Tuesday, May 10, 2016

Tuesday stock market forecast

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Tuesday higher.
  • ES pivot 2054.08.  Holding above is bullish.
  • Rest of week bias uncertain technically.
  • Monthly outlook: bias lower.
  • YM futures trader: no trade.

Herbstlicht am Genfersee Lac Leman Poster Affiche Suisse SwitzerlandWell I called Monday higher and while the SPX and the Nasdaq both indeed did end higher, the Dow did not, therefore that counts as a miss, though with just a 35 point loss, the damage was limited.  In any event we now move on to Tuesday.

[The on-again off-again Google spell checker is off again, so apologies again for any typos I missed.]

The technicals

The Dow:  The Dow was dragged down on Monday by a poor showing in CAT.  That left us with a fat red spinning top as a dark cloud cover.  But the indicators are still only just barely off oversold and the stochastic has just completed a bullish stochastic crossover.  With this sort of opposition, I'm not calling this chart tonight.

The VIX: At least I got this one right when I wrote "this chart looks ready for more downside on Monday" because the VIX fell another one percent Monday as the indicators dropped off overbought and the stochastic confirmed a bearish crossover.   That leaves this chart continuing to look negative.

Market index futures: Tonight, all three futures are higher at 1:26 AM EDT with ES up 0.19%.  On Monday ESput in a small gain on a little green spinning top.  That left the indicators all mixed up with RSI and the stochastic rising but momentum, money flow and OBV falling.  But the new overnight seems to be disconfirming the spinning top, with a move higher.

ES daily pivot: Tonight the ES daily pivot rises from 2045.92 to 2054.08. That leaves ES still above its new pivot so this indicator continues bullish.

Dollar index:   Last night I wrote "there are no bearish signs on this chart tonight" and indeed there weren't as on Monday the dollar rose another quarter percent on a fat little gap-up green spinning top.  The indicatorts are all rising towards overbought but not there yet so it's too soon to call a move lower here.

Euro:  And I was also right when I wrote "there's still more selling in store here on Monday" as the eureo continued lower this time to 1.13955 on a red spinning top.  Indicators continue their march lwoer towards oversold but are sitll not there yet and the stochastic is still nowhere near curving around for a bullish crossover.  And with the new overnight continuing lower still it's premature to call a move higher yet.

Transportation:  The trans were stuck in neutral on Monday with a small doji star stuck on top of Friday's action that took a stab at the 200 day MA but was ultimately repulsed.  But the indicators while rising remain oversold and the stochastic has just completed a bullish crossover so there still seems to be room to run here.


Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    9      5       5           0       0.643    1433
February   9      3       5           3       0.800    1133
March      8      6       6           1       0.600     222

April      6      4       8           2       0.667     416

May        2      2       1           1       0.600      -6

     And the winner is...

The forces at work last night are still in play tonight so I'm going to give this another trry.  After all both the SPX and the Nasdaq moved higher Monday and I see no reason why they should reverse course now so I'm going for the positive side again and calling Tuesday higher.

YM Futures Trader

No trade tonight..

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