Thursday, October 20, 2016

Thursday stock market forecast

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Thursday higher.
  • ES pivot 2135.67.  Holding above is bullish.
  • Friday bias uncertain technically.
  • Monthly outlook: bias lower.
  • YM futures trader: short at 17,670.

On Wednesday, the Dow continued its recent pattern of early gains followed by significant retracement.  Once again after a triple digit gain out the gate we ended with a modest 41 point gain.  It looks to me like a lack of confidence in the market as traders want to book early gains and are fearful of letting anything ride.  Not exactly the most optimistic environment.  Tonight we review the day's charts as always while I studiously try to avoid any mention of the third and (thankfully) last debate of the clowns on TV tonight.

The technicals

VIX, daily
The VIX:  Tonight I bring you again the VIX chart I showed last night (plus one more day) when I said that there was more downside on they way.  With another 5.69% slide Wednesday, I say to you now: QED.  The VIX is now in full-on headlong retreat mode.  In fact I'd call it lower again tonight were I not so afraid of angering the gods of hubris.

Market index futures: Tonight, all three futures are higher at 12:21 AM EDT with ES up 0.20%. 

ES daily pivot: Tonight the ES daily pivot rises from 2130.67 to 2135.67.  ES remains above its new pivot so this indicator continues bullish.


Month    right  wrong  no call  conditional  batting   DowMonth    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        9      3       4           4       0.813     756
June       8      5       7           1       0.643    1393

July       5      6       6           2       0.539    -304
August     1      3       8           0       0.250     120
September  4      5       6           0       0.444     -59
October    7      1       4           1       0.889     260

     And the winner is...

The Dow has now shown us two days of gains and a completed bullish stochastic crossover with indicators all rising.  And after a lackluster showing Tuesday the trans handily outperformed the Dow on Wednesday.  Add in a VIX that shows no signs of wanting to go higher plus rising futures in the overnight and I guess I'll just call Thursday higher.

YM Futures Trader

No trade tonight.

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