Thursday, November 10, 2016

Thursday stock market forecast

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Thursday higher.
  • ES pivot 2118.50.  Holding above is bullish.
  • Friday bias uncertain technically.
  • Monthly outlook: bias lower.
  • YM futures trader::no trade tonight

Whoa!  That sure was interesting.  I finally gave up and went to bed around 2:30 AM last night with the race still undecided and the futures all in a lather.  But by the time I got up on Wednesday, the Dow was up and just kept climbing.  By the end of the day we had a 257 point green candle that showed no sign whatsoever of all the excitement in the overnight.  The Trumpocalypse proved to be as evanescent as a Hillary Clinton email.

VIX, daily
Anyone who had the guts to buy ES in the 1-2 AM timeframe (I didn't) was handsomely rewarded.  I headed over to the Huffing and Puffington Post this morning to engage in a bit of Schadenfreude reading all the moaning and wailing going on over there.  Wonh wonh wonh   So sad, too bad.  Anyway now that this obnoxious election is finally behind us, and not a minute too soon, let's see if we can make any sense of these charts for Friday.

The technicals

The VIX:  On Wednesday we got the biggest drop in the daily VIX in years a it tumbled over 23% on a giant red marubozu sending all the indicators lower.  Amazing.  I don't think I've ever seen a chart like this before.

Market index futures: Tonight, all three futures are higher at 12:20 AM EST with ES up 0.31%, having started something of a rally just after midnight. Wednesday's candle deserves a chart for this is the strangest thing I ever saw.  Look at how last night's giant red candle mysteriously morphed into this bizarre gigantic hanging man.  It also just touched its upper BB and sent the indicators overbought.  This would seem to suggest a top in progress but last night's low was so distorted by election night panic, I'm not so sure we can really rely on this candle.
ES, daily

ES daily pivot: Tonight the ES daily pivot falls from 2132.58 to 2118.50.  But ES is now back above its new pivot so this indicator flips over to bullish.


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        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   10      3       4           1       0.786     314
November   1      1       4           0       0.500     266

     And the winner is...

With the VIX coming crashing back down to earth on Wednesday and a three white soldiers pattern in the Dow, SPX, and trans, there are no real bearish signs on the charts tonight.  My only concern would be that the Dow  has in three short days gone from below 18,000 to testing its all-time highs set back in August.  But there's a fair deal of momentum going right now, something we haven't seen in a while and the overnight futures are guiding higher so I'm going to go out on a limb and call Thursday higher.

YM Futures Trader

No trade tonight.

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