Friday depends on ES pivot

The Hoot 
Actionable ideas for the busy trader delivered daily right up front

• Friday higher only if ES breaks above its pivot, else lower.
• ES pivot 2082.92.  Holding below is bearish.
• Next week  bias uncertain technically.
• Monthly outlook: bias lower.
• Single stock trader: VZ not a swing trade buy.

Recap

Yup, as I was afraid, despite a spinning top reversal sign last night the Dow continued lower by triple digits on Thursday.  Is this market ever going to go higher?  We scour the charts for clues to Friday.

The technicals

The Dow:  With another 121 point loss on Thursday that now makes six down in a row, the longest losing streak of the year so far.  And this one broke support at 17,454 to near it slower BB intraday.  And though the indicators finally hit oversold the stochastic continues falling with no sign of a bullish crossover.  I think we're now getting close to a reversal but I dont' think it will happen Friday.  Though Friday might be a doji day.

The VIX:  Last night I wrote that the VIX "looks like it's ready for a move higher from here."  And damned if that isn't exactly what happened as the VIX confirmed Wednesday's hammer and  jumped 10% on Thursday, its biggest gain in a month.  With a bullish stochastic crossover now in full effect and indicators only just off oversold I don't think the VIX is done rising yet.

Market index futures: Tonight all three futures are higher at 12:55 AM EDT with ES up 0.11%.  On Thursday, ES lost ground on a basically bearish engulfing candle that drove the indicators oversold as the stochastic continues its descent from a bearish crossover.  We broke support at 2082, and with next next support not til 2067 (which is also the lower BB) I think there's still room to run lower here.

ES daily pivot: Tonight the ES daily pivot falls again from 2094.33 to 2082.92. That still leaves ES below its new pivot but right now by barely a point, so this indicator is now only weakly bearish.

Dollar index:  Last night I wrote that "this chart now looks lower to me."  And indeed it was, down 0.13% on Thursday with a classic dark cloud cover.  With the indicators still overbought and the stochastic and the brink of a bearish crossover it looks like this one goes lower again on Friday.

Euro:  And last night I also wrote that "the next move looks likely higher." on the euro.  And sure enough on Thursday the euro confirmed Wednesday's doji with a bounce back to 1.0926 on a green spinning top that still leaves the indicators just oversold but all moving higher including the stochastic.  The new overnight continues higher still and as a bonus that's exiting the descending RTC for a bullish setup so this chart still looks higher on Friday.


Transportation:  Ah yes, in a move Stevie Wonder saw coming last night I wrote that "this one looks ready to move lower."  And down they went, off 0.83% in a move that confirmed Wednesday's gravestone doji, peaked the indicators at overbought, and completed the bearish stochastic crossover.  That all leaves this chart looking just plain ugly.  There's more downside left here.

Accuracy: 

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     3      1       0           0       0.750    261

     And the winner is...

The market has let off a lot of steam over the past few days and a bunch of charts now look like they're near turning points.  But they're not quite there yet.  Actually I think Friday could be a bottoming day, perhaps a hammer candle.  Caution would dictate calling it "uncertain" but because of the proximity of ES to its new pivot I think this would be another opportunity to make a conditional calling ES can break above its new pivot by mid-morning Friday, we'll close higher.  If not, we close lower.  That's all she wrote.  See you again Sunday night!

Single Stock Trader

On Thursday VZ put in a tall skinny hammer, almost dragonfly doji but with indicators still overbought and a completed bearish stochastic crossover in effect I don't think that's going to be enough to call this one a swing buy yet.

Thursday lower

The Hoot 
Actionable ideas for the busy trader delivered daily right up front

• Thursday lower.
• ES pivot 2094.33.  Holding below is bearish.
• Friday bias uncertain technically.
• Monthly outlook: bias higher.
• Single stock trader: VZ not a swing trade buy.

Recap

My conditional call last night for Wednesday was close but no cigar as the Dow finished off all of 10 points, dragged down entirely by Disney.  I will point out that both the SPX and Nasdaq did finish higher.  The market is a game of odds and not every bet is a winner.  So with that deep philosophy out of the way, let's trudge on to Thursday and see where the charts are pointing.

The technicals

The Dow:  Well purely on technicals, on Wednesday the Dow put in a long-legged spinning top accompanied by a  bearish stochastic crossover to remain in a steep descending RTC.  And that mostly looks continued bearish.

The VIX:  On Wednesday the VIX dropped nearly 4% but on a green hammer with oversold indicators and a fresh bullish stochastic crossover. It looks like it's ready for a move higher from here.

Market index futures: Tonight, all three futures are lower at 12:19 AM EDT with ES down 0.08 %.  On Wednesday ES managed to put in a bullish engulfing pattern but on an inverted hammer.  The developing candle is moving the indicators lower off overbought and the stochastic is clearly falling so with a continuing failure to put in new higher daily highs, this chart looks lower again on Thursday.

ES daily pivot: Tonight the ES daily pivot rises again from 2086.92 to 2094.33. And that was enough to put ES back below its new pivot so this indicators is now bearish.

Dollar index:  The dollar continued bouncing around on Wednesday with a small gain but on an inverted hammer that nearly touched the upper BB.  Indicators are now overbought and the stochastic is in position for a bearish crossover so this chart now looks lower to me.

Euro:  The euro has also been getting jerked around lately and finished Wednesday with a perfect doji star at 1.0901.  The overnight seems to be confirming that and with indicators now oversold and the stochastic primed for a bullish crossover I'd say the next move looks likely higher.

Transportation:  The trans broke out of week-long consolidation on Wednesday but on a tall inverted hammer that touched their upper BB.  Indicators are now highly overbought and this move gave us a new bearish stochastic crossover so this one looks ready to move lower.

Accuracy: 

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     2      1       0           0       0.667    140

     And the winner is...

I'm afraid I just don't see any bullish signs on the charts tonight so the only logical call is for Thursday lower.

Single Stock Trader

VZ only lost a few cents on Wednesday but the trend is now clearly lower with a freshly completed bearish stochastic crossover.  Still no buy here.

Wednesday depends on ES pivot

The Hoot 
Actionable ideas for the busy trader delivered daily right up front

• Wednesday higher only if ES breaks above its pivot, else lower.
• ES pivot 2086.92.  Holding below is bearish.
• Rest of  week bias uncertain technically.
• Monthly outlook: bias higher.
• Single stock trader: VZ not a swing trade buy.

Recap

Ja, ja, the market was looking saggy last night and sure enough down it went some more on Tuesday.  With Greece and China apparently now out of the way, the technicals seem to be working again, so let's capitalize on that and see whither Wednesday.

The technicals

The Dow:  On Tuesday the Dow gave up another 48 points on a lopsided spinning top to give us three black crows.    This was the payoff on Monday's bearish RTC trigger.  It also confirmed a bearish stochastic crossover and with the indicators still a long ways from oversold we're now in full-blown bearish mode here.

The VIX:  Ah, El Vixmo.  Last night I wrote that "there's more upside left here."  And sure enough on Tuesday the VIX rose another 3.5%.  This gave us a bullish trigger on a descending RTC exit as well as a bullish stochastic crossover.  So there's nothing but bullish signs on this chart right now.

Market index futures: Tonight, all three futures are higher at 12:25 AM EDT with ES up  0.16%.  On Tuesday ES just kept on falling to yield three black crows, a completed bearish stochastic crossover and a steep new descending RTC.  No bullish reversal signs on this chart, fer sure.

ES daily pivot: Tonight the ES daily pivot falls again from 2091.17 to 2086.92. That still leaves ES under the new pivot but only by a fraction of a point, close enough in fact that it's a wash at this point.

Dollar index:  Whoa!  The dollar was doing exactly nothing until 1:25 PM EDT when it suddenly took off the end with a 0.42% gain and its highest close since July 20th.  This tall green marubozu was the mother of all bullish engulfing patterns.  However it was also enough to send the stochastic around in preparation for a bearish crossover.  And since we're now just short of month-long resistance I'd say further upside is limited from here.  Wednesday might be a doji day.

Euro:  Last night I wrote that it "[l]ooks like there's at least one more day lower in store before the reversal."  And in fact the euro did fall again, back to 1.0897 easily giving up support at 1.0915 in the process.  That now leaves it oversold and with a stochastic curving around for a bullish crossover.  The overnight is continuing lower though so the best I can say is that a move higher is coming before the end of the week but it may not be Wednesday.

Transportation:  In what would ordinarily seem to be a bit of bullish divergence, the trans rose 0.12% on a day the rest of the market was lower.  However, Tuesday's candle was stopped by resistance at5 8427 just like the last four days.  And with indicators now highly overbought along with a new bearish stochastic crossover it looks to me like the trans are headed lower on Wednesday.

Accuracy: 

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     2      0       0           0       1.000    140

     And the winner is...

Tonight the charts overall are still looking pretty bearish.  Ordinarily I'd just go ahead and call Wednesday lower but I always hate to go against the futures,  On the other hand the futures alone aren't enough to make a bullish call.  But the proximity of ES to its pivot makes this a good opportunity for a conditional call: if ES can break above its new pivot and stay there by mid-morning Wednesday, we'll close higher.  But if it remains below or falls further, we close lower.

Single Stock Trader

I guess third time's the charm.  After three reversal candles in a row, VZ finally gave up the ghost on Tuesday, down 0.64%.  And that stopped right on the edge of its latest rising RTC.  We'll call it a bearish setup.  And the stochastic is perched on the cusp of a bearish crossover (the two lines are only 0.01 apart).  So it looks like the selling still has some more to go.

Tuesday lower

The Hoot 
Actionable ideas for the busy trader delivered daily right up front

• Tuesday lower.
• ES pivot 2091.17.  Holding below is bearish.
• Rest of  week bias uncertain technically.
• Monthly outlook: bias higher.
• Single stock trader: VZ not a swing trade buy.

Recap

As expected, Monday moved lower to start off August in pretty typical fashion.  Not much to see here so we turn our attention right towards Tuesday.

The technicals

The Dow:  Three strikes and yer out.  After failing to retake the 200 day MA three days running, the Dow finally gave up the ghost on Monday and fell out of its rising RTC for a bearish setup on a red hammerish thing and a stochastic ever so close to a bearish crossover.  Net net, I don't think the selling's over.

The VIX:  Last night I wrote that "I'd say the VIX is going higher Any Day Now".  And we didn't have long to wait as the VIX rose 3.63% on Monday to complete a bullish morning star.  It also bent the stochastic around nicely to just short of a bullish crossover.  Oh, and despite a red spinning top it was also an exit of the descending RTC for a bullish crossover.  So all in all I'd again have to say there's more upside left here.

Market index futures: Tonight, all three futures are lower at 1:13 AM EDT with ES down  0.07% .  Last night I wrote that "I'd be cautious about going long at this point".  Good thing too because ES fell right back to 2091 on Monday on a tall lopsided red spinning top.  The overnight is continuing lower thus forming a bearish stochastic crossover meaning that there's still nothing bullish about this chart.

ES daily pivot: Tonight the ES daily pivot falls again from 2101.00 to 2091.17.  Tonight ES remains below its new pivot, though not by much.  But that still leaves this indicator bearish - for the time being.


Dollar index:  I refused to call the dollar last night but Monday's gap-up spinning top provided some clarity with a completed morning star.  Indicators are not yet overbought so all other things being equal it looks like there's more upside left here.

Euro:  Last night I wrote that "I'd guess the next move is lower on Monday".  Good guess too with the euro right back down to 1.0954.  It was a classic dark cloud cover and the overnight is continuing lower.  The stochastic has begun curving around for a bullish crossover but we're not there yet.  Looks like there's at least one more day lower in store before the reversal.

Transportation: The trans are now range-bound, unable to make any headway past 8428 but not dropping much lower either.  Indicators have now hit overbought and we have a spinning top but that requires confirmation.  So until I get it, I still can't call this chart.

Accuracy: 

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     1      0       0           0       1.000     92

     And the winner is...

Tonight looks a lot like last night with a bunch of bearish technical signs on the charts.  I also note that oil is back in positive correlation with the market and oil is tanking.  And Dr. Copper has been feeling ill for some time now.  Therefore it appears that the logical course of action is to call Tuesday lower again.

Single Stock Trader

Despite two reversal candles in a row, VZ did not move lower on Monday, instead posting a small gain on, yes, another reversal candle, this one a large red hammer.  Either way, nothing here suggests a good entry point so we let it pass once again.

Monday lower

The Hoot 
Actionable ideas for the busy trader delivered daily right up front

• Monday lower.
• ES pivot 2101.00.  Holding below is bearish.
• Rest of  week bias uncertain technically.
• Monthly outlook: bias higher.
• Single stock trader: VZ not a swing trade buy.

Recap

Last Friday held true to historical form as the Dow dropped 56 points after two nice days of gains.That comes at an interesting juncture as we begin a new month so let's head straight to the charts to see what they have to say about Monday.

The technicals

The Dow:  For the third day in a row the Dow was stymied by the 200 day MA last Friday.  After two failed attempts to break through, it just gave up and moved lower.  That confirmed Thursday's dragonfly doji and curved the stochastic around to prepare for a bearish crossover.  With a candle that closed right on the edge of a short rising RTC, this chart now looks more bearish than not for Monday.

The VIX:  After a confirmed bearish evening star last week that sent the VIX scurrying back below its 200 day MA, on Friday we got a small doji star that after four days of declines signals a reversal warning.  That's supported by a descending RTC exit for a bullish setup.   And the stochastic is curving around for a bullish crossover so I'd say the VIX is going higher Any Day Now.

Market index futures: Tonight, all three futures are lower at 12:18 AM EDT with ES dow 0.11%.  Last Friday ES gave use a second reversal warning in a row with a lopsided spinning top following a hanging man.  With indicators nearly overbought and the futures not doing much of anything in the overnight, I'd be cautious about going long at this point.

ES daily pivot: Tonight the ES daily pivot rises again from 2098.58 to 2101.00.   That now places ES back below its new pivot for the first time in several days so this indicator turns back to bearish.

Dollar index:  On Friday the dollar put in perhaps the tallest gravestone doji I've ever seen, battling its way back from early losses to finish essentially unchanged.  But with the indicators caught halfway between oversold and overbought, and what looks like a bearish evening star complete, once again this chart is too tough to call.

Euro:  And similarly, I couldnt' get a good read on the euro last Thursday night but looking at the crazy gravestone doji we got, who can blame me.  A big attempted move higher was soundly rejected and the indicators continue falling towards oversold so if anything I'd guess the next move is lower on Monday.

Transportation:  The trans also lost ground last Friday confirming Thursday's hanging man with a 0.33% fall that curved the stochastic around to prepare for a bearish crossover.  After bouncing off their upper BB on Wednesday the trans were unable to make any further headway.  That all looks like lower on Monday to me.

Accuracy: 

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

     And the winner is...

The first day of most months is historically bullish but August is not one of those.  And we now have the Dow failing to make any headway for three days in a row suggesting a decided absence of buyers at the 200 day MA as we enter the dog days of summer.  And tonight we've got a number of reversal signs on the charts.  Add it all up and I figure I'm going to call Monday lower.  I'll be happy to be proven wrong since I'm always net long.

Single Stock Trader

VZ was one of the Dow stocks moving higher on Friday but it did it on a tall inverted hammer, the second reversal warning in a row.  With indicators now near overbought, this is definitely not a buy point.