Monday, March 30, 2015

Monday higher

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Monday higher.
  • ES pivot 2050.42.  Holding above is bullish
  • Rest of week bias higher technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ due to move higher.

Looks like everyone was worn out after a few exciting days last week as the Dow put in a relatively sedate session Friday with a range of only double digits for a change.  Made for some interesting patterns to.  And it should be an interesting week coming up as we end the quarter and being a new month so let's get right to it on this Sunday night.

The technicals

The Dow:  The Dow spent much of Friday trading in a tiny range propped up by its daily pivot.  The net result was a bullish piercing line which left the indicators oversold, curved the stochastic around in preparation for a bullish crossover, and left us near the edge of the descending RTC.  With another reversal candle last Thursday that bounced off the lower BB, this chart looks ready to move higher Monday.

The VIX:  Last Thursday I also pointed to a reversal sign in the VIX and that came to be with a 4.62% decline on Friday to complete a bearish evening star.  The VIX is now nearly overbought having bounced off its upper BB and propped up only by its 200 day MA.  With indicators much closer to overbought than oversold, it looks like it could go lower again on Monday.

Market index futures: Tonight, all three futures are higher at 12:16 AM EDT with ES up  0.38%  On Friday ES put in a green spinning top harami with oversold indicators and a stochastic about to make q bullish crossover.  The overnight is now outside the descending RTC for a bullish setup but oddly is also moving lower.

ES daily pivot: Tonight the ES daily pivot rises again from 2046.83 to 2050.42.  That keeps ES above its new pivot so this indicator continues bullish.

Dollar index:  Well the dollar folled me.  Last Thursday night I thought it was looking higher on Friday.  Instead it dropped 0.17%, perhaps in a simple mean reversion after Thursday's big gain.  In any case we remain oversold and have just exited a descending RTC for a bullish setup so I have to once again think the dollar goes higher on Monday.

Euro:  Similarly my call for a lower euro didn't work either on Friday but the resulting spinning top at overbought levels hanging right on the edge of the rising RTC makes me think the euro's going lower on Monday.  That theory is supported by the overnight action, headed non-trivially lower.

Transportation:  On Friday the trans put in a bullish piercing pattern good for a 0.24% gain that snapped a four day losing streak and formed a new bullish stochastic crossover.  After bouncing off their 200 day MA last Thursday and with now oversold indicators this chart looks ready to move higher on Monday.


Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    8      6       4           1       0.563    627
February   6      4       5           3       0.692    183

March      6      6       4           4       0.625    711

     And the winner is...

Tonight the charts are generally bullish so the clear technical call is for Monday higher.

Single Stock Trader

Last Thursday night I said VZ might be nearing a reversal and that's now looking more likely with a green spinning top harami on Friday that left the indicators oversold, brought the stochastic down into the region form whence bullish crossovers come and send OBV higher for the first time in a week.  We just need a bullish RTC exit to sound the all clear.  In the meantime, I'd say it's now a buy for the adventurous.

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