Friday lower

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

• Friday lower.
• ES pivot 2042.58  Holding below is bearish.
• Next week bias uncertain technically.
• Monthly outlook: bias lower.
• Single stock trader: VZ still not a swing trade buy.

Recap

It was a just flat out ugly day on Wall Street with the SPX gapping right down through its 200 day MA.  ES never even threatened its pivot in the early morning hours and that was that - we just continued lower the rest of the day.  When will this selling end? Let's check the charts and see if we can figure out Friday.

The technicals

The Dow:  Wow - the Dow took a tumble right out the gate Thursday morning then continue to drift lower most of the rest of the day until finally in true kick 'em when they're down fashion they knocked it lower again into the close to finish at session lows. Amazingly this tall red marubozu traded mostly below the lower BB and although the indicators are now oversold they're not vastly so. And this candle also exited the last rising RTC for a bearish trigger.  On top of that on Thursday we gave up support at 17,189 and then kept right on going to break support that goes all the way back to last December at 17,533 leaving the Dow at its low of the year.  I'd like to say the selling is overdone here but I'm afraid I don't see any bullish technical signs on this chart at all.

The VIX:  And speaking of wow, take a look at the VIX which on Thursday rocketed up just over 25% on a giant gap up moonshot marubozu that traded nearly entirely above its upper BB and very nearly hit 20 in the process.  Up 25% - one one day?  Are you freakin' kidding me?  That was just short of the highs hit last month when the world was about to collapse because of oh what was it, oh yes Greece I believe. When Mr. Market takes giant legs up like this it tends to stick around awhile as opposed to the usual behavior of the VIX which is to fall back within a day or two of hitting its upper BB. So despite highly overbought indicators we can't quite call this one lower yet specially since the stochastic has not even begun to curve around in preparation for a bearish crossover.

Market index futures: Tonight, all three futures are lower at 1:31 AM EDT with ES down a significant 0.52%.  Wednesday it looked like ES might be headed higher after bouncing off its 200-day MA but on Thursday instead it just totally fell out of bed and crashed right through the same MA and its lower BB to close at 2028. That left the indicators oversold but the stochastic still has not yet begun to curve around for a bullish crossover.  With its worst day since uh, the late Middle Ages ES is looking just plain ugly tonight.  The only possible salvation at this point would be for a DCB or a relief rally on Friday.

ES daily pivot: Tonight the ES daily pivot plunges from 2079.08 to 2042.58.  We remain way below the new pivot so this indicators just continues bearish.

Dollar index:  The dollar on Thursday also took a dump with a gap-down red spinning top that closed right on its lower BB which continues to fall away.  It also traded outside its last rising RTC for a bearish trigger.  The indicators are once again oversold, however the stochastic in a worrisome sign, just completed a bearish crossover from a low level which means that despite vague reversal warnings from the candle I can't call this chart higher yet and in fact it looks like there's still more downside to come.

Euro:  Last night I thought the euro was going higher on Thursday and it turns out that's just what happened as it continued on to close at 1.120.  That was also a bullish trigger on a descending RTC exit and it also formed a bullish stochastic crossover from a high level.  Those are generally good for another day or two of higher prices. We also cleared resistance at 1.1169 so at this point I would have to think that the euro goes higher again on Friday.

Transportation:  And finally, on Thursday the trans underperformed the Dow with a giant red marubozu that dropped two and a half percent to fall out of a short rising RTC, stopping only on its lower BB which coincidentally was also right when the bell rang.  This sent the indicators oversold but also completed a bearish stochastic crossover.  Until we see a reversal candle or at least the stochastic curving around for a bullish crossover I can't call this chart higher.

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     6      1       1           2       0.889    666
     And the winner is...

OK, no fooling around tonight.  I was looking for some signs that Thursday's selling might be overdone or that a DCB might kick in but there's just no way.  These charts have been beaten soundly with the ugly stick.  I wish it was different but as far as I can tell, on Friday Mr. Market is going down.  That's all, she wrote.  That's enough.  See you again Sunday night!

Single Stock Trader

Last night I decided to hold off on calling Verizon a buy based on it's spinning top candle and on Thursday I was glad I did because it got hit hard along with the rest of the market.  That was enough to drive the indicators oversold but the stochastic continues to fall and although we're now near a potential buy level I'm still not on board.

Thursday depends on ES pivot

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

• Thursday higher only if ES breaks above its pivot, else lower.
• ES pivot 2079.08.  Holding below is bearish.
• Friday bias higher technically.
• Monthly outlook: bias lower.
• Single stock trader: VZ still not a swing trade buy.

Recap

Last night all the charts suddenly started looking bearish which was why I was pretty confident that it was a good time to call Wednesday lower and indeed that's just what happened despite a mid-afternoon rally centered about the release of the Fed minutes - but that's neither here nor there . It was a big move and changes the picture considerably so let's move on to Thursday  and see what's going to happen next .

The technicals

The Dow:  On Wednesday the Dow took quite a tumble falling right out of its rising RTC on a tall red candle that just touched its lower BB before  recovering a bit and driving the indicators oversold.  We also broke support at 17,363 and formed a bearish stochastic crossover.  So technically there's nothing bullish  about this chart tonight - again

The VIX:  Last night I wrote that "the VIX now looks higher on Wednesday".  And that was a great call because the VIX on Wednesday took a giant 10.6% pop right over its 200-day MA for a tall green spinning top that sent the indicators highly overbought and formed a new bullish stochastic crossover.  But this now has the look of an evening star so I'm cautious about calling the VIX any higher from here.  The general tendency recently of the VIX is to go lower after a 200 day MA breakout

Market index futures: Tonight, all three futures are higher at 1:17 AM EDT with ES up 0.08%.  On Wednesday ES had its worst day in a month with a tall red candle that drove it right out of its rising RTC for a bearish set up.  We just touched the lower BB and also very nearly touched the 200 day MA which is now fairly close at 2064. That also confirmed the bearish stochastic crossover and sent the indicators continuing lower.  However it looks like the overnight is trying to rally a bit and indeed after such a big one day loss we may be due for a DCB or some sort of relief rally.  I note too that ES successfully tested support around 2072 on Wednesday, so that's a good sign.

ES daily pivot: Tonight the ES daily pivot dives from 2096.00 to 2079.08.  Even after all that, ES is still below its new pivot so this indicator continues bearish.

Dollar index:  Last night I figured the dollar was going higher again because of the tall green marubozu ignoring the fact that it was also a dark cloud cover because it was green.  On Wednesday though it all came crashing back down with a big 0.72% loss on a tall red inverted hammer that curved the stochastic around in preparation for a bearish crossover and sent RSI lower despite having only just gotten off oversold.  That's also a bearish exit on a rising RTC so there's really nothing bullish looking about this chart tonight

Euro:  On Wednesday the euro also fooled me after four down days in a row.   With no reversal candle in sight I figured it was due to move lower again.  But much to my surprise it instead jumped higher with a tall green marubozu to close at 1.115 and that was enough to pop it right out if its descending RTC for a bullish setup and form a bullish stochastic crossover from a high level.  Those are generally good for another day or two of higher prices and with the overnight going a bit higher yet again I think it's fair to say that on Thursday the euro will close higher

Transportation:  And finally, last night I wrote that "this pattern definitely doesn't look bullish anymore."  And indeed it wasn't as on Wednesday the trans confirmed Tuesday's spinning top with a definitive move lower that curved the stochastic around in preparation for a bearish crossover. While we remain in a broad rising RTC this pattern definitely looks to have topped.  I think we're going lower again on Thursday

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     6      1       1           2       0.889    666

     And the winner is...

I really think Wednesday's losses were a bit overdone and the market is due for some retracing.  We're also near some good support levels on various charts and have gotten some good reversal signs too (BB hits).  But all that junk requires confirmation so the best I can do, given the proximity of ES to its pivot, is a conditional call.  If ES manages to break above its pivot by mid-morning Thursday, we'll close higher.  If on the other hand it remains below the pivot, we'll close lower.

Single Stock Trader

On a decidedly ugly day in the market VZ was actually one of the better performers dropping just two cents on a tall spindly  spinning top that sent the indicators lower from overbought and continued a completed bearish stochastic crossover. Overall though this is only a reversal warning and it looks like there might still be more selling in store. In any case this is still not my preferred swing buy opportunity so that leaves us exactly where we've been - just waiting.

Wednesday lower

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

• Wednesday lower.
• ES pivot 2096.00.  Holding below is bearish.
• Rest of week bias higher technically.
• Monthly outlook: bias lower.
• Single stock trader: VZ still not a swing trade buy.

Recap

Last night I was conflicted about whether to call the market higher because of all the positive-looking charts, or just uncertain because, "I note that the Dow has been putting in lower highs since May now and Monday's high lies right along that descending line."  Well the latter view turned out to be a better interpretation and that now raises some concerns.  So let's continue to Wednesday as op-ex week rolls along.

The technicals

The Dow:  What stands out from Tuesday's results is the continuation of a trend back to May of the Dow continuing to make lower highs.  While the Dow remains in a short rising RTC and the indicators remain just short of overbought, Tuesday's red spinning top is definitely concerning.  And I'm giving it better than even odds of going lower again on Wednesday.

The VIX:  his chart definitely surprise me by gaining 5.91% on a bullish harami on Tuesday after really looking like it was going lower.  The net result was a trade outside the descending RTC for a bullish setup and a stochastic that's curving around for a bullish crossover.  So the VIX now looks higher on Wednesday.

Market index futures: Tonight, all three futures are lower at 12:25 AM EDT with ES down 0.12%.  On Tuesday, ES found resistance at 2100 just too much for it as it fell back to 2094 on a red spinning top in a move that curved the stochastic around in preparation of a bearish crossover and peaked the indicators short of overbought.  That's all a good sign of lower to come, and despite a rally attempt earlier this evening ES is now drifting back down.

ES daily pivot: Tonight the ES daily pivot rises again from 2091.50 to 2096.00. That now puts ES back below its new pivot so this indicator turns bearish.

Dollar index:  At least I got this much right when last night I wrote "this chart looks bullish again."  And the dollar indeed gained another 0.26% on Tuesday rejecting the spinning top in a big way.  Indicators are only just barely off oversold and the bullish stochastic crossover is nicely completed so this one just looks higher again on Wednesday.

Euro:  And last night I also wrote "I don't think the selling is done here yet."  Good thinking too because the euro just fell out of bed Tuesday right back down to 1.1023.  That was enough to drop it right out of a two-week rising RTC for a bearish setup.  And with indicators only just now off overbought and a bearish stochastic crossover in full effect, I think there's still room to run lower.

Transportation:  It's also concerning that despite an absence of bearish signs, on Tuesday the trans lost 0.21% on a dark cloud cover as a spinning top.  Indicators are not quite yet to overbought but this pattern definitely doesn't look bullish anymore.

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     5      1       1           2       0.875    503

     And the winner is...

What a difference a day makes.  Tonight all the charts are suddenly looking bearish and with continued failure at recent resistance indicating trouble finding more buyers, I'm going to have to go with that and call Wednesday lower.

Single Stock Trader

Last night I didn't want to bless VZ despite a bullish engulfing pattern and indeed it lost ground on Tuesday, this time on a bearish dark cloud cover as a spinning top.  With indicators still overbought and a completed bearish stochastic crossover there's just no buying this one.

Tuesday higher

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

• Tuesday higher....
• ES pivot 2091.50.  Holding above is bullish.
• Rest of week bias higher technically.
• Monthly outlook: bias lower.
• Single stock trader: VZ still not a swing trade buy.

Recap

All the signs were looking positive last night but I guess I just got spooked by some falling oil and lack of enthusiasm from ES, all of which made me call Monday uncertain.  Turns out the Dow rose yet again, making it now four in a row and even doing a bit better than Friday..  Ah but where does that leave Tuesday?  Off to the charts we go in search of clues.

The technicals

The Dow:  Well the Dow did exhibit some indecision on Monday as it plunged right out the gate but after the first five minutes it was all uphill into the close.  That keeps us in a nice rising RTC with all indicators rising but not yet overbought.  On the other hand, we now have a tall hanging man so that's at least a reversal warning.

The VIX:  Whoa - this was really odd.  On Monday the VIX rose 1.48%.  It's unusual enough for it to move in correlation with the market but it did it on a tall red marubozu dark cloud cover.  And that was enough to keep it inside its descending RTC and keep the indicators falling towards oversold.  So this chart still looks bearish.  That was definitely a strange one.

Market index futures: Tonight, all three futures are again mixed at 12:45 AM EDT with ES up just 0.02% and YM dead even.  After a rocky open, ES ended up doing quite well on Monday, powering right back to resistance at 2100.  That leaves a new rising RTC in effect and indicators also continue to rise but are not yet overbought.  If ES can clear resistance here, it looks like smooth sailing all the way to the upper BB at 2112.  The currently developing overnight candle isn't looking so hot though, as an inverted hammer.

ES daily pivot: Tonight the ES daily pivot rises again from 2084.58 to 2091.50. ES remains above its new pivot so this indicator continues bullish

Dollar index:  Last night I wrote that "this chart looks all-around bullish".  Well it wasn't a raging bull perhaps but it did gain another 0.29% Monday to exit its descending RTC for a bullish setup.  That also caused the indicators to clearly bottom at oversold and gave us a new bullish stochastic crossover so this chart looks bullish again.

Euro:  And last night I also wrote that "it's looking like the euro closes lower again on Monday."  And that was looking good with the euro falling back to 1.1085 to make it three down in a row and a new descending RTC.  Even at that indicators remain overbought and we have a new completed stochastic crossover so I don't think the selling is done here yet.  The overnight is continuing lower, supporting that idea.

Transportation:  And in quite a bullish sign, on Monday the trans outperformed the Dow with a 0.73% gain that exited the descending RTC for a bullish trigger and sent the indicators continuing higher on their way towards overbought.  So there's also nothing bearish on this chart for Tuesday.

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     5      1       1           2       0.875    503

     And the winner is...

Well things are looking generally positive tonight so I'm going to go ahead and call Tuesday higher, though more because of an absence of bearish signs than any strong conviction in the current mini-rally.  I note that the Dow has been putting in lower highs since May now and Monday's high lies right along that descending line.  I guess we'll see.

Single Stock Trader

VZ was one of the weaker members of the Dow on Monday but nonetheless managed to pull off a green bullish piercing pattern.  However, the indicators remain overbought, we have a new bearish stochastic crossover, and a bearish trigger on a rising RTC exit so I'm afraid all that trumps the candle.  Still no buy here.

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.

Recap

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.

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     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.