Thursday higher

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

• Thursday higher, low confidence.
  
• ES pivot 1839.58.  Holding above is bullish.
• Friday bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

This is very odd.  It's feeling like the summer of 2011 or whenever it was with the Greek/European debt catastrophe all over again with wild opposite triple digit swings in the Dow every day - but this time the VIX isn't in the stratosphere, it's down in the dumps.  Huh?  I'm not gonna lie (why do people always tell you they're not going to lie - do you otherwise expect they would?), I've been at this for 10 years now and I don't remember another situation like we've got now.  I don't get it.  If someone can explain these market moves to me, I'm all ears.  Meanwhile, we'll just hit the charts again even though that doesn't seem to be very productive lately.

The technicals (daily)

The Dow: After retracing Tuesday's big dump on Wednesday, the Dow continued on higher on Thursday to put us right back in last week's congestion zone.  It's like this week never even happened.  But there were some technical effects.  We shot right out of the descending RTC for a bullish setup and we got a bullish stochastic crossover.  RSI is now off oversold so with two white soldiers this chart now officially looks bullish.

The VIX:  The VIX has been a bit squirrely lately too.  It ended Wednesday exactly unchanged on a tall hammer tacked on to the bottom of Tuesday's big drop.  That leaves the VIX right about at almost year-long support.  With the stochastic about to form a bullish crossover I'd be very surprised if the VIX had much more downside left to it at these levels.

Market index futures: Tonight all three futures are modestly higher  at 12:41 AM EST with ES up by 0.05%. ES is now in a new rising RTC and I'm impressed that it has the chops to continue higher at all after two days of decent gains.  In fact we're now above last months' record close of 1841 and the upper BB isn't til 1851.  And with two white soldiers and indicators not yet overbought, this chart looks continued bullish.

ES daily pivot: Tonight the pivot jumps from 1826.67  to 1839.58.  But we were so far above the old number that even with a flat overnight, we're still above the new pivot, so this remains bullish.

Dollar index: At least I can still get something right - last night I wrote "this chart is now looking mildly bullish.".  That proved to be something of an understatement as the dollar put in 2/3 of an evening star with a big gap-up inverted hammer that peaked at recent resistance just below its upper BB.  And yet it also caused a bullish stochastic crossover.  Thusly conflicted, we're not calling this chart tonight.

Euro: And I got the euro right too when I said last night "it's looking bearish for Wednesday."  The euro put in a big red candle to finish at 1.3599.  That was enough to get indicators off overbought, create a bearish stochastic crossover, and drop it out of its rising RTC for a bearish setup.  We are however seeing a 0.11% gain in the overnight but it's not clear how long that can hang on.  I'm going to guess it won't.

Transportation: After some yo-yo action the past three days, the trans resumed their march into record territory on Wednesday, hitting the upper BB in the process and moving the indicators overbought, moving right back into their rising RTC.  That all looks bullish to me and I don't yet see a reversal sign here.

Sentiment: Once again it's time for the latest weekly TickerSense Blogger Sentiment Poll.  We continue to track the poll to see how well it performs.

Wk.# Week   % Bullish  % Bearish  NightOwl Poll SPX  Accuracy Poll

 

  1  12/31      40         48        -      -   1402   0/1

  2  1/7        47         30        +      +   1466   1/2

  3  1/14       52         15        +      +   1472   2/3

  4  1/22       50         21        +      +   1486   3/4

  5  1/28       44         26        +      +   1503   4/5

  6  2/5        40         36        +      +   1513   5/6

  7  2/11       43         25        +      +   1518   6/7

  8  2/19       21         43        -      -   1520   6/8

  9  2/25       30         52        -      -   1516   6/9

 10  3/4        29         39        -      -   1518   6/10

 11  3/11       41         26        +      +   1551   7/11

 12  3/18       41         37        +      +   1561   8/12

 13  3/25       31         38        +      -   1557   8/13    9/13

 14  4/1        38         38        +      x   1569   9/14    9/13

 15  4/8        32         50        -      -   1553   9/15    9/14

 16  4/15       33         50        +      -   1589   10/16   9/15

 17  4/22       19         63        -      -   1555   10/17   9/16

 18  4/29       33         58        -      -   1582   10/18   9/17

 19  5/6        50         31        +      +   1614   11/19  10/18

 20  5/13       37         37        +      x   1634   12/20  10/18

 21  5/20       50         25        +      +   1667   12/21  10/19

 22  5/28       37         33        +      +   1650   12/22  10/20

 23  6/3        29         38        -      -   1631   13/23  11/21

 24  6/10       38         38        +      x   1643   13/24  11/21

 25  6/17       32         40        +      -   1627   14/25  11/22

 26  6/24       13         46        -      -   1592   14/26  11/23

 27  7/1        25         42        -      -   1606   14/27  11/24

 28  7/8        42         29        +      +   1632   15/28  12/25

 29  7/15       48         22        +      +   1680   16/29  13/26

 30  7/22       42         19        +      +   1692   16/30  13/27

 31  7/29       39         17        +      +   1692   16/31  13/28

 32  8/5        46         27        +      +   1710   16/32  13/29

 33  8/12       32         41        -      -   1691   17/33  14/30

 34  8/19       23         54        -      -   1656   17/34  14/31

 35  8/26       23         50        -      -   1664   17/35  14/32

 36  9/3        21         54        -      -   1633   17/36  14/33

 37  9/9        35         30        +      +   1655   18/37  15/34

  28 9/16       40         28        +      +   1688   19/38  16/35

 39 9/23        52         36        +      +   1710   20/39  17/36

 40 9/30        39         43        +      -   1692   21/40  17/37

 41 10/7        30         33        +      -   1691   22/41  17/38

 42 10/14       48         22        +      +   1703   23/42  18/39

 43 10/21       57         30        +      +   1745   24/43  19/40

 44 10/28       59         19        +      +   1760   25/44  20/41

 45 11/4        42         25        +      +   1762   26/45  21/42

 46 11/11       39         39        +      x   1771   27/46  21/42

 47 11/18       52         30        +      +   1798   27/47  21/43

 48 11/25       58         29        +      +   1805   28/48  22/44

 49 12/2        56         26        +      +   1806   29/49  23/45

 50 12/9        55         30        +      +   1805   30/50  24/46

 51 12/16       30         43        +      -   1775   31/51  24/47

 52 12/23       38         29        +      +   1818 

  2014

 01 12/30       50         23        +      +   1841

 02  1/6        40         44        +      -   1831 

 03  1/13       ??         ??        +      ?   1842

Again, the SPX number is the closing price of the S&P on the Friday before each new poll comes out.  The "NightOwl" column is how I voted.  The "Poll" column is how the majority of participants voted.  Since the poll is for 30 days out, after the first four weeks we're able to see how well we did.  This week we see that I voted bullish four weeks ago, but the majority of the poll voted bearish so I was right and they were wrong.  Therefore with just one week left to go, the Night Owl continues 2013 with an accuracy of 31 for 51, or 61%.   And the poll as a whole dropped a bit to 24 for 47 or 51%.   Next week we'll be able to fill in the last remaining blank for 2013 and come up with the final numbers for the year.

This week we see that Ticker Sense has not updated the poll, even though the week is almost over (I'm not sure what's up with that) , so I have no new numbers to report other than the fact that I personally voted bullish once again this week.  The last time I voted bearish was last September 3rd and for the life of me I'm still not seeing any reversal signs on either the weekly or monthly SPX charts.

Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    1      5      4           0       0.167     -250

     And the winner is...

I almost hate to make any call anymore having been so wrong this month, but the technicals do look bullish to me tonight so for whatever that's worth I'm going waay out on the limb and calling Thursday higher.

ES Fantasy Trader

Portfolio stats:  the account continues the new year at $100,000 as we wait for the right moment to enter our first trade of 2014.

Wednesday uncertain

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

• Wednesday uncertain.
  
• ES pivot 1826.67.  Holding above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Arrgh!  Tuesday's 116 point pop in the Dow helped propel the Night Owl to my worst prediction performance ever, now an abysmal 0.167 average for the month so far.  At least I resisted the temptation to go short last night.  But trading is a game of persistence if nothing else.  I'm reminded of the time I went to Vegas to play blackjack, played a perfect basic strategy and still lost five hands in a row thus wiping me out.  Fortunately, I'm a bit better bankrolled here today so we soldier on to see if we can finally get one right for Wednesday.

The technicals (daily)

The Dow: The Dow recouped more than half of Monday's losses on Tuesday.  In fact it was almost exactly a perfect 0.618 Fibonacci retracement, if you're into that sort of thing.  This tall green marubozu is bullish ad it brought the stochastic very close to a bullish crossover.  The other indicators have also bottomed at oversold so this chart suddenly turns bullish again.

The VIX:  Meanwhile, I was wrong about the VIX which dropped 7.53% on Tuesday.  The bullish RTC trigger failed to produce and we now have a bearish harami.  But indicators remain just off oversold.  I've been burned so badly with this chart this month I'm not touching this one tonight.

Market index futures: Tonight all three futures are basically unchanged at 12:44 AM EST with both ES and NQ dead even and YM up just 0.03%   We got a big retracement in ES on Tuesday leaving us back in the congestion zone form last week.  The indicators are kind of bouncing around in No Man's Land between oversold and overbought, so no help there.  This chart is too tough for me.

ES daily pivot: Tonight the pivot rises from 1821.08  to 1826.67.  This move, plus the ES's rise above the pivot at 10 AM on Tuesday leaves this indicator bullish tonight.

Dollar index: And I missed the dollar call for Wednesday too as it put in a small gain for a bullish harami.  The stochastic is now down to levels from which bullish crossover start so I'd say this chart is now looking mildly bullish.

Euro: Amazingly, I managed to get both the dollar and the euro wrong for Tuesday, as the euro posted  a tiny gain on a second doji in a row.  But maybe I was just a day early because the euro is now falling hard in the overnight, down 0.28% so far.  So now it's looking bearish for Wednesday.

Transportation: The trans are now in yo-yo mode with a big 1.29% nearly erasing Monday's losses and after all that action leaving us just about where Friday closed.  It's not making much sense, technically so I have no opinion here.


Accuracy (daily calls): 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    1      5      3           0       0.167     -250

     And the winner is...

I really really wish that the people from the Fed would just shut up outside of Fed meeting days.  It really throws a big monkey wrench in the technicals.  And having been wrong, what, now four days in a row, I'm outta here - Wednesday uncertain.  That's all she wrote.

ES Fantasy Trader

Portfolio stats:  the account continues the new year at $100,000 as we wait for the right moment to enter our first trade of 2014.

Tuesday lower

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

• Tuesday lower, low confidence.
  
• ES pivot 1821.08.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Wow, I am really glad I called Monday as "uncertain", because I sure didn't expect a 179 point plunge in the Dow.  Apparently, just when we thought Mr. Market had gotten over his taperphobia, turns out he hadn't.  Thanks a lot, Lockhart.  These are the sorts of days that technical analysis just can't help - fact of life, oh well.  So let's move on and see how Tuesday will shape up, technically-wise.

The technicals (daily)

The Dow: Monday's big dump did some technical damage to the Dow.  It solidified the descending RTC and put a definitive end to the wishy-washy action of the past week.  It also drove the indicators just barely into oversold but none of this is a reversal sign so this chart continues to look bearish.

The VIX:  And as the Dow dropped, the VIX shot up nearly 10% on Monday in a move that exited the descending RTC in a big way for a bullish setup.  It also caused a bullish stochastic crossover and caused RTC to bottom at oversold.  So this chart's now looking bullish.

Market index futures: Tonight all three futures are marginally lower at 1:25 AM EST with ES dead flat but both YM and NQ down 0.06%.  ES took a big hit on Monday with a giant red candle that sliced clear through the rising RTC for a bearish setup and formed a bearish stochastic crossover.  While the overnight seems to be stabilizing a bit at this hour, there's really nothing technically bullish on this chart right now.

ES daily pivot: Tonight the pivot dives from 1835.50  to 1821.08.  And even that move wasn't enough to put ES back above the new pivot, so this indicator is still bearish tonight, by a fair amount.

Dollar index: Last night I wrote "this chart remains bearish" and the dollar indeed lost another 0.18% on Monday to establish a new descending RTC and set the indicators moving off overbought towards oversold.  With two black soldiers, this chart still remains bearish.

Euro: The euro did not mirror the dollar on Monday, putting in instead a lopsided spinning top and unable to make any headway past resistance at 1.3686.  With indicators nearly overbought and the overnight moving lower and just dipping below the pivot, this chart looks bearish.  Of course that means either this call is wrong, or my dollar call is wrong - can't help it - that's just how these two charts look to me.

Transportation: Last night I mentioned that the trans looked to be going exponential and said "a top just has to be coming soon".  And that's exactly what happened - the trans rose until 11 AM when they hit their upper BB and then boom, down in flames for a 1.40% loss.  Those pesky exponentials get you every time.  So we now have an RTC exit for a bearish setup, a bearish engulfing candle, indicators turning back down and a stochastic getting set for a bearish crossover.  So this chart looks distinctly negative now.


Accuracy (daily calls): 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    1      4      3           0       0.200     -134

     And the winner is...

After such a sudden and unexpected move down I really want to say we have a DCB coming but I just can't ignore the fact that all the charts are now looking pretty ugly.  On the bright side, Monday's move brought us very quickly a lot closer to being oversold, but for now all I'm seeing is Tuesday lower.

ES Fantasy Trader

Portfolio stats:  the account continues the new year at $100,000 as we wait for the right moment to enter our first trade of 2014.

Monday uncertain

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

• Monday uncertain.
  
• ES pivot 1835.50.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

January is not a kind month to the Night Owl.  Last year was the only month I had a negative prediction ratio and so far this year is starting out no different.  Though both the SPX and Nasdaq were higher on Friday, the Dow was not, so that counts as a miss.  With a disappointing jobs number now behind us, let us consult the charts once again to see whither goeth Monday.

The technicals (daily)

The Dow: It is possible to draw a descending RTC for the Dow from the high on December 31st, but it's not a very good one (Pearson's = just 0.786).  If anything the Dow found support, once again in the 16,426 area.  Indicators continue to drift lower but are not yet down to oversold.  The candle was a spinning top, the second in a row so who knows.  Overall, it looks weakly bearish but I'm tired of getting burned so no call here tonight.

The VIX:  At least I nailed this one when I wrote last Thursday "the VIX is headed down on Friday".  And we got some more divergence as it dropped 5.82% while the SPX gained just 0.23% and the Dow was actually lower.  At 12.14, the VIX is now right on some pretty decent support and has now gone oversold.  The stochastic is not quite yet ready for a bullish crossover and VVIX looks to be in no hurry to move higher.  So overall, no reversal sign here quite yet, though we're definitely getting close.  Monday could be a bottoming day for the VIX.

Market index futures: Tonight all three futures are lower at 12:13 AM EST with ES down by a non-trivial 0.22%.  After three consecutive days of dojis, ES is starting to feel toppy here.  The Sunday overnight candle is developing as bearish engulfing and OBV has just turned lower.  RSI is nearly overbought and the stochastic is flattening out for a bearish crossover.  I'm not feeling the love here tonight.

ES daily pivot: Tonight the pivot rises from 1832.08  to 1835.50.  Unfortunately, the overnight dip in ES combined with the gain in the pivot dropped us below the new number right at midnight so this indicator turns bearish.

Dollar index: Last Thursday night I wrote about the dollar that  "the next logical move is lower".  .And logic prevailed as the buck dropped a big 0.47% on Friday with a tall red marubozu that peaked all the indicators on overbought.  It also gave use a bearish stochastic crossover so with the usual caveats about the possibility of a DCB after such a big one-day move, this chart remains bearish.

Euro: And last Thursday night I also wrote "the euro looks higher for Friday".  And it was indeed with a big payoff from Thursday's RTC bullish trigger.   And it's continuing higher in the Sunday overnight.  With a nicely-completed bullish stochastic crossover and indicators still only halfway to overbought, I see further upside for the euro.

Transportation: The trans ended last week remarkably with a 1.17% gain that trounced the Dow's 0.05% loss.  In fact the damn things are going quite exponential and have very nearly hit their upper BB at 7488.  Even at that, they're still not yet overbought.  You'd think this would be bullish for the Dow but whatever cross-currents are operating right now are beyond me - I don't get it.  In any case, it's quite remarkable.  I don't know how much higher the trans can go from here.  A top just has to be coming soon.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    1      4      2           0       0.200     -134

     And the winner is...

Tonight we have the Dow continuing its conflicted course, the VIX possibly bottoming, the futures looking bearish but the trans looking quite bullish.  After getting burned so often this month so far and with these sorts of conflicting signals, I'm just going to have to call Monday uncertain.

ES Fantasy Trader

Portfolio stats:  the account continues the new year at $100,000 as we wait for the right moment to enter our first trade of 2014.

Friday higher

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

• Friday higher, low confidence.
  
• ES pivot 1832.08.  Holding above is bullish.
• Next week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Thursday ended up being pretty uneventful with a Dow down all of 18 points while the SPX was up all of 0.64.  So as the market continues to look for direction, let's see if the charts have any guidance for Friday.

The technicals (daily)

The Dow - is  it in front or in back?

The Dow: The Dow is now in one of these Necker cube illusions.  Looked at one way and it's in a shallow descending trend.  Looked at another way and it's just in some sideways consolidation.  Either way, the famous First Five Days of January indicator was a flop.  But all is not lost - a down five days isn't as good a predictor of a bad year as an up five days is of a good year.

But with a long-legged red spinning top on Thursday and the indicators just nervously wandering about between overbought and oversold,  this chart is remarkably opaque.  I just have to take a pass on this one.

The VIX:  The VIX barely eked out a 0.16% gain on Thursday with a tall inverted hammer that just failed to escape its descending RTC,  Indicators continue to fall and VVIX is looking lower, so I'd say the VIX is headed down on Friday.

Market index futures: Tonight all three futures are higher at 1:04 AM EST with ES up by 0.15%.  ES has now given us two dojis in a row with Thursday's having a larger range than Wednesday's forming a mini-megaphone.  RTC-wise Thursday was the payoff for Wednesday's bullish trigger.  Indicators are now rising off oversold and with the overnight moving higher, this chart is looking good for Friday.

ES daily pivot: Tonight the pivot inches up from 1830.92  to 1832.08.  After breaking above the old number Thursday afternoon, ES has just continued to rise, leaving us sufficiently above the new pivot to call this indicator bullish.

Dollar index: The dollar completed a bearish evening star pattern on Thursday, falling off its upper BB with a small loss.  With indicators now quite overbought, the next logical move is lower..

Euro: And the euro is mirroring the dollar nicely with a tall spinning top on Thursday a la bullish piercing pattern.  The overnight is gapping up enough to cause RSI to bottom at oversold, so the euro looks higher for Friday.  That squares with my dollar lower call (I look at each chart independently).

Transportation: Some big bullish divergence in the trans on Thursday as they outperformed the Dow with a nearly 1% gain to the Dow's 0.11% loss.  This move also gave us a bullish RTC setup and a completed bullish stochastic crossover.  There's some resistance at 7400 but the upper BB isn't til 7469.  So with a decent three day winning streak going, this chart looks bullish on its own as well as being positive, Dow Theory-wise.

Sentiment: Once again it's time for the latest weekly TickerSense Blogger Sentiment Poll.  We continue to track the poll to see how well it performs.

Wk.# Week   % Bullish  % Bearish  NightOwl Poll SPX  Accuracy Poll

  1  12/31      40         48        -      -   1402   0/1

  2  1/7        47         30        +      +   1466   1/2

  3  1/14       52         15        +      +   1472   2/3

  4  1/22       50         21        +      +   1486   3/4

  5  1/28       44         26        +      +   1503   4/5

  6  2/5        40         36        +      +   1513   5/6

  7  2/11       43         25        +      +   1518   6/7

  8  2/19       21         43        -      -   1520   6/8

  9  2/25       30         52        -      -   1516   6/9

 10  3/4        29         39        -      -   1518   6/10

 11  3/11       41         26        +      +   1551   7/11

 12  3/18       41         37        +      +   1561   8/12

 13  3/25       31         38        +      -   1557   8/13    9/13

 14  4/1        38         38        +      x   1569   9/14    9/13

 15  4/8        32         50        -      -   1553   9/15    9/14

 16  4/15       33         50        +      -   1589   10/16   9/15

 17  4/22       19         63        -      -   1555   10/17   9/16

 18  4/29       33         58        -      -   1582   10/18   9/17

 19  5/6        50         31        +      +   1614   11/19  10/18

 20  5/13       37         37        +      x   1634   12/20  10/18

 21  5/20       50         25        +      +   1667   12/21  10/19

 22  5/28       37         33        +      +   1650   12/22  10/20

 23  6/3        29         38        -      -   1631   13/23  11/21

 24  6/10       38         38        +      x   1643   13/24  11/21

 25  6/17       32         40        +      -   1627   14/25  11/22

 26  6/24       13         46        -      -   1592   14/26  11/23

 27  7/1        25         42        -      -   1606   14/27  11/24

 28  7/8        42         29        +      +   1632   15/28  12/25

 29  7/15       48         22        +      +   1680   16/29  13/26

 30  7/22       42         19        +      +   1692   16/30  13/27

 31  7/29       39         17        +      +   1692   16/31  13/28

 32  8/5        46         27        +      +   1710   16/32  13/29

 33  8/12       32         41        -      -   1691   17/33  14/30

 34  8/19       23         54        -      -   1656   17/34  14/31

 35  8/26       23         50        -      -   1664   17/35  14/32

 36  9/3        21         54        -      -   1633   17/36  14/33

 37  9/9        35         30        +      +   1655   18/37  15/34

 38  9/16       40         28        +      +   1688   19/38  16/35

 39 9/23        52         36        +      +   1710   20/39  17/36

 40 9/30        39         43        +      -   1692   21/40  17/37

 41 10/7        30         33        +      -   1691   22/41  17/38

 42 10/14       48         22        +      +   1703   23/42  18/39

 43 10/21       57         30        +      +   1745   24/43  19/40

 44 10/28       59         19        +      +   1760   25/44  20/41

 45 11/4        42         25        +      +   1762   26/45  21/42

 46 11/11       39         39        +      x   1771   27/46  21/42

 47 11/18       52         30        +      +   1798   27/47  21/43

 48 11/25       58         29        +      +   1805   28/48  22/44

 49 12/2        56         26        +      +   1806   29/49  23/45

 50 12/9        55         30        +      +   1805   30/50  24/46

 51 12/16       30         43        +      -   1775

 52 12/23       38         29        +      +   1818 

  2014

 01 12/30       50         23        +      +   1841

 02  1/6        40         44        +      -   1831 

Again, the SPX number is the closing price of the S&P on the Friday before each new poll comes out.  The "NightOwl" column is how I voted.  The "Poll" column is how the majority of participants voted.  Since the poll is for 30 days out, after the first four weeks we're able to see how well we did.  This week we see that both I and the majority of the poll voted bullish four weeks ago, so we were both right.  Therefore the Night Owl continues the last few calls of 2013 with an accuracy of 30 for 50, or 60%.   And the poll as a whole rises to just above break-even at 24 for 46 or 52%.   In two weeks we'll be able to fill in the remaining blanks for 2013 and come up with the final numbers for the year.

This week we have our first divergence of the year.  I voted continued bullish while the majority voted bearish on a fairly substantial gain in bearish sentiment from last week.  I'm afraid I'm still not seeing it.  I could be wrong.

Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    1      3      2           0       0.250     -126

     And the winner is...

With the VIX, the futures, and the trans looking positive tonight, I'm just going to go ahead and call Friday higher.  Of course bad jobs numbers on Friday could torpedo that call, but the expectation seems to be for BTE (how do they know this?)  See you again Sunday night!

ES Fantasy Trader

Portfolio stats:  the account continues the new year at $100,000 as we wait for the right moment to enter our first trade of 2014.

Thursday uncertain

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

• Thursday uncertain..
  
• ES pivot 1830.92.  Holding above is bullish.
• Friday bias higher technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

Huh - well apparently we are back in one of these periods of random turbulence where the market just gets bounced around for no readily discernible reason.  Last night I said we were going higher, so the Dow went lower on Wednesday.  Doh!  We can't even blame the Fed minutes, which had no apparent impact.  Oh well - we move on to Thursday and go from there.

The technicals (daily)

The Dow: On Wednesday the Dow was unable to capitalize on Tuesday's gains, contrary to what I expected, and plopped right back into its descending RTC. canceling an incipient bullish stochastic crossover in the process.  With the indicators neither oversold nor overbought, that leaves this chart in an inscrutable morass.  So this one is just too tough for me tonight.

The VIX:  At least I had the VIX right last night when I wrote "there's still room to run lower here" as it closed down a tad, off 0.39%.  But it was a funny move with a red spinning top sitting in dark cloud cover position atop Tuesday's candle.  But with indicators continuing to decline and as we remain in a descending RTC, I still see no sign of a higher VIX.

Market index futures: Tonight all three futures are just barely higher at 1:01 AM EST with ES up by all of a single tick.  We got a lopsided green spinning top out of ES on Wednesday but with indicators continuing to rise and no evidence of it wanting to fall in the overnight, this chart continues to look ever so slightly bullish.

ES daily pivot: Tonight the pivot drops from 1828.33  to 1830.92.  Once again we remain above the new pivot so this indicator is still bullish.

Dollar index:  With ECB news coming out early Thursday morning, I expect that that is what will be moving the euro, and therefore the dollar by proxy, therefore we omit this chart tonight.

Euro: For the same reason, we also omit this chart tonight.

Transportation: Last night I wrote "this chart now turns bullish" and so it did, up 0.31% on Wednesday.  But it was with a hanging man that flattened out the indicators so this chart becomes a bit murky tonight - coudl go either way.


Accuracy (daily calls): 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points

January    1      3      1           0       0.250     -126

     And the winner is...

In general, the charts aren't all that clear tonight.  I see a slight positive bias but with potentially market-moving news coming from the ECB, I'm afraid I'm just going to have to call Thursday uncertain.

ES Fantasy Trader

Portfolio stats:  the account continues the new year at $100,000 as we wait for the right moment to enter our first trade of 2014.

Wednesday higher

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

• Wednesday higher, low confidence..
  
• ES pivot 1828.33.  Holding above is bullish.
• Rest of week bias higher technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside

Recap

It was a long shot, but one that underscores the importance of watching the VIX and the futures.  While the Dow daily chart was looking decidedly bearish last night, the other signs were bullish so I called Tuesday higher and that's all it took to finally get us on the scoreboard for 2014.  Now let's see if we can bat one in for Wednesday.

The technicals (daily)

The Dow: The Dow's big 106 point pop on Tuesday was just enough to take it all the way to the right edge of its descending RTC for a bullish setup.  It also turned all the indicators upward and set up the stochastic for a bullish crossover.  So that's the difference a day makes - this chart now looks bullish.

The VIX:  Last night I wrote "this chart looks continued bearish" and sure enough the VIX dropped another 4.65% on Tuesday.  It admittedly formed a funny gap-down green candle but with a fresh bearish stochastic crossover and the lower BB not til 11.68, it looks like there's still room to run lower here.

Market index futures: Tonight all three futures are higher at 12:15 AM EST with ES up by 0.10%.  Tuesday's tall green candle in ES completed the bullish RTC setup I mentioned last night and it also completed the bullish stochastic crossover.  Indicators remain low and there's no resistance til 1836 so I see more upside here for Wednesday.

ES daily pivot: Tonight the pivot rises from 1823.50  to 1828.33.  We remain above that number so this indicator remains bullish.

Dollar index: I did get the dollar wrong on Tuesday - I thought we'd see lower but instead it gained 0.22%.  That leaves us in a trading range with no RTC and indicators  that are not at either extreme, so there's little to go on here and consequently I'm not going to call this one..

Euro: And of course I was wrong about the euro which moved lower on Tuesday..  It is now, like the dollar, similarly conflicted with no clear direction so we'll just have to let this one be and see if Wednesday provides us with clearer guidance.

Transportation: And finally, the trans had a nice 0.74% gain on Tuesday with a bullish inside harami that moved the stochastic into position for a bullish crossover.  It wasn't clear last night, but support around 7240 held, so this chart now turns bullish.


Accuracy (daily calls): 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points

January    1      2      1           0       0.333     -58

     And the winner is...

Tonight there seems to be a general bullish consensus among the various charts so the logical call is for Wednesday higher.

ES Fantasy Trader

Portfolio stats:  the account continues the new year at $100,000 as we wait for the right moment to enter our first trade of 2014.