Thursday, May 14, 2015

Thursday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Thursday uncertain.
  • ES pivot 2097.50.  Holding below is bearish.
  • Friday bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ not a swing trade buy.

I called Wednesday higher (though I apparently forgot to hit "publish" late Tuesday night so it didn't go out until noon on Wednesday) but no matter, the Dow had a tiny range day and finished well inside the noise band with just an eight point loss.  So let's move on to the day before op-ex to figure out what if anything any of this means.

The technicals

The Dow:  After several large excursions both down and up the previous two days, the Dow did next to nothing on Wednesday in something that could be construed as a symmetrical triangle - or maybe not.  I don't know if it's op-ex week jitters or what but there are very few technical clues at least that I can see in this chart tonight.  So no call here.

The VIX:  Last night I wrote that the VIX "looks bearish to me."  And while it was in fact down, it was only 0.72% and on a green spinning top at that.  We also just barely squeaked out a bullish stochastic crossover so I guess this one looks higher for Thursday but it's far from crystal clear.

Market index futures: Tonight, all three futures are mixed at 12:10 AM EDT with ES up  0.04%.  ES had the day traders pulling their hair out Wednesday, going basically nowhere by the close.  With two opposing dojis now ( a hammer followed by an inverted hammer), where this goes next is anyone's guess.  The overnight isn't helping either, basically going nowhere at the moment.

ES daily pivot: Tonight the ES daily pivot rises from 2091.75  to 2097.50.  That gain plus a lackluster ES in the overnight now places it below the new pivot so this indicator turns bearish.

Dollar index:  Last night of the dollar I wrote that it "looks like lower again on Wednesday".  And that's what happened, down a big 1.02% to form a bearish stochastic crossover even as RSI is oversold.  With the lower BB yet to be hit, this sort of bearish momentum is not to be toyed with.  I'd not go long the dollar here.

Euro:  And so also last night I wrote of the euro that "this chart looks higher Wednesday."  And that's also just what happened as the euro popped right back to its resistance at 1.1365 for a bullish setup on a descending RTC exit.  Indicators continue to rise  but it's not clear the euro can clear this resistance.

Transportation:  And finally last night I wrote that  it "all adds up to continued lower" and that's just where the trans went on Wednesday, down a big 1.04% to close right on support and just short of the lower BB.  That move forced the indicators way down, now just off oversold.  So a reversal is looking likely based on S/R lines but not on the candles just yet.


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      3      8       7           0       0.273      1
May        4      2       1           2       0.750    440

     And the winner is...

The market has been pretty conflicted all week long swinging one way and then the other with little to show for it in the end and the technicals reflect that.  Against this backdrop there's little I can do so I will just have to call Thursday uncertain.

Single Stock Trader

Last night I noted a possible reversal in VZ and it did in fact rise on Wednesday, though only by an anemic 11 cents and with a spinning top at that.  That flattened out the indicators too so once again, I'm not on board.  I'm still waiting for my preferred setup.

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