Thursday, March 26, 2015

Thursday lower

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Thursday lower.
  • ES pivot 2065.08.  Holding below is bearish
  • Friday bias uncertain technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ may go lower again..

Yow, I'm sure glad I called Wednesday lower as the Dow tumbled 293 on some bad economic news.  That leaves the charts at an interesting junction so let's put them on the 5:15 to Glendale and see where they get off.

The technicals

The Dow:  Even this big fall for the Dow wasn't enough to send the indicators oversold.  The lower BB would seem to be the next logical destination at 17,719 and I think that's where we're headed.

The VIX:  Last night I wrote of the VIX that "[a bunch of technical mumbo jumbo] all adds up to a move higher on Wednesday" and wouldn't you know it the VIX popped over 13% on a tall green marubozu that punched right through the 200 day MA, completed the bullish stochastic crossover and sent all the indicators rising off oversold.  With this kind of steam behind it, more upside is not out of the question.

Market index futures: Tonight, all three futures are slightly lower at 12:22 AM EDT with ES down just 0.02%  ES fell right out of its rising RTC Wednesday for a bearish setup and its indicators also fell to nearly oversold levels.  But we're still not near the lower BB at 2029.18 and in four of the last five big sudden drops ES has had, it didn't reverse until it touched the BB.  I'm expecting the same thing here.

ES daily pivot: Tonight the ES daily pivot dives from 2089.67 to 2065.08. And even with that we remain well below the new pivot so this indicator continues bearish.

Dollar index:  The dollar continued its sell-off on Wednesday down another 0.24% but putting in a hammer and its second green candle in a row.  That plus oversold indicators and a stochastic about to form a bullish crossover suggest that a reversal is at hand.  Like I said last night, I still think the dollar moves higher by the end of the week.

Euro:  And similarly, the euro's recent rally appears to be running out of steam in the 1.0986 neighborhood and with overbought indicators and a stochastic about to form a bearish crossover, I'd look for lower here soon.

Transportation:  The trans were hit even harder than the Dow on Wednesday, down just over 2% on a red marubozu that's nearing the 200 day MA at 8642.  Indicators have gone oversold but hte stochastic is not yet forming up for a bullish crossover so I think we could hit the lower BB (which coincidentally is also a support line) on Thursday.


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      4      6       4           4       0.572    637

     And the winner is...

I'd love to be proven wrong since I'm always net long but I'm just not feeling the love from thee charts tonight so I'm just going to have to call Thursday lower again.

Single Stock Trader

I called VZ lower last night and it was, right back through its 200 day MA with falling indicators and a full-blown bearish stochastic running.  I think the selling's not done here yet.

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