Actionable ideas for the busy trader delivered daily right up front
- Friday lower.
- ES pivot 2109.08. Holding below is bearish.
- Next week bias uncertain technically.
- Monthly outlook: bias lower.
- Single stock trader: VZ still a swing trade hold.
Last night I thought we could get a doji on Thursday and that's just what happened, with a nice inverted hammer sitting right at the top of Wednesday' big pop. Let's move on to the end of the week and see where Friday is going.
The Dow: On Thursday the Dow gained 39 points as indicators continued rising off oversold. The inverted hammer is a bearish sign and Friday being Friday, it's possible traders may be wanting to bank their profits rather than remaining long into a weekend beset with geopolitical risk. So I'm not going long at this juncture.
The VIX: Last night I wrote that "nothing bullish to be seen on this chart." And indeed there wasn't with the VIX down another 2.8% on a gap-down spinning top. Indicators continue falling towards oversold (but not there yet). We now have 2/3 of a morning star but that requires confirmation. So the best I can say is that the VIX may be moving higher within a few days.
Market index futures: Tonight, all three futures are lower at 12:13 AM EDT with ES down 0.18%. On Thursday ES put in a small spinning top sitting n the high of Wednesday's advance. This is a typical topping sign and with a non-trivial retreat in the overnight, I'm not optimistic for Friday.
ES daily pivot: Tonight the ES daily pivot rises again from 2098.33 to 2109.08. And that move plus a sagging ES in the overnight is enough to place it below its new pivot so this indicator turns bearish again.
Dollar index: Last night I wrote that "I wouldn't go short the dollar right now". Good thing too because the dollar rose 0.34% on Thursday, though on a funny long red marubozu. So is this a morning star or not? It looks like the dollar is having trouble getting into gear right now.
Euro: Last night I wrote that "I'm still not on board the euro." Just as well too because the euro looks topped out, falling back to 1.1263. That's three reversal candles in a row now: star, inverted hammer hanging man. With overbought indicators, the other shoe has to be dropping pretty soon. And the overnight is guiding lower so I'd say we're looking at another lower close on Friday.
Transportation: Last night I didn't want to believe the bullish confirmation of Tuesday's hammer in the trans and it's too bad because they gained a solid 1.05% on Thursday with a tall green marubozu. That also formed a sharp bullish stochastic crossover with indicators still a ways from overbought. So with no resistance til 8505 there are now no bearish signs on this chart.
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 3 1 2 3 0.857 327
And the winner is...
After two reasonably good days the market is feeling toppy tonight with a number of reversal candles on the charts. It doesn't help that it's a Friday coming up. So I'm just going to go ahead and call Friday lower. I'll be happy as always to be proven wrong. That's all she wrote. See you again Sunday night!
Single Stock Trader
Last night I called VZ a hold and it was a good call as VZ gained some more on Thursday. It is now in fact in a new rising RTC and still oversold. With a new bullish stochastic crossover I'd say there seems to be more upside potential than downside risk here.