Monday, August 17, 2015

Monday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Monday uncertain....
  • ES pivot 2084.58.  Holding above is bullish.
  • Rest of week bias higher technically.
  • Monthly outlook: bias lower.
  • Single stock trader: VZ not a swing trade buy.

So last Friday, the day I took off, not much happened.  The Dow rose 69 points on sub-average volume and an even smaller range than Thursday.  Will we see some action this week?  With another op-ex Friday coming up, let's see where the charts are guiding us.

The technicals

The Dow:  On Friday the Dow gave us a doji star sitting on top of Thursday's gains.  This was non-confirmed by Friday's further advances and that's a positive  sign as it marks a bullish trigger on a descending RTC exit.  So at this point I see nothing bearish on this chart.

The VIX:  Last I wrote about the VIX I said it looked "continued bearish".  And that continued not only on Thursday but Friday too as it lost another 4.89% for a bearish trigger on a rising RTC exit.  With a completed bearish stochastic crossover and descending indicators, I see nothing bullish on this chart.

Market index futures: Tonight, all three futures are mixed at 1:37 AM EDT with ES down 0.05 % but NQ up just a tick.  Relatively speaking, ES had the best day of any of the charts last Friday with a big bullish engulfing pattern that continued the indicators moving higher towards overbought..  There's no nearby resistance but the Sunday overnight is stalling out so that's raising the caution flag for Monday.

ES daily pivot: Tonight the ES daily pivot falls again from 2082.25 to 2084.58.  That still leaves us above the new pivot so this indicator continues bullish.

Dollar index:  Like the other charts, on Friday the dollar exited a descending RTC for a bullish setup.  It also curved the stochastic around to close in on  bullish crossover.  Add in a hit on the lower BB and oversold indicators and after many days of wishy-washy indecision, tonight this chart looks all-around bullish.

Euro:  Meanwhile the euro really looks like it has topped in the short term after  two red days with a close at 1.1124 on Friday.  That makes two red spinning top reversal warnings in a row, a bearish stochastic crossover and overbought indicators.  The overnight is continuing non-trivially lower so it's looking like the euro closes lower again on Monday.

Transportation:  Finally on Friday we got another reversal, this one with a bullish setup on a descending RTC exit for the trans, rising indicators, plus a bullish stochastic crossover and a confirmation of Thursday's spinning top.  So that all looks bullish for Monday.


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       8      6       3           4       0.706    552
July      10      1       5           4       0.938   1212
August     6      1       0           2       0.889    509

     And the winner is...

Tonight all the charts are looking pretty bullish.  The one exception is the news from the futures.  I'd expect some better pin action considering just how positive the charts look.  The problem may lie with oil, which lately has been quite positively correlated with the market, and tonight oil is continuing lower.  So with that kind of conflict at hand, I'm afraid I'm just going to have to call Monday uncertain as we kick off op-ex week.

Single Stock Trader

All I had to say about VZ last Thursday night was "Looking toppy.  Definitely not a swing buy here."  And that was correct, as VZ just continued lower on Friday.  And tonight, it's still not looking like a buy.

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