Thursday, April 2, 2015

Thursday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Thursday uncertain.
  • ES pivot 2049.08.  Holding above is bullish
  • Friday bias uncertain technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ is a swing buy.

Ha!  April couldn't Fool the Night Owl as the market defied history and moved lower on Wednesday just like I said it would last night. Now let us atone for that little bit of hubris by attempting to figure out whither Thursday.

The technicals

The Dow:  On April Fools the Dow dug itself a deep hole early on and then spent the rest of the day trying to climb back out but didn't quite make it.  The result was a nice hammer that with oversold indicators suggests a move higher on Thursday.

The VIX:  In a highly unusual move, on Wednesday the VIX not only fell on a day the rest of the market did too but it put in a giant inverted hammer propped up by its 200 day MA.  With the momentum downward and overbought indicators, I'd say the next move here is lower again.

Market index futures: Tonight, all three futures are lower at 12:19 AM EDT with ES down 0.11%.  ES gapped down on Wednesday but put in a tomahawk ( my name for a hammer that has a bit of an upper shadow sticking out).  Indicators remain oversold and support at 2049 held nicely so there is a possible reversal higher here though the overnight action doesn't really support that idea.

ES daily pivot: Tonight the ES daily pivot fives from 2064.58 to 2049.08. Thanks entirely to the size of that drop, ES is now back above the new pivot so this indicator, for what it's worth, now turns bullish.

Dollar index:  We've been pondering evening stars for the dollar for two nights now and on Wednesday got a result with the dollar losing 0.19% on a gap-down spinning top  to complete a bearish evening star.  With indicators overbought and a stochastic about to form a bearish crossover I'd say the dollar is looking lower on Thursday.

Euro:  The euro managed a gain on Wednesday but it was a stubby green spinning top at the lower end of Tuesday's big plunge so the latest downtrend remains intact.  Calling the euro higher remains risky business, one I'm not undertaking right now.

Transportation:  And finally the trans were hammered again on Wednesday.  They made a test (successful) of the 200 day MA to end with a 0.79% loss and a fat hammer.  With oversold indicators this is a half-decent reversal sign, though one that requires confirmation.


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      0       0           0       1.000     78

     And the winner is...

Meh - the charts seem a bit jittery to me tonight and I'm not getting a good read on them.  We have a number of reversal signs but they all require confirmation.  So in the absence of a definitive read one way or the other I guess all that leaves  is for me to call Thursday uncertain.

Single Stock Trader

VZ redeemed itself on April 1st with a nice bullish piercing pattern.  So although we now have three descending candles, this one looks ready to move higher.

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