Tuesday, September 15, 2015

Tuesday uncertain

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Tuesday uncertain....
  • ES pivot 1958.25.  Holding below is bearish.
  • Rest of week bias lower technically.
  • Monthly outlook: bias higher.
  • Single stock trader: VZ a swing trade buy.

I took a chance last night by calling the market higher on Monday and despite an early spike higher was finally proven wrong as the Dow finished losing 62 points. The markets continue their nervous progression towards Fed day so we look to the charts for some indication of Tuesday as this important op-ex week rolls on.
The technicals

The Dow

On Monday the Dow put in a small dark cloud cover to end a short winning streak at two. The area around 16,475 is proving to be just too tough for it right now. And yet it continues to put in higher lows day after day. The indicators also continue to be mixed as is the overall picture so it's difficult to tell what to make of this particular pattern tonight.

I mentioned something the other night about what looks like a symmetrical triangle in ES. But looking at the chart of the Dow it's looking more like an ascending triangle and if that's the case one would expect a break when it comes to be higher. The pattern is nearly complete and oddly enough should be finished right around the time of the set announcement this week.

The VIX:  After two days of declines, on Monday the VIX gained 4.5% but did it on a small spinning top in harami position. That was enough to send the indicators starting to move slightly higher from oversold . however the overall trend of the ex continues to remain lower.

Market index futures: Tonight, all three futures are higher at 12:57 AM EDT with ES up 0.10%. This will be our last night looking at the U contract of ES. On Monday ES put in a fat spinning top sitting in dark cloud cover position The indicators remain confused with RSI falling but momentum rising. And the new overnight seems to be trying to stage something of a small rally. So overall this chart is somewhat less than totally clear.
ES daily pivot: Tonight the ES daily pivot falls  from 1953.33 to 1958.25. That's enough to put ES back below its new pivot so this indicator now turns bearish.

Dollar index:  Last night I wasn't ready to call the dollar higher on Monday but it put in a tiny 0.03% advance anyway with a small red spinning top sitting right at the bottom of Friday's big decline. Indicators continue falling though but have not yet reached oversold. So there's only a weak reversal warning here and once again I can't call the Dollar higher just yet.

Euro:  Monday's chart of the euro is a bit more clear. It gave us a nice red spinning top sitting right at the top of Friday's big punch through its 200-day MA to close at 1.3333. That left the indicators highly overbought and the stochastic just in position for a bearish crossover. The new overnight is putting in a small spinning top at the bottom of Mondays candle so this one looks like it has a fair chance of moving lower on Tuesday.

Transportation:  The trans continue to be unable to break resistance around 8060 and on Monday lost 0.45% on a red bearish engulfing pattern. The indicators have now begun falling after just reaching overbought. However the trans remain in a rising RTC. Still the current pattern suggests lower to come.


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    10      2       3           2       0.857   2314

September  5      2       2           0       0.714   1228

     And the winner is...

The nervous congestion in the markets continued on Monday as everybody awaits the big decision from the Fed later this week. Therefore I don't think there's much point in my trying to call the market one way or the other, so I will have to content myself with simply calling Tuesday uncertain.
Single Stock Trader

Verizon continues to confound. After Friday's bullish confirmation of last Thursday's spinning top, on Monday it instead lost $0.07 on a dark cloud cover. None of which means much of anything since it is subject to the same confusion the rest of the market and will give us no clarity until after the Fed decision. In the meantime it is still not a swing trade buy.

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