Wednesday lower

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

• Wednesday lower, low confidence.
  
• ES pivot 1870.17.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

My idea that the break after three doji days would be lower played out nicely as the Dow lost 67 points on Tuesday.  It was in fact an interesting move, as we shall see shortly upon exploring the charts tonight.

The technicals (daily)

The Dow: The Dow confirmed last night's hanging man by dropping 67 points on Tuesday and thus giving a bearish RTC trigger.  We also got, not surprisingly, a bearish stochastic crossover to go with indicators now moving off overbought.  So this chart continues to look bearish.

The VIX:  On Tuesday the VIX took another crack at its 200 day MA at 14.69 and this time managed to close above it, just barely.  VVIX was up too, but on a red hanging man.  This pattern may or may not have any follow-through.  With the VIX bouncing around and no RTC going now, this one is too tough for me.

Market index futures: Tonight all three futures are a tad lower at 12:37 AM EDT with ES down by 0.05%.  Last night I wrote that "ES is more interested in moving lower next" after three days of noodling around indecisively.  Well that's what happened alright and it dropped ES out of its rising RTC on Tuesday for a bearish setup.  Indicators continue to move lower just off overbought so overall this chart now looks bearish.

ES daily pivot: Tonight the pivot drops from 1873.92  to 1870.17.  We remain below the new pivot so this indicator continues bearish.

Dollar index: On Tuesday the dollar tried to  extend its momentum from the past two days but ultimately failed, ending down just 0.05% but on a tall red candle.  This dark cloud cover-like candle is de facto bearish but the indicators remain just off oversold moving higher, so this one isn't clear at all.

Euro:Meanwhile the euro put in a nice hanging man on Tuesday as it broke away from its upper BB and formed a bearish stochastic crossover.   With the overnight guiding decidedly lower, it looks bearish for the euro on Wednesday.

Transportation: The trans dropped, like the Dow on Tuesday confirming a red spinning top ... with another red spinning top.  But this one was also a bearish RTC trigger and with the indicators now clearly topped at overbought, this chart looks bearish.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   5       2      2           1       0.750    107
March      6       0      1           0       1.000    576

     And the winner is...

Hmm - I'd like to say I see some bullish signs tonight, but I don't.  And the NYSE A/D line has been putting in lower highs and lower lows for six days now, a bearish sign.  And the SPX Hi-Lo index has not spiked lower, a move that usually precedes bottoms.  And the TLT appears to have bottomed on a bullish RTC trigger.  And Dr. Copper crashed through his 200 day MA on Tuesday continuing a three day waterfall lower.  So much as I don't like to say it, the signs all seem to be pointing toWednesday lower.

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

Tuesday lower

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

• Tuesday lower, low confidence.
  
• ES pivot 1873.92.  Holding above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Denial of the Day

I want to take this opportunity to tell the world that there is absolutely no truth whatsoever to the rumors going around that I am the inventor of Bitcoin.  I categorically deny having anything to do with it anymore.  And if any reporter from the AP wants to interview  me, I'm available any day you choose.    There's a real nice sushi joint just down the street.

Recap

The market's recent rise has been pretty much straight up - with a smattering of down days here and thee.  Was Monday one of them or is this the start of the Paul Farrellocalypse?  The nice thing about the charts is that they never get all hyped up over Internet ramblings.  So let's see what this voice of reason has to say about Tuesday now.

The technicals (daily)

The Dow: On Monday the Dow lost 34 points on an interesting hanging man.  Alone, that's a reversal sign.  Trading entirely outside the latest rising RTC that's a bearish setup.  With a failure to bust 16,463 and overbought indicators, that's a big "hmmm".  With an inverted hammer touching the upper BB and then a hanging man, methinks Mr. M. is trying to tell us something here... and it's lower.

The VIX:  Last night I wrote "the VIX looks ready to move higher Monday".  And it did - sorta, gaining a scant 0.64% in an advance that was stymied by its 200 day MA, a barrier that proved too tough to pierce.  So rebuffed like this, the VIX now looks less than energetic.  I doubt it will be able to punch through the MA on Tuesday, though a modest gain is also not out of the question.


Market index futures: Tonight all three futures are modestly lower at 12:51 AM EDT with ES down by 0.09%.  ES has been vacillating around the 1877 area for three days now, unable to either make any headway nor fall away.  While we remain in a rising RTC, the indicators have slowly started moving down off overbought, a bearish sign.  There's not really all that much to go on here, but if I had to guess, I'd cautiously suggest that ES is more interested in moving lower next.

ES daily pivot: Tonight the pivot drops from 1878.25  to 1873.92.  We're now back above the new pivot thanks only to that so this indicator turns bullish again, if only by default.

Dollar index: Friday's spinning top for the dollar resolved as a reversal with Monday gaining 0.05%.  With the indicators now oversold and the stochastic about to execute a bullish crossover, I vote for a higher dollar Tuesday..

Euro: The euro is looking tired after last Thursday's monster pop.  Unable for the second day in a row to capitalize on that it put in an anemic doji that didn't come close to Friday's high.  The new overnight started higher in a valiant effort to forge ahead but to no avail.

Transportation: The trans equivocated big time on Monday with a long-legged doji whose top failed to break Friday's high.  It also left us right outside the rising RTC for a bearish setup.  And with overbought indicators, this is a good warning of lower to come.


Accuracy (daily calls): 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   5       2      2           1       0.750    107
March      5       0      1           0       1.000    509

     And the winner is...

Things are looking a bit toppy to me tonight and the charts all seem to be low on mojo, particularly the futures.  There are now some bearish signs out there and while they're not especially compelling, they're just enough to make me go out on a limb and call Tuesday lower.

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

Monday lower

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

• Monday lower, low confidence.
  
• ES pivot 1878.25.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

The trend continues to be our friend, even as I don't see much reason to call the ,market higher.  But the fact that it's been going higher seems to suffice.  We now turn out attention to the charts as we attempt to sniff out those pesky bears to see when and if they're going to come out of hibernation.  Will it be Monday?  Read on...

The technicals (daily)

The Dow: On Friday the Dow gained 31 points with a green spinning top that ended teetering right on the edge of its rising RTC, close to but not quite a bearish setup after nearly hitting its upper BB.  That also brought the stochastic close to but not quite a bearish crossover.  So we now have some warnings of a reversal, but they frustratingly enough all require confirmation.  Se we have to wait and see how Monday plays out on this one.

The VIX:  Meanwhile. the VIX put in a funny green candle that traded mostly below Thursday's for a net 0.70% loss.  We're now right at support and the stochastic is trying to set u a bullish crossover but jut like the Dow, this one is only a suggestion of a reversal.  Nevertheless if I had to guess I'd say the VIX looks ready to move higher Monday.  A pop in VVIX back above its 200 day MA supports this notion.

Market index futures: Tonight all three futures are lower at 12:41 AM EDT with ES down by 0.25%. On Friday ES put in a long-legged doji that just tapped the upper BB.  The overnight action seems to be confirming that doji and is forming a bearish stochastic crossover.  So although we do remain in a rising RTC, the outlook for Monday is bearish.

ES daily pivot: Tonight the pivot rises from 1876.08  to 1878.25.  We moved below the old number Sunday evening and remain below the new pivot so this indicator turns bearish for the first time in a while.

Dollar index: On Friday the dollar put in something of a DCB after Thursday big dump.  The resulting spinning top indicates indecision..

Euro: And after last Thursday's big jump for the euro, on Friday it made an inverted hammer above its upper BB.  Despite this, it is continuing higher in the Sunday evening trade, so there's not any really bearish signs here for Monday.

Transportation: On Friday the trans gave us something of an inverted hammer that remained inside the rising RTC and pushed indicators further overbought while bouncing off the upper BB.  This could be a reversal sign, but one which requires confirmation.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   5       2      2           1       0.750    107
March      4       0      1           0       1.000    475

     And the winner is...

All last week I was calling for higher closes less on bullish signs and more on a lack of bearish signs.  Well it looks like tonight we're finally seeing some.  And Dr. Copper took a big dump on Friday.  So I'm going to go ahead and call Monday lower.

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

Friday higher

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

• Friday higher, low confidence.
  
• ES pivot 1876.08.  Holding above is bullish.
• Next week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

The technicals worked out well on Thursday as the Dow gained another 62 points, pretty much as I'd expected.  So as the first week of March draws to a close, let's see now where Friday is headed.

The technicals (daily)

The Dow: Thursday's action was quite bullish, canceling any doubts I was having last night with a bullish engulfing candle that pushed us back into the middle of the rising RTC,  It also brought out a bullish stochastic crossover from a high level, quite a bullish sign at least for a day or two.  So with the upper BB still about 100 points away, this chart remains bullish.

The VIX:  Last night I wrote "I expect the VIX to at least take a look at [13.65] on Thursday" and that almost happened as the VIX bottomed at 13.73.  But the VIX ultimately rose 2.30% in an unusual correlation with the Dow which was also higher.  This bullish engulfing candle makes me think the VIX could now go higher again on Friday.

Market index futures: Tonight all three futures are higher at 12:47 AM EST with ES up by 0.15%.  Little has changed since last night - we remain in a rising RTC and I still think we're headed to the upper BB, now at 1888.

ES daily pivot: Tonight the pivot rises yet again from 1871.92  to 1876.08.  And once again we remain above the new pivot even as it continues higher, so this indicator is still bullish.

Dollar index: On Thursday the dollar took a big dive, down 0.56% and surprising me greatly as I was thinking it would go higher.  We not only cratered out of the rising RTC but also broke support at 54.68 (remember, this is the $USDUPX, not $DXY).  It also drove RSI lower and formed a bearish stochastic crossover.  But we just barely bounced off the lower BB so given the magnitude of the day's decline, it's possible we could get a bounce on Friday.

Euro: And then of course as the dollar floundered on Thursday, the euro took off, busting right through resistance from last October to close above its upper BB at 1.3861.  So I was of course wrong about this too.  Now the euro has been taking profits after big run-ups lately so I'd have to guess that's what will happen on Friday.

Transportation: On Thursday the trans continued to climb their upper BB with a nearly 1% green marubozu.  We are now just off resistance at 7570 so with the indicators now moderately overbought, Friday is do or die day to see if we can make another push higher.  I'm not sure there's enough gas left in this particular tank.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   5       2      2           1       0.750    107
March      3       0      1           0       1.000    444

     And the winner is...

The overall technical picture remains bullish tonight as the bears are all MIA.  Therefore, I can only call Friday higher.  The trend is your friend, as they say.  Happy weekend and see you again Sunday night!

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

Thursday higher

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

• Thursday higher, low confidence.
  
• ES pivot 1871.92.  Holding above is bullish.
• Friday bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

This is the Night Owl's 1000th post!

I know it seems hard to believe, and I wasn't at all sure I'd make it even one year when I first started this blog over four years ago but here we are in 2014, and still going strong publishing every night before a market day (well except for when the Olympics are on).  Many thanks to all my readers for their continuing support, and we'll see you again for number 2000.

Recap

I believe it was correct to call Wednesday uncertain as the Dow ended the day down a scant 36 points.  Now let's see if we can get a better sense of direction for where Thursday's going.

The technicals (daily)

The Dow: This is pretty much what I expected - what's the inverse of a dead cat bounce?  The Dow put in a lackluster small-range red candle at the top of Tuesday's monster pop.  Technically, that was just enough to fall out of the rising RTC for a new bearish setup.  The indicators remain vague and indecisive, wandering about just below overbought so it's hard to give them much credence here.  But there's at least a hint of reversal now but one that requires confirmation so bzzzt - no call on this chart tonight.

The VIX:  Last night I wrote "more downside now seems possible Wednesday" and that possibility came to pass as the VIX dropped another 1.5% on Wednesday.  We are now approaching a level of aupport at 13.65 but in the absence of any bullish signs, I expect the VIX to at least take a look at that number on Thursday.

Market index futures: Tonight all three futures are higher at 12:38 AM EST with ES up by 0.12%.  Last night I wrote that I expected a "small range or doji day" and ES delivered a perfect spinning top on Thursday right at the upper end of Wednesday's big pop.  But the new overnight isn't confirming that as we continue to trade inside the rising RTC.  And the indicators are only just barely overbought while the stochastic has actually formed a bullish crossover from a high level which is generally good for a day or two of further gains.  So this chart moves from indecisive back to bullish again.  The upper BB, now at 1888 is still not out of the question.

ES daily pivot: Tonight the pivot rises once again from 1863.25  to 1871.92.  Once again we remain above the new pivot so this indicator continues bullish.

Dollar index: Huh - I though the dollar would rise on Wednesday but instead it lost 0.08%.on a stubby spinning top.  We're still in the rising RTC and still have a newly minted bullish stochastic crossover so I still have to believe the dollar's going higher.

Euro: OK, we now have a pattern here. I believe I detect a descending triangle with a base around 1.3736.  This is a pretty good play that when the break comes, it will be lower.  Just sayin'.  That also squares with my call for a higher dollar.

Transportation: In a show of strength, on Wednesday the trans managed to extend Tuesday's huge gains another 0.32% even as the Dow closed down 0.22%.  This is, to me, quite impressive.  We're on the upper BB now but the trans have shown an ability to crawl up this line for quite a while.  And with no resistance now til 7571, it sees like there's more upside left.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   5       2      2           1       0.750    107
March      2       0      1           0       1.000    382

     And the winner is...

Tonight the charts are generally looking at least mildly bullish and there's really a general absence of bearish signs, so I guess I just have to call Thursday higher.

ES Fantasy Trader


Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

Wednesday uncertain

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

• Wednesday uncertain.
  
• ES pivot 1863.25.  Holding above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

Wow - what a difference a day makes, eh?  I'll bet all the Chicken Littles who sold yesterday are regretting that now.  With the Dow having its best day YTD on Tuesday, it seems that the picture has changed once again.  So let's shift our focus to Wednesday now and figure out where it's headed.

The technicals (daily)

The Dow: Monday's bearish RTC setup was canceled in a big way on Tuesday as the Dow shot up 228 points to take it all the way to the other edge of the rising RTC.  With these successive triple digits moves the indicators are bouncing around a lot so I'm watching more the upper BB now and that' not til 16,546.  And there's no resistance til 16,511 so this chart once again looks bullish.

The VIX:  Last night I wrote "I'd give better than even odds of a move lower on Tuesday than higher" and no one would take me up on that bet.  Good thing for them too because on Tuesday the VIX dumped 12% on a gap-down marubozu that crashed right back through its 200 day MA and completed a classic bearish evening star.  So more downside now seems possible Wednesday.

Market index futures: Tonight the futures are mixed at 1:2:31 AM EST with ES down by 0.05%, YM down 0.04% but NQ up 0.03%.  Call it vaguely flat.

ES daily pivot: Tonight the pivot rockets from 1841.58  to 1863.25.  Even after that huge pop we remain above the new pivot, impressively, so this indicator continues bullish.  Tuesday's stellar performance in ES canceled Monday's bearish RTC setup and drove it right back into the rising RTC and fresh record levels.  With all resistance now behind, the upper BB at 1891 beckons.  There is really nothing bearish about this chart.

Dollar index: Last night I was a bit leery that the dollar could follow through on Monday's gains but it did, up another 0.12%.  That sets up a new rising RTC off the lower BB and bends the stochastic round close to a bullish crossover, so I'm now bullish on the dollar.

Euro: The euro made some big intraday moves on Tuesday but finished with just a long-legged doji around 1.3736.  And the overnight is continuing to hang around that neighborhood.  The only guidance here is from a new bearish stochastic crossover so on that basis I'll guess the euro goes lower Wednesday.

Transportation: Some talking head on CNBC Tuesday was making a big deal of the failure of the trans to "make new highs".  Well gosh, with a 2.23% gain that handily outperformed the Dow's 1.41% and closed above the upper BB, I don't see much to complain about.  If anything, I'd expect a pause here o Wednesday as we often get the day after a big advance.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   5       2      2           1       0.750    107
March      2       0      0           0       1.000    382

     And the winner is...

Typically what we see after a big move up is a pause as the market consolidates and I see no reason to expect Wednesday will be any different.  While I'd not be going short right here, I think this is more of a wait & see situation so I'm just going to call Wednesday uncertain in the expectation of a small range or doji day.

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

Tuesday higher

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

• Tuesday higher, low confidence.
  
• ES pivot 1841.58.  Holding above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

Like shooting fish in a barrel.  You didn't have to be Carnac to see where the market was going on Monday - straight down.  Now we're left with the aftermath.  Mr. Market has a notoriously short attention span, so unless we see Putin's tanks rolling through the streets of Kiev on Tuesday, it's likely that he'll forget all about it (not to trivialize what's going on there).

The technicals (daily)

The Dow: So the Dow came off its lows by the end of Monday to form a fat hanging man.  It was enough to close just outside the latest rising RTC for a bearish setup and a bearish stochastic crossover.  So on the face of it, this chart is now technically bearish though one might want to take this with a grain of salt as with all news-related sell-offs.

The VIX:  The VIX meanwhile of course blasted off with a huge 14.29%  gap-up bang.  But the result was a nascent bearish evening star and although we have a new bullish stochastic crossover, in such cases one must be wary of gap-filling.  In fact, I'd give better than even odds of a move lower on Tuesday than higher.

Market index futures: Tonight all three futures are higher at 12:38 AM EST with ES up by 0.24%.  On Monday ES traded entirely outside its rising RTC for a bearish setup with a sort of hammerish-spinning top thing.  But the overnight is forming as a bullish one white soldier that suggests the selling may be done at least for now.

ES daily pivot: Tonight the pivot dives from 1856.42  to 1841.58.  ANd that move combined with an overnight rise in ES was enough to drive it above its new pivot, thus turning this indicator bullish.

Dollar index: On Monday the dollar rebounded after gapping down all the way to its lower BB last Friday.  But with a bearish stochastic crossover, it's not clear the dollar can continue these gains on Tuesday.

Euro: On Monday the euro gave up most, but not all of Friday's gains with a classic bearish harami that suggests Tuesday lower.   The lack of action Monday night remaining below the pivot supports this idea.

Transportation: The trans also took a hit on Monday, though not as bad as the Dow to form a red hanging man that canceled Friday's bullish RTC trigger.  And given the lack of trendiness here recently, I'm just not feeling the love.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   5       2      2           1       0.750    107
March      1       0      0           0       1.000    154

     And the winner is...

Well the market took its expected incipient disaster hit on Monday.  Nevertheless, the world did not come to an end and the Ukrainian situation is beginning to look more like a chess match than a steel cage death match.  If so, Monday's losses look a bit overdone and we might see something of a DCB cum relief rally on Tuesday.  The VIX in particular is looking ripe for a fall so I'm going to go a bit out on the limb and call Tuesday higher.  Of course if any real shooting starts, that could all go south in a hurry.

ES Fantasy Trader

Portfolio stats:  the account remains at $100,000 as we wait for the right moment to enter our first trade of the year.  While I do think we're going lower on Friday, I still don't have a good enough edge to warrant going short just yet, so we'll just stand aside again.  There's no rush.

Monday lower

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

• Monday lower, medium confidence.
  
• ES pivot 1856.42.  Holding below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

I got my Friday call higher although it was in a bit of jeopardy on Ukrainian news last Friday afternoon as traders didn't want to be holding anything over the weekend.  And that's starting to look prudent as the Ukranian straymash seems to be degenerating rapidly.  Now I haven't mentioned it before but I have planted a secret bug in Vladimir Putin's office, so I can now reveal to the world his reaction when Obama told him that there would be "consequences" if he invaded the Ukraine.  This is what Comrade Putin had to say, and I quote "Boo wah hah hah hah hah hah! "  (The thump was presumably him falling out of his chair laughing).

Look, the Empty Suit just made a lot of noise about reducing our army to pre-WWII levels (and that's World War Two, not Eleven, for those of you who weren't there).  And he's all hot to get the US out of Iraq and Afghanistan (which is actually a good idea).  So what exactly is it that Putin is supposed to be afraid of?  I'll tell you what he's afraid of - he just saw his fellow Ukrainian friend buddy pal dictator/thug deposed via nothing more than a bunch of loud angry people parading around the town square.

The man is absolutely petrified that if this could happen there then he might be next.  And just like on Wall St. where fear always trumps greed, he's going to do everything he can to keep himself in power.  And if that involves a few tanks and troops, then so be it.  The notion that he's afraid of Obama is ludicrous.  The chickens are now coming home to the roosters and Obama's foreign policy might be summarized as "Speak softly and carry a wet noodle".  I wish him well, but having sown the wind, he is ready to reap the whirlwind.

Trader Feed is Back

And as a postscript, let me point out that it seems that Dr. Brett Steenbarger has resumed his awesome Trader Feed blog after a long absence (see link in my blog list).  I credit the good doctor for turning around my trading to consistent profitability, and I highly recommend this blog to all my readers.  This should be your number one read every day.  No excuses, just read it.

The technicals (daily)

Tonight we're just going to skip the technicals since I believe that Monday is going to be news-driven.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   5       2      2           1       0.750    107

     And the winner is...

With the futures tanking in the Sunday evening trade, Mr. Market is clearly not liking what's going on in Ukraine where things seem to be going from bad to worse.  Barring some major unexpected announcement, like say Putin resigning (which doesn't seem likely), it's looking right now like we're going to close Monday lower.  But again, Monday will be a news-driven day and on such days, the technicals don't count for much.

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

Friday higher

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

• Friday higher, low confidence.
  
• ES pivot 1847.50.  Holding above is bullish.
• Next week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

I'm glad I called Thursday as uncertain because there was really no way (that I could see) of figuring out which way the previous two doji days would resolve.  Turns out is was to the upside and that has interesting implications for Friday which will will get to with no further ado.

The technicals (daily)

The Dow: The Dow seems to be in stair-step mode now, with brief sideways moves followed by short pops higher.  With no bearish reversal signs in sight, the upper BB not til 16,467, and the indicators actually turning higher again, it looks like this pattern is set to continue for a while.

The VIX:  Last night I wrote "the VIX may want to take a peek at its 200 day MA again on Thursday at 14.64, this time as resistance", and that is just what happened on Thursday.  The VIX hit a high of 14.69 and that was basically the end of it, as it finished down just over 2%.  That keeps it in ts descending RTC and makes for a jim-dandy dark cloud cover.  With the MA rejected, lower again looks likely on Friday.

Market index futures: Tonight all three futures are lower at 12:41 AM EST with ES down by 0.13%.  ES had a pretty good day Thursday, breaking the 1850 mark as it pushes back into record territory again.  That was enough to drive the indicators overbought, but lately that's not an instant reversal sign.  The mode now seems to be for up days to be followed by consolidation, so that's not out of the question here.

ES daily pivot: Tonight the pivot rises from 1844.42  to 1847.50.  We remain above the new pivot so this indicator is still bullish.

Dollar index: I couldn't make much sense of this chart last night and on Thursday the dollar pretty much just went back over the same ground, down 0.20% to end just under where it started Wednesday.  But that's still good for a bearish engulfing pattern and a stochastic that's moving close to a bearish crossover.  So I'll take a wild guess that the dollar goes lower on Friday..

Euro: On Thursday the euro gave us a green hammer that nonetheless drove the indicators closed to oversold.  But the overnight is falling again and is about to break under the new pivot.  But tonight it's this chart that's too hard to parse, so I'll take a pass here.

Transportation: he trans got back into gear on Thursday with a nice 0.59% gain to form a bullish engulfing pattern that just cracked the descending RTC for a bullish setup  Indicators remain somewhat of a mixed picture but overall this chart is at least somewhat bullish now.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   4       2      2           1       0.714     58

     And the winner is...

The last day of the month is generally good, though in February it's just average.  In any case, tonight we have sort of the same thing as two nights ago, an absence of bearish signs more than anything looking strongly bullish.  So I guess all I can do is call Friday higher, though I'm not expecting any triple digit advances.  See you again Sunday night!

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

Thursday uncertain

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

• Thursday uncertain.
  
• ES pivot 1844.42.  Holding above is bullish.
• Friday bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Quote of the Day

"It's hard not to think that the real problem in Bitcoinland isn't denial-of-service attacks. It's denial."

      -  The Economist, on Bitcoin (whatever the heck that is) after the collapse of Mt. Gox (whatever that was).

Recap

Another one of these zig-zaggy days on Wednesday as the Dow gave up some AM gains in early afternoon selling but managed nonetheless to recover by the close to save my call for an up day.  So on we go to Thursday as we tackle tricky tactical technicals (say that three times fast).

The technicals (daily)

The Dow: The Dow has now given us two spinning tops in a row but no break lower.  With Wednesday's being something of a bullish harami and RSI now off overbought, it would seem not entirely implausible to get another leg higher form here.

The VIX:  Huh - I thought the VIX might visit 13.44 on Thursday but no such luck as it actually gained 5% in an unusual positive correlation to the market with a bullish one-white soldier candle.  Nonetheless we remain in a descending RTC and the stochastic is not yet in position for a bullish crossover.  That said, I now think the VIX may want to take a peek at its 200 day MA again on Thursday at 14.64, this time as resistance.

Market index futures: Tonight all three futures are higher at 12:05 AM EST with ES up by 0.18%. Wednesday's ES candle was a wide-ranging bearish engulfing spinning top.  The indicators seem to support a reversal from here as they continue drifting lower off overbought, but the pin-action tonight suggests otherwise and we do remain inside a week-long rising RTC.  So with mixed signals, this one's a push.

ES daily pivot: Tonight the pivot barely moves from 1844.83  to 1844.42.  We're still above the new pivot, though not by much, so for the time being this indicator is bullish, just barely.

Dollar index: I missed this one completely with the dollar gapping up 0.37% on Wednesday, not moving lower.  We're now out of a month-long descending RTC but this chart is just too herky-jerky for me, especially with indicators neither overbought nor oversold..

Euro: The euro finally broke out of its week-long consolidation and after five dojis in a row it took a big dump on Wednesday down to 1.3683.  That drove RSI oversold but the stochastic is still falling.  Support at 1.3697 is now resistance so I wouldn't be surprised to see at least a bit more downside, though honestly, this chart is really too tough to call.

Transportation: A bit of bearish divergence here as the trans lost 0.25% on Wednesday while the Dow gained 0.12%.  It was on a spinning top but it also formed a bearish stochastic crossover, so more downside could be coming here.


Accuracy (daily calls):

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   5       2      1           0       0.714     58

     And the winner is...

With not just a lack of clear direction but a number of contradictory signals in the charts tonight, I'm afraid I'm just going to have to declare Thursday uncertain.  Maybe a more clever technician than I can make sense of this mish-mosh, but I can't - and I'm not going to lose any sleep over it.  There's no need to play these low percentage plays.

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

Wednesday higher

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

• Wednesday higher, low confidence..
  
• ES pivot 1844.83.  Holding above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside.

Recap

Last night I made a conditional call for Tuesday, that we'd close higher only if ES managed to stay above its pivot by mid-morning.  ES, which dipped below the pivot around 3 AM did make a half-hearted attempt to break back above around 10:45 AM but by the time it finally got in gear it was too late and both the Dow and SPX did eventually close a bit lower.  So let's move on and see what the charts have to say about Wednesday.

The technicals (daily)

The Dow: The Dow continues to be frustrated by resistance around 16,250, ending Tuesday with a red spinning top and a failed high level bullish stochastic breakout.  But with the upper BB still still over 200 points away, we could just as easily continue higher.  However, the spinning top requires confirmation so I'm just going to have to wait and see on this one.

The VIX:  Last night I wrote about the VIX "you've got to think this one's going lower" and if you thought that you'd have been right because that's just where it went - down another 4% on Tuesday with an inverted hammer that tried and failed to recover the 200 day MA.  With an admittedly wide descending RTC now in place and a bearish stochastic crossover complete, and no sign of a reversal from VVIX, I'm not sure there couldn't be still more downside to come on Wednesday, at least to 13.44 where there's some support. 

Market index futures: Tonight all three futures are higher at 12:22 AM EST with ES up by a decent 0.27%.  That's enough to keep it firmly inside a rising RTC and provides a non-confirmation of Tuesday's spinning top.  The indicators are sort of wandering, with RSI flat just in overbought, momentum falling, but money flow and OBV rising.  And the stochastic is threaded out, with both lines virtually on top of each other, so no help there.  But the overall trend remains bullish.

ES daily pivot: Tonight the pivot inches up from 1844.00  to 1844.83.  After finally breaking above the pivot just before the close, we remain well above the new number so this indicator is now clearly bullish

Dollar index: I couldn't call this one last night and it was just as well since the dollar lost a scant 0.07% on Tuesday, and on a green spinning toppish/hammer.  Largely just more indecision.  Tonight though, we're seeing a nascent bearish stochastic crossover.  So although RSI is just coming off oversold, I'm going to guess that maybe the dollar goes lower on Wednesday..

Euro: Last night I wrote "more sideways drifting seems to be ahead" - and that's just what happened as the euro put in its fourth doji in a row, continuing to oscillate around the 1.3741 level.  With the indicators remaining overbought, the break (when and if it ever comes) would seem to be more likely headed lower.  But so far in the overnight, it just looks like more of the same consolidation.

Transportation: And while on Tuesday the Dow lost just 0.17%, the trans lost 0.67% on what as close to a bearish engulfing candle that got the stochastic into position for a bearish crossover.  ll in all, this chart now swings to bearish.


Accuracy (daily calls): 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   3       2      1           0       0.600     39

     And the winner is...

Tonight the charts seem generally bullish, despite the fact that the end of February historically underperforms.  Not a raging bull, mind you, but nonetheless enough for me to call Wednesday higher.

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

We're back, baby!

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

• Tuesday higheronly if ES stays above pivot, else lower.
  
• ES pivot 1844.00.  Holding above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader standing aside..

Recap

Well the Olympics are finally over and after OD'ing on everything from figure skating to hot dog skiing for two solid weeks,  I'm slowly starting to recover   So we fondly bid adieu to all the winners and the lugers (that joke just never gets old, does it), and it's time to return to that other endlessly entertaining circus called the stock market.  So let's get right to it, as Team Night Owl goes for the gold and a winning forecast for Tuesday.  We're back, baby!

The technicals (daily)

The Dow: Last week, the Dow dropped out of its rising RTC but the bearish setup never got a trigger and instead we got Monday's Rally of Nothing.  Or was it?  We saw high volume and a bullish stochastic crossover from a high level.  So with no resistance til 16,250, I have to think there's still some upside left here, like the Dutch speed skating team.

The VIX:  This chart was even more clear - a classic bearish stochastic crossover on Monday with a 3% drop that sliced right through the 200 day MA and hey you've got to think this one's going lower than the US men's hockey team.

Market index futures: Tonight all three futures are just a tad lower at 1: AM EST with ES down by 0.07%.  ES had a good day Monday with a bullish engulfing candle that finally managed to crack resistance at 1843 that had stood in the way all year so far.  The indicators are just overbought but haven't been terribly useful lately.  And the upper BB isn't til 1871, so more upside is possible here though the lack of pin action in the overnight does raise an eyebrow.

ES daily pivot: Tonight the pivot rises from 1837.00  to 1844.00.  That leaves ES just barely above the new pivot.  While this is still marginally bullish, ES is in easy striking distance should it decide to break under, and that would be bad.

Dollar index: The dollar spent most of the Olympics falling faster than Bode Miller on the downhill until last Thurday.  But that breakout didn't hold and now it looks like it wants to move lower again.  But the indicators remain oversold so this chart is sort of a conundrum wrapped in an enigma.  I'll need the photo finish to figure out this one.

Euro: The euro is similarly conflicted, having now put in four dojis in a row around 1.3740.  In the absence of any RTC or a clear direction, more sideways drifting seems to be ahead.

Transportation: A note of caution here.  On Monday the trans posted a decent 0.44% gain but did it on an inverted hammer that touched the upper B.  The only saving grace is that we're still a ways from overbought o this isn't automatically fatal.  But we still need to wait for the second run down the track to see if this time will hold up.


Accuracy (daily calls): 

Month    right  wrong  no call  conditional  batting   Dow
                                             average  points
January    5      10      6           0       0.333     64
February   3       2      1           0       0.600     39

     And the winner is...

I'm a bit worried about things looking somewhat overbought at the moment, but the overall patterns remain bullish, or more to the point, they don't look bearish.  I'm feeling a bit half-hearted about it all, particularly with ES's proximity to its pivot.  So I'm going to make it a conditional call: Tuesday higher onyl if ES manages to stay above its pivot by mid-morning, else lower.

ES Fantasy Trader

Portfolio stats:  the account remains at $103,000 after the first trade of 2014.  We are now 1 for 1 total, 1 for 1 long, 0 for 0 short.  Tonight we stand aside.

Happy Anniversary!

HAPPY ANNIVERSARY!

 Today, the Night Owl turns four.  An event so special, they closed the stock market in honor of it.  It seems hard to believe I've already put out 992 posts in which I try to guess which way the market will move the next day.  I've had my ups and downs but hey, I'm still here baby and that's what counts.  So stay tuned - as soon as these pesky Olympics are over, we'll be back to crack the 1000th post milestone.