Friday, January 23, 2015

Friday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Friday uncertain.
  • ES pivot 2045.00.  Holding above is bullish
  • Next week bias uncertain technically.
  • Monthly outlook: bias lower.
  • Single stock trader: VZ not looking bullish.

The big day finally arrived on Thursday.  The ECB spaketh and Mr. Market stood up shouting "Hallelujiah!" and celebrated by tacking on another 260 points.  Yowsa - I'll take it.  OK, folks - there's still a bunch of central banks we've yet to hear from.  It's still not too late to join the race to the bottom, and help my bottom line.  So will we give it all back on Friday?  Let's see what the charts have to say about that.

Karma Korner

Today we celebrate the news that Sheldon Silver, the longtime speaker of the New York State Assembly has (finally) been arrested on charges of bribery and kickbacks.  And no piker he, we're talking big time, as in the multi-millions of samolians here.  Oink oink!  All I can say is, couldn't happen to a more deserving guy.  Now maybe, just maybe the long-suffering people of New York can get what they deserve - honest government.

Mr. Silver, the time has come for you to pack your bags and sail off into the sunset.  I call for you to resign from the legislature immediately.  New York has had it up to here with you and your ambulance-chasing cronies over the past 21 years.  And to all the Democratic sycophants (you know who you are) lining up to support this gentleman, you're all worse than he is.  A pox on all of you.  Foo!

The technicals

The Dow:  The Dow's 1.48% gain Thursday put the lie to everyone who was saying the ECB move was already somehow baked in.  We had the best day in three weeks, remain in a new rising RTC with all indicators rising off oversold.  What's not to like?  This chart is plain bullish here.

The VIX:   Last night I wrote "there are still no bullish signs on this chart." and the technicals prevailed with a 13% plunge in the VIX Thursday.  The indicators continue moving lower and are now getting close to oversold.  We remain in a descending RTC and the candles have taken on the look of a falling inverse exponential.  This all leads me to believe a reversal is coming but I still think there's at least a bit more downside at hand.  Friday might be a doji day.

Market index futures: Tonight, all three futures are lower at 12:30 AM EST with ES down 0.15%.  ES obviously had a great day Thursday stopping only at resistance around 2056.  Indicators all continued rising but have not yet reached overbought.  But we've now reached the "show me" zone.  After a stellar four day rally, does ES have the moxie to push even higher on Friday?  I'm not convinced.

ES daily pivot: Tonight the ES daily pivot jumps from 2021.50 to 2045.00.  Even at that we remain above the new pivot, though ES seems to be fading.  So for now anyway, this indicator remains bullish.

Dollar index:  The mighty dollar, as might be expected had its best day since, uh, sometime in 2011 as far as I can see with a massive 1.31% moonshot marubozu  to close above its upper BB.  That crushed resistance back to 2010.  The last time we had a monthly close here was March 2009.  The indicators are all back to overbought but as we've been seeing, that counts for little here. There seems to be no stopping the dollar now.   Still, after such a big move, a bit of retracement might be in order.

Euro:  Meanwhile, the euro was just hammered on Thursday to close at 1.1365.  If this keeps up, my call for parity by the end of the year could be conservative.  We're already back to September 2003 levels now, just a few years after the creation of this franken-currency.  And at the risk of sounding like a broken record, the end is still nowhere in sight.

Transportation:  Last night I wrote "there's still room to run here on Thursday" and was there ever.  The trans on Thursday had the biggest day of all, up a whopping 2.87% on  a jolly green giant marubozu.  There's now nothing bearish on this chart other than the fact that a pause is often in order after such large one-day gains.  With resistance at 9223 not too far away, a topping day is not out of the question here.


Month    right  wrong  no call  conditional  batting   Dow
                                             average  points

January    8      3       1           1       0.750

     And the winner is...

Hmm, I don't know.  While there are no signs of a top just yet, the overnight futures seem to be running out of gas.and we're now sitting right on a number of resistance points.  I'd love to call the market higher but there's a little voice saying "Don't do it, Michele".  After a nice rally and a big up-day Thursday, traders might want to book profits going into the weekend.  So I'm going to content myself with simply calling Friday uncertain.  We could get a doji day.  That's all she wrote.  See you again Sunday night!

Single Stock Trader

Well VZ certainly took an unexpected (by me anyway) turn on Thursday with a nearly 1% loss to fall out of its rising RTC for a bearish setup and a bearish stochastic crossover.  It's looking more like a short right now.

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