Thursday lower

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

• Thursday lower.
• ES pivot 2034.00.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias lower.
• Single stock trader: VZ topping.

Recap

The roller coaster ride continued Wednesday as we were up 100 and then down 60 and in the end the Dow finished all of 7 points higher.  Crazy stuff.  So let's see how this changes the charts as we look forward to Thursday.

The technicals

The Dow:  After all the sturm und drang was over, the Dow ended just about where it started Wednesday, forming a perfect doji and in evening star position.  With indicators now approaching overbought this is a reversal warning worth heeding.

The VIX:  Ya, the VIX got me Wednesday.  Instead of continuing lower, it gained 5.77% on a green hammer.  But the indicators are wandering.  RSI and momentum were higher but the stochastic continued lower.  This one is too tough to call tonight.

Market index futures: Tonight, all three futures are lower at 12:17 AM EST with ES down 0.15%.  ES gave up ground on Wednesday with as fat red spinning top on a vaguely dark cloud cover candle.  But the indicators remain confused with momentum and OBV moving lower but RSI and money flow moving higher and none of them at either extreme.  That all leaves this chart a conundrum.

ES daily pivot: Tonight the ES daily pivot rises from 2031.00 to 2034.00.  But now we're below the new pivot so this indicator turns bearish.

Dollar index:  Last night's bearish stochastic crossover is coming to an end as on Wednesday the dollar ended gaining 0.47% on a bullish harami making me wonder if that's all there was to this recent pullback.  And all the indicators have started rising off oversold.  So the next logical move is higher.

Euro:  And the euro put in a hanging man on Wednesday giving up a quarter of Tuesday's gains. and forming a bearish stochastic crossover.  That all looks bad and indeed the overnight is already gapping down 0.57% making a lower close look likely on Thursday.

Transportation:  Like the Dow, the trans put in their own star Wednesday implying a possible reversal here too.

Accuracy: 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   2      0       1           0       1.000    203

     And the winner is...

The charts are being particularly opaque tonight.  We have some topping warnings but they all require confirmation.  I'm revising this post to call Thursday lower, mostly on Greek ECB fallout  And I'm still not going long from right here.

Single Stock Trader

VZ also put in a topping star on Wednesday making me think I was right to exit on Tuesday.  I left a bit of money on the table but the alternative would be to sit in front of my computer all day waiting for the top and I just have too much other stuff to do for that.  That becomes day trading, not swing trading.  Anyway, I'm expecting a move lower from here.