Thursday, February 19, 2015

Thursday depends on ES pivot

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Thursday higher only if ES stays above its pivot, else lower...
  • ES pivot 2094.17.  Breaking above is bullish, below is bearish.
  • Friday bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ moving still lower.

Wow - Wednesday was pure scalper's heaven with Mr. Market bobbing up and down in a series of clearly defined intraday trends as the Fed minutes rippled through the Street.  But for swing trading, it was just a big dud.  I'm glad I called it uncertain as there was no way to figure out last night where this roller coaster was going to stop.  Now let's just see where this week ends up a we move on to Friday.

And oh, I almost forgot - last night was the Night Owl's fifth anniversary.  Five years continuous of my nightly rants.  Doesn't seem like a day over 10.

The technicals

The Dow:  If you just look at the final candle, on Wednesday the Dow handed us a little red hanging man significant only because that makes it two in a row now.  Back to back hanging men are always better than one.  So with a failure to advance past resistance and indicators remaining highly overbought, I have to think the next move is lower here.

The VIX:  How odd.  Tuesday we had the Dow and the VIX both up.  And on Wednesday they were both down - highly unusual.  And the VIX was down a good 2.22% for a bearish engulfing candle.  It's not really the evening star pattern I mentioned last night  but it looks bearish nonetheless.

Market index futures: Tonight, all three futures are mixed at 12:12 AM EST with ES down 0.06% but NQ up 0.04%  ES ended little changed on Wednesday but the candle was a tall dagger that traded outside a steep rising RTC.  Add in highly overbought indicators and that's a good reversal warning for me.  The overnight seems to be confirming that idea too.

ES daily pivot: Tonight the ES daily pivot rises again from 2091.83 to 2094.17. That move leaves ES sitting smack dab on top of the new pivot so we have no guidance here.  Being bullish or bearish will depend on which side of the fence it falls on.

Dollar index:  On Wednesday the dollar gained 0.12% but on a red spinning top.  But it was enough to close outside its descending RTC for a bullish setup.  And with indicators close to oversold, this one looks vaguely bullish (though I'm not 100% convinced).

Euro:  Meanwhile the euro continues to consolidate around 1.1400.  Nothing to see here until the break and no way to tell which way that may be.  >Shrug<  The indicators continue to rise though so I'm going to guess that the break when it comes will be lower.

Transportation:  In a bit of Dow Theoretic bullish divergence, on Wednesday the trans gained 0.40% to make their winning streak six in a row and remain in a rising RTC.  So with the upper BB way far at 9156 there's nothing bearish on this chart.


Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   5      2       3           2       0.778    246

     And the winner is...

The charts are sort of mixed tonight.  The VIX is looking lower, implying a higher market but the futures are guiding lower.  But with ES sitting right on its pivot that makes it a perfect time for another conditional call.  If ES breaks above its pivot by id-morning Thursday, we'll close higher.  If if breaks lower, we'll close lower.

Single Stock Trader

Last night I wrote "
I don't think the selling is over" and it indeed was not as VZ broke down through its 200 day MA to establish a new falling RTC.  With an MA break and indicators all now falling too, I'd say there's more downside to come here.

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