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- Thursday uncertain.
- ES pivot 2260.83. Holding above is bullish.
- Friday bias uncertain technically.
- Monthly outlook: bias higher.
- YM futures trader: no trade tonight.
Last night it was sure looking like everything was lining up for further advances on Wednesday - and that's just what we got. It wasn't a triple digit advance for the Dow like it was Tuesday but still 60 points is 60 points and we'll take it. The question now becomes, after two strong days of gains that have left us bumping up right back against the Dow 20K level, can we finally break through that on Thursday? We take a look at the charts as usual to see what we can see and perhaps come to some sort of conclusion.
The VIX: Last night I wrote that "this one looks lower again on Wednesday.". So to everyone who says that technical analysis doesn't work, so there, because the VIX fell another 7.78% on Wednesday.for two red marubozus in a row. That leaves all the indicators falling off overbought with a completed bearish stochastic crossover in full effect. But with year-long support nearby at 11.30, I'm thinking now that further downside is limited, even though I don't yet see a reversal here.
Market index futures: Tonight, all three futures are virtually unchanged at 12:37 AM EST with both ES and YM dead flat. You don't see that too often at this hour of the night.
ES daily pivot: Tonight the ES daily pivot rises again from 2175.50 to 2260.83. ES remains above its new pivot so this indicator continues bullish.
January 2 0 0 0 1.000 179
And the winner is...
The action of the past few days has brought us right back to stubborn resistance at the Dow 20K level. We also have a VIX that while still falling is nearing strong support. With the buying in the overnight futures drying up, my inclination in this situation is that we could see a topping candle on Thursday, maybe a hanging man. Accordingly I'm going to have to call Thursday uncertain. I'm definitely not looking for another triple digit gain from the Dow.
YM Futures Trader
No trade tonight.