Monday higher

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

• Monday higher.
• ES pivot 2091.58.  Holding above is bullish
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• Single stock trader: VZ a cautious buy.

Recap

On Friday the market had  a second workman-like advance, notable mainly because it finally popped the Dow past its week-long resistance at 17,952 to reclaim the 18K mark again.

The technicals

The Dow:  Last Thursday night I wrote "we just have to go with this choppy uptrend." and good thing too because the Dow gained almost another 100 points on Friday propelled in large part by GE whose nearly 11% gain had the Night Owl doing the happy dance since GE is one of my core holdings.  But that was then this is now.  So we go back to the well to see what sort of charts we can winch up for Monday.

The VIX:  Well I missed this one.  I'm not sure now why I thought the VIX might go higher last Friday but it did go lower instead, finishing right on its lower BB with the indicators all highly oversold and breaking support at 13 in the process.  So while it looks ready to reverse indicator-wise, we still don't have a candle  reversal sign so I can't call the VIX higher just yet.

Market index futures: Tonight, all three futures are lower at 12:17 AM EDT with ES down 0.07%.  On Friday ES extended its gains to make it three in a row.  Indicators are now pretty overbought and the overnight is sagging a bit but we remain solidly in a tight rising RTC and with the upper BB nearby at 2106.13, I expect ES to touch that level on Monday.  That is coincidentally also a resistance line, so we could get a topping day.

ES daily pivot: Tonight the ES daily pivot rises from 2080.00 to 2091.58 With a flat ES in the overnight that leaves us above the new pivot so this indicator is now bullish.

Dollar index:  The dollar gapped up again Friday 0.20% but on a red candle.  Indicators are close to oversold so we have a hint of a reversal here but not a strong one.

Euro:  Meanwhile the euro is back in a steep descending RTC, down again to 1.0613 as the Parityville Express seems to be back on track once again.  And the Sunday overnight is also lower.  The lower BB is at 1.0593 and I expect the euro to hit that on Monday.

Transportation:  Last Thursday night I wrote "there's still a lot of room to run higher here" and that's just what the trans did, up another 0.68% to make it four in a row.  Indicators continue to rise but are not yet overbought and we have a steep rising RTC going.  Next resistance is at 8791 but I expect the trans to test that level on Monday.

Accuracy:  

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      7      6       5           4       0.647    976
April      1      2       3           0       0.333    -40

     And the winner is...

It kind of makes me nervous to say this but I'm not actually seeing any technical signs of a move lower in the charts tonight.  Sure ES is down a bit but we've seen that sort of action reverse the next day recently.  We're near enough to some key resistance lines though that a reversal might be in the offing soon but for now I guess all I can really to is call Monday higher.

Single Stock Trader

On Friday VZ retested its 200 day MA and this time it succeeded with a stubby candle that confirmed Friday's bullish harami.  With a stochastic beginning to curve around for a bullish crossover, I'd give this a cautious green light for a swing buy now.