Actionable ideas for the busy trader delivered daily right up front
- Tuesday uncertain.
- ES pivot 2023.25. Holding above is bullish.
- Rest of week bias uncertain technically.
- Monthly outlook: bias higher.
- Single stock trader: VZ still not a swing trade buy.
It was another snoozer of a day on Wall St. with the Dow finishing a mere 15 points higher and not much of anything else going on. However, the charts are a bit more interesting so let's get right to them and see where Tuesday is going.
The Dow: On Monday the Dow put in an interesting candle because despite finishing nearly unchanged it gave us a classic hanging man, sent the indicators just barely off of overbought and left the stochastic with the completed bullish crossover I noted last night. Considering how little headway the Dow made on Monday this is a reversal candle worth paying attention to but one which requires confirmation nonetheless.
The VIX: Last night I said that the VIX might move lower again on Monday but that required confirmation. Well we got it with a 0.47% decline on a red bearish engulfing candle. The indicators remain oversold and the stochastic continues its bearish crossover from a low level so there is nothing bullish about this chart tonight.
Market index futures: Tonight, all three futures are lower at 1:02 AM EDT with ES down 0.05%. ES continues to put in smaller and smaller gains with Monday's move closing at 2027.50, just barely above Friday's close. It was also a classic hanging man and gave us a bearish stochastic crossover. Indicators are now just off of oversold and moving lower and the overnight is also guiding lower. So the general impression here is bearish for Tuesday.
ES daily pivot: Tonight the ES daily pivot rises from 2021.42 to 2023.25. That puts ES back above its new pivot so this indicator returns to bullish.
Dollar index: I wasn't ready to commit to last night's gap-up spinning top in the dollar and that's just as well because on Monday the dollar continued higher with a strong 0.39% gap-up advance on a second spinning top. This one was enough to bring the dollar off of oversold and send the stochastic on its way from oversold to overbought. So overall that leaves us in the same spot we were last night with a reversal warning which requires confirmation.
Euro: At least I was right last night when I said the euro didn't look like it's going to close higher on Monday because that's just what happened with it falling back down to 1.1336. The euro is in a new descending RTC, and the rising trend from the first half of this month is now clearly over. Indicators are all falling towards oversold but haven't gotten there yet. There is a hint of some support kicking in in the overnight this evening but the overall trend for the euro remains lower.
Transportation: Last night the trans looked pretty bearish to me but it turns out that on Monday they managed a 0.35% gain once again hitting support around 8040. Indicators continue falling toward oversold but have not reached there yet. Meanwhile the stochastic has started curving around for a bullish crossover but isn't there yet either. So with a hammer candle in place this chart looks like its primed to move higher on Tuesday but that requires confirmation.
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 7 4 8 1 0.667 1404
October 4 4 2 1 0.556 455
And the winner is...
Tonight the charts are looking toppy. However the VIX doesn't look ready to move higher and ES remains above its new pivot so it may be a bit premature to actually call a top right here. So all that's really left is for me to just call Tuesday uncertain.
Single Stock Trader
On Monday Verizon put in a second hanging man in a row but in the end went absolutely nowhere finishing unchanged. That still leaves all the indicators overbought and stochastic completely threaded out as well. So this chart still is not a swing trade buy.