Actionable ideas for the busy trader delivered daily right up front
- Friday uncertain.
- ES pivot 2344.33 Holding above is bullish..
- Next week bias uncertain technically.
- Monthly outlook: bias higher.
- YM futures trader: no trade tonight.
Last night I couldn't decide which was the market was going on Thursday so I just called it uncertain. Turns out Mr Market didn't have any idea either with the Dow ending up all of eight points and the SPX ending down two. It was a pretty staid day overall. Not even Trump yakking about how great everything is going to be could move the needle. So now we come to the end of the week and op-ex Friday. I generally don't like calling these days because of the shenanigans that op-ex often engenders. And next Monday is a holiday. But we'll take a look at the charts anyway one last time.
The end of the road
And tonight is indeed the final edition of The Night Owl Trader. Tomorrow, Friday the 17th marks the sixth anniversary of this blog, daily putting out my take on the market late at night for the following day. It's been fun but I think I've accomplished my goals. I've proven to myself that I can muster the discipline necessary to write this thing every single day, I've shared my techniques as a way of giving back to those who helped me, and I've demonstrated that technical analysis really does work. My long term average success rate is about 66% for calling the next day's close as either higher or lower, and that's pretty good in anyone's book.
But the time has come to move on. I'm going to be devoting more time to my program trading development, and that's not the sort of activity that really lends itself to blogging. I hesitate to say that this is definitively the end forever because one should never say never. Dr. Brett Steenbarger shut down his highly regarded Traderfeed blog a few years back but finally started it back up again. The same could happen here at some point. But for now at least, this is the end of the road, folks. I'll leave the blog up for historical purposes, but this is it. Many thanks to all my loyal readers for following my rants all these years.
The VIX: Last night I wasn't quite sure what to make of the jolly green giant marubozu the VIX put in on Tuesday. Was this the start of another VIX panic or just some Tweeter-induced anomaly? One nice thing about the market is that you never have to wait mroe than a day for an answer to this sort of question. Turns out the VIX had no interest in closing higher again. In fat it touche its upper BB intraday, and that was that. It was all downhill from there as the VIX ended with a 1.75% loss on a tall inverted hammer that stopped the indicators' rise before ever hitting overbought. I've always said that the upper BB is the third rail of the VIX. It never lingers there more than a day or two before retreating. So now this chart looks decidedly bearish.
Market index futures: Tonight, all three futures are slightly lower at 12:42 AM EST with ES down 0.03%.
ES daily pivot: Tonight the ES daily pivot moves little from 2344.42 to 2344.33. That leaves ES just barely above its new pivot so this indicator is now only weakly bullish.
January 10 2 7 1 0.846 595
February 5 0 7 0 1.000 626
And the winner is...
According to The Stock Traders Almanac, February op-ex Friday is generally bearish. And the futures are indeed weaker tonight in the overnight than they've been in days. Last night I didn't want to call the market lower because I wasn't seeing any reversal candles. Tonight I am. There's a nice hanging man in both the Dow and the SPX, and the trans significantly underperformed, also for the first time in days. But these are all signs that require confirmation and we still don't have that. The Dow has not yet exited its rising RTC. And the VIX is not on board for the bearish case. And Friday is options expiration. Blah blah, you already see where this is headed. I was hoping I could go out with a spectacular and brilliant call but sometimes life isn't like that. It's just Friday uncertain. It's been one heck of a ride.
That's all she wrote.
YM Futures Trader
No trade tonight.