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- Thursday uncertain.
- ES pivot 2114.50.. Holding below is bearish.
- Friday bias uncertain technically.
- Monthly outlook: bias lower.
- Single stock trader: VZ still not a swing trade buy.
We called Wednesday higher and I consider myself fortunate the Dow did just that given that ti spent most of the day moving lower after a big jump out the gate. But that was then and this is now so let's look at the charts as usual and think about Thursday.
The Dow: On Wednesday the Dow confirmed Tuesday's spinning top by moving higher - but did it with another reversal sign, a giant lopsided spinning top. Aside form that though we exited the descending RTC for a bullish setup, got a bullish stochastic crossover, and the indicators are still oversold. So the balance of all that is a bullish bias.
The VIX: Last night I spotted "a decent topping sign" in the VIX and down it went on Wednesday, off 4% on a gap-down doji star that still left the indicators overbought and formed a bearish stochastic crossover. That leaves plenty of room to run lower.
Market index futures: Tonight, all three futures are lower at 12:42 AM EDT with ES down 0.14%. Last night I noted a bullish stochastic crossover and that played out nicely on Wednesday sending ES higher for its best day in a week. Indicators are still a ways from overbought but the overnight seems to be having trouble advancing so I'm not sure about Thursday here.
ES daily pivot: Tonight the ES daily pivot rises again from 2105.58 to 2114.50. And that plus an overnight sag in ES is enough to put it back below its new pivot so this indicator now turns bearish.
Dollar index: Last night I wrote that there's "nothing bullish on this chart". Which was true, with a 0.38% drop on Thursday for two black crows. That was enough to send the indicators oversold but not enough for a bullish stochastic crossover so until I see a reversal sign, I'll have to go with more downside here.
Euro: And last night I also wrote that "this one looks like it's still got room to run". Which it did nicely on Wednesday, closing at 1.1260 to keep the uptrend alive but also sending the indicators very overbought, We're right on a resistance line but I'd be cautious here. This one could go either way on Thursday.
Transportation: Last night I wrote that "this one looks higher for Wednesday.". And that's where the trans went, up 1.22%. That was the payoff on the bullish RTC trigger. So with indicators still rising and no bearish signs in sight, I'd say there's still room for further gains.
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 0 1 1.000 94
And the winner is...
On the surface, things are looking fairly bullish tonight. I'm a bit concerned though that the indicators may have been a bit distorted by the early market advance and subsequent sell-off. I also note that the futures are trending lower in the overnight. But that alone isn't enough to make be turn bearish particularly in the absence of any other overtly negative signs. Therefore I will have to content myself to call Thursday uncertain.
Single Stock Trader
Last night I mentioned the need for caution here and while VZ did move higher on Wednesday, it ended lower following up a spinning top with an even bigger spinning top. This one actually pierced the 200 day MA and we remain oversold. But that leaves us where we were last night - show me the reversal.