Friday, June 5, 2015

Friday depends on ES pivot

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Friday depends on ES pivot.
  • ES pivot 2114.50..  Holding below is bearish.
  • Next week bias uncertain technically.
  • Monthly outlook: bias lower.
  • Single stock trader: VZ now a swing trade buy.

Open letter to Greece: would you puh-leeze just declare bankruptcy, default on all your bills, and get this agony (nice Greek word) over with already?  Instead of draaaaging out the inevitable.  I hope you enjoyed your little snit today.  Tanking the US markets is not going to help you out.  You should have thought of this before going massively into debt.  Baah!

The technicals

The Dow:  Yes it was good I was cautious about calling the market higher Thursday despite positive-looking charts.  As it turns out, the futures knew what they were talking about when they were sagging a bit in the early morning hours.  And in the end those freakin' Greeks were good for a 171 point pounding for the Dow.  Like people are going to start brushing their teeth 1% less often?  Or use 1% less toilet paper?  No, this is insanity.  But oddly enough, the low of the Dow was right on the lower BB.  And RSI did not move any lower.  Recent big drops that touched the lower BB have results in big gains within two days.  This may be a buying opportunity.

The VIX:  And tellingly, the VIX gained 7.69%, less than you'd think on some ho-hum end-of-the-world news with a tall spindly spinning top that pierced its 200 day MA before retreating.  And RSI actually moved lower.  00 MA touches usually mark tops for the VIX and this time doesn't look any different.

Market index futures: Tonight, all three futures are lower  at 1:08 AM EDT with ES down 0.07%.  ES had a bad day Thursday, though not any worse than its already had twice before this month.  But this one drove it oversold.  There's still not a reversal candle but I think this selling's overdone and we're due for a bounce soon.

ES daily pivot: Tonight the ES daily pivot drops again from 2114.50  to 2102.25.  And even with that ES remains below its new pivot one again so this indicator continues bearish.

Dollar index:  The dollar has been in a steep descending RTC for a week now but finally manage a green candle on Thursday, even if the result was a 0.02% decline.  With indicators now finally oversold and a stochastic getting down to bullish crossover levels, I'd not be surprised to see a move higher on Friday.

Euro:  And on Thursday the euro put in a somewhat asymmetric spinning top/inverted hammer that peaked the indicators at overbought while remaining in a rising RTC.  The new overnight is  different story - down a big 0.34% so far to drop out of said rising RTC for a bearish setup and on the cusp of a bearish stochastic crossover.  After considerable reflection I think the euro's headed south on Friday.

Transportation:  On Thursday the trans dropped 0.86%, less than the Dow.  They even remained in their rising RTC and have still not hit overbought.  But this read candle is still technically damaging so I'm not going to call the trans higher 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        6      5       5           2       0.615    581
June       2      0       1           1       1.000     94

     And the winner is...

Just because the market is down big doesn't mean it can't go lower.  The SPX Hi-Lo indicator fell on Thursday but not quite far enough to serve as a reversal sign.  The candles are all bearish so the only reversal there would come in the form of a relief rally or DCB and I don't see either of those right now.  Still I'm quite concerned about he VIX touching its 200 day MA with a star as that's just about always associated with a move lower.  So I'm going to do another conditional call: if ES can claw back up over its new pivot by mid-morning Friday, we'll close higher, otherwise lower.  That's all she wrote.  See you again Sunday night!

Single Stock Trader

Huh - last night I wrote "
show me the reversal".  And on Thursday VZ showed me, after a 2% plunge (are you using the phone 2% less often?) fell off a cliff with a giant gap-down inverted hammer on huge volume leaving all the indicators very oversold.  That's it - I'm in.  VZ is now(finally)  a swing trade buy.

No comments:

Post a Comment

Due to some people who just won't honor my request not to post spam on my blog, I have had to re-enable comment moderation. Comments may take up to 24 hour to appear, depending on when they're made. Sorry about that.