Friday stock market forecast

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

• Friday higher only if ES stays above its pivot, else lower.
• ES pivot 2041.00.  Breaking above is bullish.
• Next week bias uncertain technically.
• Monthly outlook: bias higher.
• YM futures trader: no trade.

Recap

Last night I expressed some doubts about the ability of the market to move higher on Thursday but couldn't call it lower because of the candle situation.  Turns out Mr. Market was indeed unable to push any higher, with the Dow falling 174 points.  At least this gave us some clarity so let's go to the charts as always and see where Friday's going to wind up the first week of April.

The technicals

The Dow:  Those two odd parallel lines on last night's chart resolved to the downside on Thursday with a nearly one percent decline to clearly break out of a rising RTC for a bearish trigger.  The indicators are all now finally clearly moving lower off of overbought and the stochastic is also i full-on bearish crossover mode.  So this chart now has a clear direction lower.

The VIX: Same deal with the VIX - after Wednesday's big drop, you'd think it was poised to go lower on Thursday.  But instead it gained nearly 15% to send all the indicators moving towards overbought with a completed bullish stochastic crossover.  This chart now looks bullish.

Market index futures: Tonight, all three futures are higher at 12:25 AM EDT with ES up 0.29%.  On Thursday, ES just missed forming a rare bullish stick sandwich by breaking Tuesday's close of 2038.75 to end at 2035.  And indicators, though continuing to fall are not yet down to oversold.  Next support is 2027 and I'd not be surprised to see ES touch that on Friday.

ES daily pivot: Tonight the ES daily pivot falls from 2051.92 to 2041.00.  ES begin gearing up for an attack on it with a rally just before midnight and just broke through it as I write this thus turning this indicator bullish.

Dollar index:   The best that can be said for the dollar on Thursday is that week-long support held nicely and we ended with a 0.07% gain.  The candle was a small red spinning top but that doesn't really amount to much.  Indicators remain anemic, floundering about oversold so I don't really expect much to change here on Friday.

Euro:  Last night I wrote that "it looks like there's more downside ahead for the euro" and there was, closing back down to 1.1385 after a long-legged red spinning top.  Still, this is the sixth day in a row we've visited this level so we're still waiting for the break.  Perhaps it's coming on Friday because the new overnight is moving lower out of this trading range and all the indicators continue to fall off of extreme overbought.

Transportation:  So much for Wednesday's tall hammer in the trans.  On Thursday they just gapped down on a tall red near-marubozu for a big 1.30% loss.  That now makes it seven down in a row with indicators at extreme oversold (RSI=4.16).  We've also got a stochastic finally close to a bullish crossover so I think the trans are due for a winning day here Real Soon Now.

Accuracy: 

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      2      1       2           0       0.667     139


     And the winner is...

The jittery action in the charts continues with most of the charts looking like they're ready for more downside but a rally in progress in the overnight futures.  With ES sitting exactly on top of its new pivot this seems like a good time to make a conditional call: if ES can break above its pivot by mid-morning Friday, we'll close higher.  If on the other hand, it remains below, we'll close lower.  That's all she wrote.  See you again Sunday night!

YM Futures Trader

No trade tonight..

Thursday stock market forecast

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

• Thursday uncertain.
• ES pivot 2051.92.  Holding above is bullish.
• Friday bias lower technically.
• Monthly outlook: bias higher.
• YM futures trader: no trade.

Recap

Generally speaking, I figure that Fed Minutes days aren't worth bothering about but I began to have my doubts after Wednesday's minutes came out and Mr. Market had a snit.  Fortunately, he thought better of it and a late-afternoon rally saved my call for a higher close.  But that leaves the market continuing to be unable to put together more than two in a row for over two weeks now.  With all this up/down/up, where is Thursday headed?  We can only ask the charts for answers.

The technicals

The Dow:  On Wednesday the Dow recouped all its losses to end exactly where it began Tuesday.  This neatly arrested an incipient downtrend but leaves us needing confirmation for the next move for we are essentially now back to where we were Monday night.

The VIX: Last night I was considering the VIX to be an evening star in the making and that was essentially confirmed on Wednesday.  It wasn't a classic gap-down but the 8.63% loss on a tall red marubozu has the same effect.  That leaves the VIX right back where it ended Monday just like the Dow.

Market index futures: Tonight, all three futures are slightly lower at 1:08AM EDT with ES down 0.06%.  On Wednesday ES gave us an inverted bullish piercing pattern back to 2060.25.  The last time we saw this was February 12th and the next day was higher, though we were considerably oversold then and right now ES is just off of overbought.  I am more concerned with the failure to break resistance at 2068 over the last week.  The move lower overnight seems to suggest that there's no big rally coming on Thursday.

ES daily pivot: Tonight the ES daily pivot rises from 2042.83 to 2051.92.  That still leaves ES above its new pivot so this indicator continues bullish.

Dollar index:   On Wednesday the dollar gave it up with a big red bearish engulfing pattern for a 0.21% loss.  That leaves indicators highly oversold but with the dollar right on week-long support I question how much more downside is available here.

Euro:  Meanwhile the euro continues to remain unable to decide just where the heck it wants to go.  Over the last week it has ranged from 1.1349 to 1.1463, all to no effect.  Wednesdya' close, 1.1427 has been visited on each of the last six days.  With a continuing inability to make any head way after a big rally, I'd have to think that the next move is lower - if we ever get out of this congestion zone.

Trans, daily

Transportation:  In a bit of bearish divergence the trans lost a non-trivial 0.24% on Wednesday on a tall red hammer that very nearly touched its lower BB  Check it out.  That drove the indicators all oversold and flattened out the stochastic in preparation for a bullish crossover.  So now we have to ask - does the bearish divergence cancel out the bullish candle?  Well ya got me.  I'll be curious to see how this one plays out.  (Though I'm guessing the candles will prevail).

Accuracy: 

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      2      1       1           0       0.667     139


     And the winner is...

The market remains near the top of its recent trading range and continues having trouble breaking out.  Indicators remain on the edge of overbought and volume continues to be lackluster, all of which suggests the buyers are sitting on their hands.  But there's an absence of outright bearish signs tonight so I can't really callt he market lower.  I guess all that's left is to call Thursday uncertain.

YM Futures Trader

No trade tonight..

Wednesday stock market forecast

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

• Wednesday higher.
• ES pivot 2042.83.  Holding above is bullish.
• Rest of week  bias lower technically.
• Monthly outlook: bias higher.
• YM futures trader: no trade.

Recap

Last night's technicals played out quite nicely and the Dow fell as I expected, off 134 points.  We now move on to Wednesday, not much else to say here.

The technicals

The Dow:  After a dark cloud cover on Monday the Dow took a big dump on Tuesday with a tall red marubozu that just exited the rising RTC for a bearish setup and sent the indicators just off overbought.  So by itself, this chart continues to look bearish.

VIX, daily

The VIX: Last night I said this chart looked bullish and so it was, gaining 9.21% on Tuesday on a big gap up star.  Check this out.  OF course that's now 2/3 of a bearish evening star, so with a completed bullish stochastic crossover  and indicators not yet overbought, this is a case where we have to wait and see if the VIX will fall on Wednesday.  It's tempting, I have to say.

Market index futures: Tonight, all three futures are higher at 12:15 AM EDT with ES up 0.43%.  On Tuesday, ES confirmed Monday's harami with a big drop back down to 2038.75.  That was enough to send the indicators off overbought and complete a bearish stochastic crossover.  That all looks pretty grim... but the new overnight is actually staging a non-trivial rally that began right around the time oil started rising again - fancy that.

ES daily pivot: Tonight the ES daily pivot falls from 2061.08 to 2042.83.  And that's enough to put ES back over its new pivot so this indicator is once again bullish.

Dollar index:   The dollar is really having trouble deciding where it wants to go lately.  On Monday it put in yet another spinning top, the fifth in five days.  This one was good for a 0.12% gain but left the indicators still all oversold.  I can't draw any meaningful conclusions from this chart.

Euro:  And it's basically the same story with the euro - three spindly dojis in a row here, with Tuesday's showing a small loss back down to 1.1409.  Still that makes two lower closes in a row and with indicators remaining highly overbought and the new overnight continuing lower, it looks like there's more downside ahead for the euro.

Transportation:  Last night I wrote that "it will be interesting to see if the trans manage to bounce off the MA or fall on through on Tuesday".  Turns out it was Door Number Two as the trans dropped another 0.57% on a fat red spinning top that punched right through the 200 MA.  That sent all the indicators to oversold but the stochastic is nowhere near a bullish crossover so there's really no bullish signs here tonight.

Accuracy: 

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      1      1       1           0       0.500      26

     And the winner is...

Tonight we have a VIX that sure looks like it could move lower on Wednesday and futures staging a serious rally in the overnight.  In addition, this Wednesday is historically quite bullish according to The Stock Traders Almanac.  So while the rest of the charts aren't so hot I'm going to go with this and call Wednesday higher.

YM Futures Trader

No trade tonight..

Tuesday stock market forecast

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

• Tuesday lower.
• ES pivot 2061.08.  Holding below is bearish.
• Rest of week  bias lower technically.
• Monthly outlook: bias higher.
• YM futures trader: no trade.

Recap

Last night I wasn't ready to commit either way amid some signs that pointed to a move lower but weren't strong enough to be quite certain.  Tonight we have a bit more clarity after a day the major averages all lost a bit of ground so we move directly to the charts to analyze the fallout for Tuesday.

The technicals

The Dow:  Technically speaking (and this is after all a technical blog), on Monday the Dow looked quite bearish, with a tall red candle as a dark cloud cover that left indicators all overbought.  Furthermore, the failure to break Friday's intraday high adds to the pessimism.  Tuesday appears now to have more downside risk than upside potential.

The VIX: Despite a tall red marubozu as a bearish engulfing pattern last Friday the VIX gained nearly 8% on Monday.  That completed the incipient bullish stochastic crossover I noted last night.  The candle is now an inside harami so it's technically bullish at this point.

Market index futures: Tonight, all three futures are lower at 12:18 AM EDT with ES down 0.27%.  On Monday ES put in a tall lopsided spinning toppish-harami-like thing that tested 2071 intraday but ultimately failed.  With a new bearish stochastic crossover just completed and the overnight guiding lower, this chart now looks bearish.

ES daily pivot: Tonight the ES daily pivot rises again from 2055.75 to 2061.08. That now leaves ES below its new pivot so this indicator flips back to bearish.

Dollar index:   After a bad Fed-induced week last week, the dollah found a modicum of support the past three days that continued on Monday with a modest 0.10% decline.  Indicators are now extremely oversold and the stochastic is on the verge of a bullish crossover (%K=13, %D=14).  So with three bullish reversal signs in a row now it looks like it's about time for the dollar to move higher.

Euro:  And the euro was a mirror image of the dollar on Monday.  It is now extremely overbought with RSI=100.  Two doji stars in a row and a failure to make new intraday highs, make it look like the euro's going lower form here.  This complements my idea that the dollar's going higher (I compose both sections independently).

Trans, daily

Transportation:  Last night I noted a bearish divergence in the trans.  That was confirmed on Monday with an early one percent drop, their worst showing since March 8th in a dump that stopped exactly on their 200 day MA.  Note how last week's gravestone doji provided the top and the exponential rundown since then.With three successful tests of the MA in the last week and indicators nearly oversold, it will be interesting to see if the trans manage to bounce off the MA or fall on through on Tuesday

Accuracy: 

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      0      1       1           0       0.000    -108


     And the winner is...

Monday's action provided the clarity I was missing on Sunday night.  With some reversal signs now confirmed, I'm going to call Tuesday lower.

YM Futures Trader

No trade tonight..