Tuesday, January 20, 2015

Tuesday higher

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Tuesday higher.
  • ES pivot 2011.75.  Holding above is bullish
  • Rest of week bias uncertain technically.
  • Monthly outlook: bias lower.
  • Single stock trader: waiting on new VZ entry.

Well after a three-day weekend, there's not much to recap.  However, we'll cut right to the chase because the big news this week is the imminent announcement of QE from the ECB and that's sure to be a market mover.  So just bear in mind that  my call right now is entirely modulo ECB.

The technicals

The Dow:  On Friday the Dow had a nice day with a bullish engulfing pattern that just touched its lower BB.  The stochastic is close to a bullish crossover.

The VIX:  On Friday the VIX put in a classic bearish engulfing pattern that just touched the upper BB for a 6.43% loss and a bearish stochastic crossover .  So this one looks lower Tuesday.

Market index futures: Tonight, all three futures are higher at 12:18 AM EST with ES up  0.15%, perhaps in anticipation of an ECB move.

ES daily pivot: Tonight the ES daily pivot rises again from 1999.17 to 2011.75. Even at that we remain above the new pivot so this indicator remains positive.

Dollar index:  On Friday the dollar broke out of a seven day congestion zone but with an inverted hammer that just touched its upper BB.  This might be a sign of a move lower, but lately that's always a risky call.

Euro:  The euro just keeps right on sinking.  Nothing to see here, move along...

Transportation:  Like everything else the trans on Friday made a big bullish engulfing candle, up 1.25%, turning all the indicators upwards.  This one looks like there's more upside left.


Month    right  wrong  no call  conditional  batting   Dow
                                             average  points

January    5      3       1           1       0.667

     And the winner is...

Technically, I'm seeing enough positive signs to call Tuesday higher.  But that's all pending whatever the ECB announces.  QE comes out, we look like heroes.  No QE and we're zeros.  For that matter, it may not happen on Tuesday at all.  It's just wait & see right now.

Single Stock Trader

VZ had an unexpected breakout on Friday that took it right to its upper BB.  We missed that move.  But seeing as we're now overbought and at resistance, I want to wait and see what Tuesday brings here.

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