Friday, February 20, 2015

Friday lower

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Friday \lower...
  • ES pivot 2094.00.  Holding above is bullish.
  • Next week bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ bottoming soon.

Well the conditional call last night simply did not work out.  ES broke over its pivot on Thursday but due to bad economic numbers, those freakin' Greeks, or whatever, we ended lower anyway.  It's still a good play, just not 100%.  So with that excitement out of the way, let's take a gander at op-ex Friday, always a good time.

The technicals

The Dow:  On Thursday the Dow lost 44 points on a second hanging man in a row and one that closed outside the rising RTC for a bearish setup  We now have three hanging men in a row making me think Mr. Market is trying to tell us something.  And with indicators remaining overbought, it looks like what he's saying is that there's more downside to come.

The VIX:  In continuing divergence, on Thursday the VIX lost 1.04% on a day the Dow was also down.  It also caused a bearish RTC setup.  The overall gestalt of this chart makes it look like it just wants to move lower.

Market index futures: Tonight, all three futures are mixed once again just like last night at 12:30 AM EST with ES down 0.05% but NQ up 0.04%  ES is clearly having trouble advancing from these elevated levels with now three dojis in a row marking failed attempts to move higher.  RSI hit 98.61 on Thursday, the other indicators have actually begun to move lower, and we got a bearish trigger on the rising RTC exit.  The blah overnight suggests little appetite for any push higher on Friday.

ES daily pivot: Tonight the ES daily pivot dips from 2094.17 to 2094.00 even. After crossing the pivot multiple times on Thursday we're now just barely above the new number, so this indicator is slightly positive.

Dollar index:  Last night I wrote "this one looks vaguely bullish".  Turns out I could have been more assertive since the dollar gained a fair 0.25% on Thursday.  Now it was with a gap-up hanging man.  OTOH, we have a stochastic on the verge of a bullish crossover.  That all leaves this chart too tough to call once again.

Euro:  Last night I noted that the euro seemed to be congesting and wrote "I'm going to guess that the break when it comes will be lower.".  Well on Thursday, it was with the euro closing at 1.1368, its lowest lose in four days.  With three lower highs in a row now and indicators still a long way from oversold, I'd say the selling's not over here yet.

Transportation:  On Thursday the trans put in a massive topping indicator in the form of a big gravestone doji that just touched their upper BB before closing right on the edge of the rising RTC, just short of a bearish setup.  We remain highly overbought so I'd have to say the next move is lower form here.


Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   5      3       3           2       0.700    246

     And the winner is...

Friday is op-ex and historically bearish.  And I have to say the charts now seem to be leaning in that direction with the lone exception of the VIX.  However, the past two days the VIX has traded in direct correlation with the market - highly unusual.  So overall it looks like I have to call Friday lower.  That's all, she wrote.  See you again Sunday night!

Single Stock Trader

Last night I wrote "
there's more downside to come here" about VZ.  And there was, down another percent as we gapped down under the 200 day MA.  That also took the indicators off overbought though we remain in a descending RTC.  I think we're nearing a short-term bottom here which would be a good buying opportunity.  But I need to see the reversal first.  So we continue to watch and wait.

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