friday

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

No Hoot - on vacation.

Recap

Wow - what a snoozer of a day - Dow down 17 points, SPX down 5.35.  Yaaawn!  I'm glad I called Thursday "uncertain" because with one doji after another, there's really no good way to tell if they're going to be red or green.  It looks like a lot of the big boys decided to take the whole holiday week off, and I should have done the same.  But at least there's still some time left  for me to get in one day off on Friday and I'm taking it.  So the Night Owl will be back as usual on Sunday night.  See you then!

Accuracy:

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
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  0       1      1           0       0.000    -31


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.

Thursday uncertain

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

• Thursday uncertain.
• ES pivot 2002.00.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

Ah - this was the result I was waiting for.  Persistance paid off on Wednesday and although it was a nail-biter into the close, the Dow did end higher, if only by 11 points after bouncing right off its pivot at 3:02 PM.  So with that out of the way, the holiday-shortened week meanders on and we look to Thursday for some action.

The technicals

The Dow: The Dow's meager 0.06% gain on Wednesday belied the candle - a giant .(and rare) gravestone doji coming after a downtrend.  But the indicators remain confused and the stochastic continues to decline.  So with this conflict I'm afraid I have to let this chart pass tonight.

The VIX:  And on Wednesday the VIX did not decline as expected, gaining instead 0.90%. on a bullish engulfing pattern following Tuesday huge gravestone doji.  So with indicators now overbought and the stochastic having just barely formed a bearish crossover, I'll say once again, I think the VIX looks lower from here.

Market index futures: Tonight all three futures are essentially flat at 12:06 AM EDT with ES and YM both down down one tick but NQ up 0.01%.  Overall, ES continues to be range-bound, bouncing around the 1999 level.  Wednesday saw a big intraday push above 2000 but it was ultimately rejected.  So this chart continues to crawl sideways and that's all I have to say about that.  OK, just one more thing - the overall appearance at the moment is a tad on the bearish side.

ES daily pivot: Tonight the ES daily pivot rises from 1999.58 to 2002.00.  This marks another new record - the first time the ES pivot has surpassed 2000.  But that leaves ES below the new number so this indicator is now back to bearish.

Dollar index:  Last night I wrote "my guess would have to be that the dollar goes lower on Wednesday" and it did, down 0.15% on a tall inverted hammer.  To me that satisfies the basic evening star pattern and with indicators remaining overbought, and a still considerable gap remaining below, I'd hazard that the selling isn't over yet.


Euro: Well whadaya know about that - the euro actually ended up for a change, closing at 1.3146 on Wednesday to confirm Tuesday's star. That sends all the indicators higher, now just off oversold and with the overnight teetering on the edge of the descending RTC for a bullish setup, it looks like maybe, just maybe the euro could go higher again on Thursday.

Transportation:  I got so excited by the trans' big gain on Tuesday that I completely forgot the old maxim that the market likes to take a pause after large run-ups, and that's just what happened on Wednesday with the trans giving up 0.23% on Tuesday's rocketship.  But that barely makes a dent in the larger picture.  We now have a completed bullish stochastic crossover  and a bullish RTC exit.  But we have to balance that against a spinning top, so it's a wash.  No call here tonight.

Accuracy:

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
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       1      0           0       0.500    -20

     And the winner is...

Tonight I see a general lack of direction in the charts and I'm just not feelin' the love, baby.  So therefore the only clear course of action is to call Thursday uncertain.  My overall impression is vaguely bearish, but not enough to make a formal call that way.

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.

Wednesday higher

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

• Wednesday higher, low confidence.
• ES pivot 1999.58.  Holding above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

Well I guess that's what I get for overriding my own analysis and trying to get smart.  On Tuesday, the market went lower after all.  Live and learn, or sometimes not even learn.  Anyway, let's now give Wednesday a shot now that we have some fresh charts to look at.

The technicals

The Dow: So the Dow dropped 31 points on Tuesday, pretty much confirming what I said last night: "The first day of most months has a bullish bias, but not particularly in September".  Maybe now I'll listen to myself. While the numbers weren't large, the trend is now clearly lower, and we set up a new descending RTC with a decent Pearson's of 0.921.  But we still have five reversal warnings in a row, Tuesday's being another hammer.  But the indicators are still only barely coming off overbought and the stochastic is in full-blown retreat right now so I'd have to say this chart now looks bearish.

The VIX:  The most surprising chart of the day was the VIX, whose 2.25% gain belied a giant gravestone doji that very nearly touched the 200 day MA. It also sent the indicators to almost overbought.  The overall impression here is that the VIX is unable to gain much traction right now and lower looks likely.

Market index futures: Tonight all three futures are higher at 12:31 AM EDT with ES up 0.09%.  Since ES exited its rising RTC three days ago it's been doing a lot of indecisive vacillating.  This may be partly just due to the pre-holiday week.  Tuesday gave us a nice doji and the overnight is guiding higher - a bit more convincingly than last night.  But there's still a lot of indecision apparent on this chart.  I don't want to repeat last night's mistake so I'm just going to let this one go by.

ES daily pivot: Tonight the ES daily pivot ticks up from 1999.17 to 1999.58.  We're now above the new pivot so this indicator turns bullish.

Dollar index:  Last night I wondered if the dollar has any gas left in the tank for Tuesday.  Well it did have another 0.27% to generate a second spinning top.  We now have an unusual binary-twin evening star in the making here.  With two reversal warnings, overbought indicators, and an inability to push much higher,my guess would have to be that the dollar goes lower on Wednesday.

Euro: Meanwhile,t he poor downtrodden euro just kept going lower on Tuesday to close at 1.3127.  It was though with a small star though we've seen plenty of those go by lately to no effect. The downtrend remains intact and this isnt' enough to call a reversal yet.

Transportation: OK, I take it back - the most surprising chart on Tuesday was not the VIX, it was the trans, which popped an impressive 1.29% on a day the Dow was down. That generated an instant bullish RSI setup, heck, let's just call it a trigger  given the fact that this marubozu also blasted past resistance at 8461 and even closed at a new all-time high.  With a bullish stochastic crossover now created and the upper BB way up at 8628, this chart looks bullish - Dow Theorists take note.

Accuracy:

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
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  0       1      0           0       0.000    -31

     And the winner is...

It's not quite clear to me where Tuesday's lower number came from, especially given some BTE economic news.  The Nasdaq did finish higher.  But the net effect is that tonight actually looks stronger than last night, so I will crawl right back out on that limb and call Wednesday higher.  Hey, I've got to be right some time.

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.

Tuesday higher

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

• Tuesday higher, low confidence.
• ES pivot 1999.17.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

I hope everyone had a relaxing Labor Day weekend.  Now it's time to get back to the grind.  I do have half a mind though to just take the rest of the week off, it being holiday-shortened and all.  But this holiday coming at the start of the month is different, so we might as well run the charts, though most of them are rather out of date by now.  Perhaps I'll take Wednesday off.  That's the nice part about being retired - I can make my own holidays whenever I want.

The technicals

The Dow:  So last Friday, if anyone remembers that far back, the Dow alternated between gains and losses before ending up all of 19 points.  It was a good day to call "uncertain", and with the puny volume, an even better day to spend in the back yard on the chaise lounge sipping Pina Colada. Technically though, we now have two whole days outside the rising RTC so that's a bearish trigger.  And the candles sort out as spinning top, and then two hanging men.  Indicators remain oversold and the stochastic just gave us a bearish crossover, so I have to think this chart looks bearish on Tuesday.

The VIX:  When last seen, the VIX confirmed last Thursday's inverted hammer with a 0.58% drop on  - wait for it, another inverted hammer.  We do though have a bullish trigger on an RTC exit, analogous to the Dow, so with indicators rising off oversold it looks like more upside from here..

Market index futures: Tonight all three futures are higher at 12:32 AM EDT with ES up 0.05%.  Last week, ES put in three consecutive dojis but still zig-zagged higher even as the world around it appeared to be going to pot.  Friday finished strong and we now have 2000 below us as support.  But like some other charts, we've exited a rising RTC for a bearish trigger.  This chart just doesn't look particularly bullish to me tonight.

ES daily pivot: Tonight the ES daily pivot rises from 1994.58 to 1999.17.  We are now above the new pivot so this indicator turns bullish.

Dollar index:  Last Friday the dollar convincingly put an end to what looked like a trend change by gaining 0.32%, largely due, I suspect to geopolitical issues.  With indicators remaining overbought, it's not clear that there;s much upside left on Tuesday, though that's far from clear.

Euro: And the euro took a corresponding dive on Friday to close at 1.3135, a level we haven't seen in a year.  And the new overnight does nothing to change that.  With no reversal signs here, the euro just looks set to keep going lower.

Transportation:  The trans have now clearly topped, a week ago and on Friday, non-confirmed Thursday's hammer with a small spinning top on a meaningless 0.03% gain.  We've been losing ground slowly here for a week now and indicators are finally oversold but the stochastic hasn't yet gotten into position for a bullish crossover so this chart is a toss-up for Tuesday .

Accuracy:

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
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

     And the winner is...

The first day of most months has a bullish bias, but not particularly in September.  And while August gets a bad rap for the market, my experience is that in the last 10 years, September and October have been far worse.  Tonight we're in a difficult spot because most of the charts are three days old now and they were generated on very light volume on top of that.  So while they in general do not look particularly bullish the futures, which are current, seem to be guiding higher and the developing candle is in fact a nice bullish engulfing pattern.  So I'm going to go out on a limb and called Tuesday higher.  We'll see.

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.