Friday stock market forecast

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

• Friday higher.
• ES pivot 2087.17.  Holding below is bearish.
• Next week bias uncertain technically.
• Monthly outlook: bias higher.
• Single stock trader: VZ not a swing trade buy.

Recap

I'm sure glad I called Thursday uncertain last night because the Dow had its worst day since late September on Thursday, down 252 points. You can blame the price of oil, the ECB, rising interest rate fears, or the phase of the moon - whatever. In any case it was a bad day at Black Rock. At least we now finally have a decisive break from a two week-long stretch of indecision so let's take a look at the charts and see which way Friday is going.

The technicals

The Dow:  On Thursday the Dow took a giant 1.42% dump to go crashing right back through its 200-day MA. That's a bad sign and left the indicators oversold, and continued the current bearish stochastic crossover. Just looking at the daily chart here there's really nothing bullish to say about it tonight.

The VIX:  Similarly on Thursday the VIX jumped right up through its own 200 day MA with a giant 13.83% pop that just exactly rang the gong on its upper BB at 19.45 before falling back a bit to 18.11. That continued the indicators rising towards overbought though they're are not there yet. However, the upper BB touch is always a bearish sign for the VIX so it's not certain it will move higher again Friday.

Market index futures: Tonight, all three futures are higher at 12:56 AM EST with ES up 0.18%. And like everything else, on Thursday ES took its biggest drop since September 28th. This featured a test of its 200-day MA but that was successful as the MA provided support and it closed exactly on it at 2051.25. The indicators are now very close to oversold but not quite there yet. However with such a big drop in one day I would say a DCB or relief rally is not out of the question for Friday. And so far a non-trivial gain in the overnight Thursday seems to be supporting that idea.

ES daily pivot: Tonight the ES daily pivot falls again from 2087.17 to 2062.17. That still leaves ES below its new pivot so this indicator continues bearish.

US dollar daily ($USDUPX)

Dollar index:   On Thursday, the dollar got totally hammered courtesy of Super Mario with a with an unbelievable 2.39% death dive, one so big I couldn't even find anything comparable scrolling back five years. This monster gap-down red marubozu took the dollar oversold and sent all the indicators plunging lower. It is now very close to its 200-day MA and this chart if anything looks extremely overdone. I wouldn't be surprised to see some sort of a relief rally or at least a DCB off of this nonsense on Friday. Here - take a look at this chart.  The 200 MA is the dashed orange line.

Euro: And of course obviously on Thursday the euro took the opposite tack with an enormous green candle the likes of which I have literally never seen in the 10 years I've been doing this. It demolished its two month-long descending RTC to close back up to 1.0974, just short of its own 200 day MA. That sent all the indicators overbought in just one day and as evidence that the dollar decline may be overdone we see that the euro in the new Thursday overnight is declining significantly. So I would look for some measure of retracement here on Friday.

Transportation:  Like everything else on Thursday the trans had an absolutely miserable day dropping 1.8% to actually close below their lower BB at 7886. That leaves the indicators all oversold and the stochastic starting to curve around for a bullish crossover. But we need to see some sort of confirmation before calling this chart higher, especially now that we've got two large black crows on the books.

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    10      2       3           2       0.857   2314
September  7      4       8           1       0.667   1404
October    7      7       5           1       0.533    538
November   4      6       4           2       0.500   -350
December   1      0       2           0       1.000    168
 
     And the winner is...

We had several important 200 day MA's on Thursday with the Dow and SPX both falling below them the VIX rising above it, and ES finding support on it.  That's three negative to one positive, but I'll note that oil has found four month-long support on Thursday.  The SPX Hi-Lo indicator hit 31.4 on Thursday which is near what we'd like to see for a reversal (though not quite).  And the Dow and SPX both have support at their lower BB's very nearby.  So call me crazy but I'm going to go waaay out on a limb tonight and just call Friday higher.  I think we're due for a DCB at the least.  Friday could be a hammer day.  That's all she wrote.  See you again Sunday night!

Single Stock Trader

Last night officially declared the latest Verizon trade dead and it was a good thing too because it fell further on Thursday, all the way down to exactly touch its lower BB at 44.33. That completes a bearish stochastic crossover and gives us two red candles in a row. So it's still too early to think about getting back in again.

Thursday stock market forecast

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

• Thursday uncertain.
• ES pivot 2087.17.  Holding below is bearish.
• Friday  bias uncertain technically.
• Monthly outlook: bias higher.
• Single stock trader: VZ not a swing trade buy.

Recap

Well Wednesday afternoon Auntie Janet Spaketh and Mr. Market didn't Liketh it, dropping 159 in the Dow to end near session lows.  And to top it all off, it's another Nite Owl Lite Nite as I just plum ran out of time to put the blog together.  So it's just the conclusions, no discussions.  (And I apologize for neglecting to update the Wednesday headline call.  It really was "uncertain", as given on the Bottom Line.)

The technicals

Market index futures: Tonight, all three futures are higher at 12:15 AM EST with ES up 0.12%.

ES daily pivot: Tonight the ES daily pivot falls  from 2095.00 to 2087.17.  .That puts ES below its new pivot so this indicator turns bearish.

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    10      2       3           2       0.857   2314
September  7      4       8           1       0.667   1404
October    7      7       5           1       0.533    538
November   4      6       4           2       0.500   -350 December   1      0       1           0       1.000    168

     And the winner is...

Wednesday sort of undid all the progress we made on Tuesday and the charts tonight are once again looking generally pretty negative.  But from a slightly wider perspective, it looks like we're still in the same rut as last week, just a bit wider ranging now.  We're near the bottom of the range, but the indicators are looking lower and the VIX is wanting to run higher.  So I hate to do it but with this sort of confusion in the charts I have no choice but to throw up my hands and call Thursday uncertain.

Single Stock Trader

Last night I said to let VZ go if it failed to run higher on Wednesday.  Well it did (fail), so this trade is over, Jack.

Wednesday stock market forecast

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

• Wednesday higher.
• ES pivot 2095.00.  Holding above is bullish.
• Rest of  week bias uncertain technically.
• Monthly outlook: bias higher.
• Single stock trader: VZ now a swing trade hold.

Recap

After looking like it was going to break to the downside on Monday, on Tuesday the Dow instead reversed course to post a decent 168 point gain. That changes the picture so let's take a quick look at the charts to see where Wednesday is headed.  There's no point in going into too much detail since with a bunch of Feddage due out, the conclusion is pretty much up in the air.
The technicals

The Dow:  After breaking to the downside on Monday from last week's tiny rangebound action, on Tuesday the Dow turned around and broke above the upper end of that range on a tall green marubozu. By putting in both lower lows and higher highs the Dow is now forming a small megaphone pattern and since those usually exit in the direction from which they were entered, that bodes well for the rest of the week. I'll also note that stochastic is now on the verge of a bullish crossover from a high level and as I always say those are often good for another day or two if higher prices.

The VIX:  Equally importantly , on Tuesday the VIX did try to break above its 200-day MA as I predicted last night. But this attempt failed even worse than Monday's and the VIX ended giving up totally, dropping over 9% on a fat inverted hammer. That sent the indicators right back to oversold and cancelled what looks like a developing bullish stochastic crossover. It also broke support at 15.14 and left the VIX just above its next support level at 14. So with nothing at all between here and there it's entirely possible that it could go lower again on Wednesday.

Market index futures: Tonight, all three futures are slightly higher at 12:19 AM EST with ES up 0.02%. After looking decidedly bearish last night, ES greatly surprised me with a major advance on Tuesday that handily cleared recent resistance around 2091 to close all the way back up to 2100 on the dot. That leaves only resistance at 2103 at this point but all indicators are now back to overbought. So it's not clear if ES has enough gas in the tank to follow through on Wednesday.

ES daily pivot: Tonight the ES daily pivot rises from 2084.42 to 2095.00.  .That still leaves ES above its new pivot so this indicator continues bullish.

Dollar index:  I was cautious about the dollar last night but on Tuesday it confirmed Monday's reversal candle with a fat gap-down red spinning top that left the indicators in disarray just short of overbought. Overall this chart looks more bearish than anything but it's hardly a given.

Euro:  After looking completely intent to reach parity by the end of the year, on Tuesday the euro staged something a major reversal with a tall green marubozu that brought it right back to 1.063. That caused all the indicators to reverse course just before they were going to hit oversold and also gave us a bullish setup on a descending RTC exit. So right now it looks like there's a chance the euro could follow through on Wednesday with some additional upside.

Transportation:  After an ugly looking Monday, on Tuesday the trans got almost all of it back following a tall red marubozu with a green one. That caused the indicators to stop their decline just before hitting oversold and also curved the stochastic around in preparation for a bullish crossover., leaving this chart sort of up in the air at the moment.

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    10      2       3           2       0.857   2314
September  7      4       8           1       0.667   1404
October    7      7       5           1       0.533    538
November   4      6       4           2       0.500   -350
December   1      0       0           0       1.000    168

     And the winner is...

Although the charts are now all looking generally bullish tonight, that's not being reflected in the futures.  My guess is that people are just going to sit on their hands until the latest Feddage is out of the way.  So much as I'm thinking this market wants to go higher, I'm going to content myself with calling Wednesday uncertain.

Single Stock Trader

Verizon was a relative laggard on the Dow Tuesday advancing just 13 cents on a spindly spinning top. That left the indicators somewhat confused and wandering around halfway between oversold and overbought. Both momentum and RSI are falling but money flow and OBV are rising. In addition the stochastic now has a freshly completed bullish crossover so at this point it's kind of a toss up. My personal inclination would be to put a stop under it at this point and if it goes down on Wednesday then just let it go. If not then let it ride.

Tuesday stock market forecast

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

• Tuesday higher.
• ES pivot 2084.42.  Holding above is bullish.
• Rest of  week bias uncertain technically.
• Monthly outlook: bias higher.
• Single stock trader: VZ still a speculative swing trade buy.

Recap

Monday ran true to historical form as the Dow lost 79 points to close out November on a down note. That now brings us to December and we go right to the charts to see where the first day might be headed.

Quote of the Week

"I'm disappointed right now".

        -   Sheldon Silver, former  Speaker of the New York State Assembly after being  found guilty in federal court of all seven counts of fraud, extortion, and money laundering against him.

Not "I'm sorry", just "disappointed".  Hey, it couldn't happen to a bigger blowhard.  Silver, you arrogant career crook.  Hopefully, you'll use your upcoming time in the slammer to contemplate the error of your ways.  This restores my faith in karma.  I guess sometimes there's justics after all.

The technicals

The Dow:  The Dow's tall red candle Monday was enough to send indicators off of their extreme overbought levels just to the very edge of overbought. The stochastic has also now completed a bearish crossover and is moving lower too. This move was also enough to break us out of last week's narrow trading range. So once again there is nothing bullish all about this chart tonight.

The VIX:  Last night I gave the VIX a better than even chance of moving higher on Monday and that's exactly what it did, gaining 6.68% to test its 200-day MA at 16.25. That test was rejected though but the VIX still managed to close just above 16 and just below the MA. This move also sent the indicators rising off of oversold and also gave us a fresh bullish stochastic crossover. This serves as confirmation for last Friday's inverted hammer and makes it likely that the VIX will take another stab at the 200 MA again on Tuesday. Basically it looks like there's still more upside available to the VIX at this point.

Market index futures: Tonight, all three futures are higher at 12:16 AM EST with ES up 0.55%. On Monday ES had its biggest drop since November 13th as it fell out of its recent trading range to close back down to 2080. That just barely sent it off of overbought and also confirmed a bearish stochastic crossover. But what's interesting to note is that the new overnight is rising significantly and that is pushing it right back into that trading range as well as curving the stochastic around to cancel the bearish crossover. So at this point it's a little premature to call ES lower on Tuesday.

ES daily pivot: Tonight the ES daily pivot falls again from 2089.92 to 2084.42.  That now puts ES back above its new pivot so this indicator turns bullish again.

Dollar index:  Last night I said the dollar still had room to run higher on Monday and so it did, gaining another 0.14%. But it did it on a perfect doji star which is something of a reversal warning. However the indicators are nowhere near overbought yet so we have to take that with a grain of salt. In fact the dollar remains in a two week long rising RTC and the upper BB is still a long ways from here. In fact there is no resistance until back to the beginning of last April. So while tonight is not outright bullish I just can't call the dollar lower yet from here.

Euro:  Last night I said that the selling in the euro didn't quite look over yet and indeed it wasn't as on Monday it fell again, this time back down - 1.0576, its lowest close since April 13th. That makes it three down in a row and the new overnight is going lower again as the euro remains in a month-long descending RTC. With the lower BB not until 1.0504 , the euro seems to be intent on touching that level before too long. In the meantime there's nothing bullish about this chart tonight.

Transportation:  Last Friday the trans exited a short descending RTC for a bullish setup. But that's why we require two days of upward activity for a confirmation of a trend reversal. And we did not get that as on Monday the trans greatly underperformed the Dow, losing 1.39% on a tall red marubozu that sent the indicators continuing lower, though they have yet to reach oversold. In any case with no support nearby until 8053 it looks like there's more downside to come here on 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    10      2       3           2       0.857   2314
September  7      4       8           1       0.667   1404
October    7      7       5           1       0.533    538
November   4      6       4           2       0.500   -350

     And the winner is...

The charts don't look all that bullish at the moment to be sure nd although the first day of most months is bullish, that's not particularly the case for December.  Still, December is one of the best months for the market and the futures are all sufficently higher that I don't feel like fighting this particular tape so I'm just going to call Tuesday higher.

Single Stock Trader

Last night I called Verizon a speculative buy and on Monday it did indeed gain another half a percent on high volume. That was enough to send the indicators moving higher though they are still only halfway to overbought. It also completed a nice bullish stochastic crossover. The resulting candle is a fat spinning top though so there's at least bit of the reversal warning here but one which requires confirmation. In the meantime I would just put a stop under this one and let it ride as we definitely don't have a solid bearish warning at this point.

Monday stock market forecast

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

• Monday lower.
• ES pivot 2089.92.  Holding below is bearish.
• Rest of  week bias uncertain technically.
• Monthly outlook: bias higher.
• Single stock trader: VZ now a speculative swing trade buy.

Recap

I decided to take last week off because I wasn't expecting much action at all on the holiday-shortened week. And nothing is pretty much what we got with the Dow trading in a tiny range all week long and moving very little. But now with everybody full of turkey and back to work again it's time to see where is market is headed on Monday. So let's get right to the charts as we close out the month

The technicals

The Dow:  There's really very little to say about this chart tonight other than the fact that the indicators are all highly overbought at this point and with a pile of dojis in place it looks like there's more downside risk and upside potential at this point.

The VIX:  Last Tuesday VIX made a failed attempt to break above its 200-day MA. That was followed by a gap-down red candle on Wednesday and then a tall inverted hammer on Friday in a short session. All of this leaves the VIX now quite oversold and the stochastic primed for a bullish crossover. Of course it's hard to say after a holiday-shortened week like this but right now it looks like the VIX has a better than even chance of moving higher on Monday.

Market index futures: Tonight, all three futures are lower at 12:47 AM EST with ES down 0.17%. After a week's worth of dojis and going nowhere, on Sunday night ES is offering us more of the same. It is down slightly in the new Sunday overnight but still within a week-long trading range. However the indicators tell a different story. They have now fallen off of extreme overbought levels and the stochastic has formed a bearish crossover. Therefore this chart definitely looks lower for Monday.

ES daily pivot: Tonight the ES daily pivot falls  from 2087.58  to 2089.92.  .That puts ES back below its new pivot so this indicator is back to bearish.

Dollar index:  The dollar meanwhile wobbled its way higher last week, but despite hitting a close not seen since last April 13th it has yet to hit overbought on the indicators. Therefore with the upper BB still a ways above us it looks like the dollar still has room to run higher on Monday.

Euro:  And similarly, last week the euro continued wending its way lower as it continued what is now a two month long descending RTC after dropping below its 200-day MA on October 22nd. That left it closing Friday at 1.0602, its lowest close since April 13th. And even with all of that the indicators are not yet oversold. And with further downside in the new Sunday overnight it looks like selling is not yet over.

Transportation:  The trans fell for two days last week before putting in a tall hammer. On Friday they rose out of a short falling RTC for a bullish setup. Indicators remain just short of overbought but the stochastic is starting to curve around for a bullish crossover. So this chart actually looks more bullish than bearish at this point.

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    10      2       3           2       0.857   2314
September  7      4       8           1       0.667   1404
October    7      7       5           1       0.533    538
November   3      6       4           2       0.455   -429

     And the winner is...

The last trading day of November according to The Stock Trader's Almanac is bearish. And the overall look of the charts tonight seems to support that. Therefore I am going to go ahead and call Monday lower.

Single Stock Trader

Verizon fell out of a rising RTC last week for a bearish setup. But that was not confirmed and instead we now have a stochastic that looks primed to form a bullish crossover as well as a bullish engulfing candle. So I am now going to call this a speculative swing trade buy for Monday.