Monday, December 19, 2016

Monday stock market forecast

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Monday higher.
  • ES pivot 2256.25.  Holding above is bullish.  Now on the "H" contract.
  • Rest of week bias uncertain technically.
  • Monthly outlook: bias higher.
  • YM futures trader: no trade tonight.

Well we called last Friday higher and it indeed got off to a nice start only to fade as the day progress finally ending with an inconsequential nine point loss.  Such are the vagaries of triple-witching Fridays.  If anything, this shows that the 20K level is proving to be a harder nut to crack than a lot of people were thinking.  Will this be the week?  Let's check the charts for clues as the year slowly winds to a close.

And a reminder - I'll be taking all of next week off.  With the last week of December bracketed with holidays I'm not expecting much action.  And I'll be taking this Friday the 23rd off too, as Christmas Eve eve and I think people will already be packing up for their holiday ski trip to Gstaad or at least Vail.  Hey, I'm the boss, I can do whatever I like.

ES, daily
The technicals

The VIX:  At least I was right when I wrote that "I'm thinking the VIX will go lower on Friday" because sure enough it fell 4.6%.  However, this did not translate to a gain in the broader market.  This is normally quite unusual but has been happening more often lately.  In any event, with a red marubozu and a new bearish stochastic crossover, it looks like the downtrend isn't over here yet.

Market index futures: Tonight, all three futures are higher at 12:31 AM EST with ES up 0.21%. We are now running the "H" contract.  ES looks to me to be putting in a symmetrical triangle that is now very close to completion.  If this works out as continuation then the next leg will be higher from here.

ES daily pivot: Tonight the ES daily pivot barely dips from 2257.83 to 2256.25.   ES remains above the new pivot so this indicator continues 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   4      4       5           3       0.636     463
December   3      3       4           1       0.571     -43

     And the winner is...

The Dow seems to be consolidating in the region just below 20K, the VIX looks ready for more downside and we're seeing some positive signs out of the futures this Sunday evening.  It's definitely not a give but I think it's enough to call Monday higher.

YM Futures Trader

No trade tonight.

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