Wednesday depends on ES pivot

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

• Wednesday higher if ES breaks above pivot, else lower.
• ES pivot 1971.92.  Breaking above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader stands aside.

Recap

Its nice when the technicals play out and Tuesday was definitely one of those days.  Last night's bearish signs all came to pass with a big 118 point dump in the Dow.  It doesn't even matter why - all that counts is that it did.  So now let's move on and see what Wednesday is going to do.

The technicals

The Dow:  The Dow just fell out of bed on Tuesday, plunging out of its rising RTC for a bullish setup that might as well be a trigger, sending RSI conclusively off overbought, giving up the 17K level like it wasn't there, and forming a bearish stochastic crossover all in one.  The only thing about this chart that might be construed as bullish is the possibility of a DCB on Wednesday.

The VIX: Last night I remarked that the VIX looked like 2/3 of an evening star but I refused to call it lower until I saw some confirmation.  And it's good that I did because on Tuesday the VIX simply continued on another 5.74% higher with a gap-up inverted hammer.  Now this one, having nearly touched its upper BB, looks more like a possible reversal.  The indicators suggest there's still room to run but the candles are a clear reversal warning.  So that's a push - and once again I demand some confirmation so we 'll just wait and see how this plays out.

Market index futures: Tonight the futures are mixed at 1:11 AM EDT with ES deaf even but YM down 0.04%.  ES on Tuesday ended up putting in a sort of heavy hammer.  It remains in a descending RTC and the indicators are all marching lower off overbought but that candlestick tail seems to suggest that the bears were unable to keep the day's lows.  And the overnight pin action suggests that the selling may be abating.

ES daily pivot: Tonight the ES daily pivot dives from 1971.92 to 161.33.  And even after all that, we're still below the new pivot, though now by less than one point.  So it's still bearish, but a test of the pivot is definitely not out of the question at this point.

Dollar index:  Last night I took a pass on this chart and it's just as well since the action was nothing to write home about with a meager 0.06% drop.  But that still makes three days of lower lows and that was enough to short-circuit the indicators lower before even reaching overbought.  So now I have to think there's more downside available here.

Euro: Well one I did not equivocate on last night was the euro when I said that I "claim the euro goes higher on Tuesday."  And so it was with the euro finishing up nicely to 1.3625 for three wins in a row.  That gives us a new rising RTC, a bullish stochastic crossover, and indicators now officially oversold.  SO this chart just looks higher still on Wednesday.

Transportation: Last night this chart was looking bearish but I held out some chance of a possible DCB.  But it was not to be, though interestingly while the Dow was just down, the trans put in a classic hammer, off just 0.10% to the Dow's 0.69%.  So now we have a conflict between a bearish RTC trigger and a bullish reversal candle.  That's also a push so no call here - though if I had to guess, I'd say we might go higher.
Accuracy:

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     12       3      6           0       0.800    431
April      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       8      10      3           2       0.500    132 July       2       0      0           0       1.000    162

     And the winner is...

There's considerable uncertainty in the charts tonight.  The VIX looks like it might head lower on Wednesday and the futures look like the selling might be done, but all of that requires confirmation.  So this looks like a good night for a conditional call: if ES manages to break above its pivot by mid-morning Wednesday, then we close higher.  If not, we close lower.

ES Fantasy Trader

Portfolio stats:  the account remains at $113,000 after seven trades in 2014, starting with $100,000.  We are now 5 for 7 total, 3 for 3 long, 2 for 3 short, and one push.  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 1971.92.  Holding below is bearish.
• Rest of week bias lower technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader stands aside.

Recap

Well things played out about as I expected on Monday.  The popular reason for the decline was interest rate fears, but you could see it coming when the Dow hit its upper BB after crossing 17K last week.  In any event, this gives us a fresh data point to work on, so let's see how the charts have changed as we look towards Tuesday.

The technicals

The Dow: On Monday the Dow clearly did not have the requisite mojo to consolidate last week's gains.  But just keeping the 17K mark was an impressive accomplishment in its own right.  But with indicators seeming to have peaked on overbought and a bearish stochastic crossover in the offing, Monday's red candle looks decidedly bearish for Tuesday..

The VIX: Holy moly - this one caught me by surprise.  I sure didn't see a 10% gap-up pop in the VIX coming Monday..  That move blew the VIX clear out of its descending RTC for a bullish setup, and squeaked out a bullish stochastic crossover, and sent the other indicators higher off oversold.  But -- this is now 2/3 of a bearish evening star.  So we now have to wait and see how this plays out on Tuesday.  There is much uncertainty here.

Market index futures: Tonight all three futures are lower at 12:16 AM EDT with ES down  0.09%.  ES now looks pretty conclusively to have topped with two red candles in a row.  Monday's action gave us a bearish stochastic crossover and the new overnight is trading outside the rising RTC for a bearish setup.  And with indicators now clearly having topped at overbought and heading lower, this chart just looks bearish.

ES daily pivot: Tonight the ES daily pivot drops from 1975.83 to 1971.92.  We remain below the new pivot so this indicator remains bearish.

Dollar index:  Despite the bullish signs last ngiht the dollar managed to drop 0.02% on Monday.  Still, it traded outside the descending RTC so that's a bullish trigger and the indicators continue to rise off oversold.  But the candles aren't looking bullish at all, so I'm going to defer on this chart tonight.

Euro: Sigh - and of course I was wrong about the euro for Monday also, as it put in a decent green hammer that closed right on the edge of its descending RTC for a bullish setup.  The stochastic is also curving around for a bullish crossover any moment now.  So I'm going to switch sides , go with that and claim the euro goes higher on Tuesday.

Transportation: And finally there was no seeing Monday's reversal in the trans either as they dropped a full percent to fall right out of their rising RTC for a bearish setup.  And a bearish stochastic crossover.  And indicators peaked on overbought.  The only hope here is for a DCB on Tuesday but that's by no means a given.

Accuracy:

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     12       3      6           0       0.800    431
April      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       8      10      3           2       0.500    132
July       1       0      0           0       1.000     44

     And the winner is...

Tonight we're seeing a bunch of reversal signs, particularly WRT regression trend channels.  Meaning something's afoot.  It's looking like the uptrend that began June 26th may now be kaput.  Also, I note that Dr. Copper put in a hanging man on Monday after an exponential run-up, always a good sign of a reversal.  And the Morningstar Market Fair Value Index is back to 1.05, as high as its been all year so far.  And the NYSE A/D line has been putting in lower highs and lower lows lately.  And the TLT looks ready to move higher.  So all in all, I think I'm just going to call Tuesday lower.

ES Fantasy Trader

Portfolio stats:  the account remains at $113,000 after seven trades in 2014, starting with $100,000.  We are now 5 for 7 total, 3 for 3 long, 2 for 3 short, and one push.  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 1975.83.  Breaking below is bearish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader stands aside.

Recap

Well I hope everyone had a happy Fourth of July and enjoyed a good barbeque.  Turns out the market provided the fireworks as the Dow cracked the historic 17,000 level for the first time last Thursday while we were on vacation.  Now that all the big players are coming back to work, what's this going to mean for Monday?  We carefully scour the charts, as always, for clues.

The technicals

The Dow: It was what I call the "knock knock" effect.  The Dow made two attempts to crack 17K earlier last month and both were rebuffed.  But I've noticed that often when you see a chart make two big pushes at a resistance level but fail, the third time is the charm.  And so it was last Thursday with a .nifty 92 point gain to get July off to a rousing start.  So we've now hit the upper BB and indicators have gone quite overbought.  But we remain in a rising RTC and in the absence of any bearish signals, I'm not calling this chart lower just yet.

The VIX: Wow - while we were gone the VIX just fell off a big cliff.  After dropping out of its rising RTC a week ago, it's gone from 11.57 to 10.32 in a reverse exponential waterfall.  I had to back out to the monthly chart to find the last time we were this low.  It was way back in February of 2007.  So with major support broken the lower BB now not til 10.06 and falling away, a solid descending RTC going, and indicators only just now entering oversold, I see nothing at all bullish about this chart.

Market index futures: Tonight all three futures are lower at 12:29 AM EDT with ES down  0.09%.  Tonight, this chart gives us something of an early warning because it did trade for a while on the fourth.  And didn't do so well unable to push past Thursday's highs.  The indicators are now quite overbought and the stochastic looks about ready to form a bearish crossover.  And the Sunday overnight continues to sag, giving this chart an overall bearish impression.

ES daily pivot: Tonight the ES daily pivot rises from 1973.92 to 1975.83.  After a late evening dip, ES is making an attempt as I write to break under the new pivot.  So at the moment, this indicator is up for grabs.

Dollar index:  After putting in a star last Tuesday the dollar took off with two consecutive gap-up days to blast out of a long-running descending RTC for a bullish setup.  We also got a bullish stochastic crossover and all the indicators are rising off oversold so this chart looks bullish for Monday.

Euro: The euro fell out of its rising RTC last Thursday for a bearish setup and then traded lower again on Friday for a bearish trigger.  The Sunday overnight is confirming that so with indicators still not yet oversold, this chart looks lower on Monday.

Transportation: The trans just barely broke resistance at 8295 intraday last Thursday before falling back for nonetheless a record close.  The tall green marubozu keeps us well within a rising RTC and we've yet to touch the upper BB, so while indicators are now moderately overbought, I see no immediate reversal signs here.

Accuracy:

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     12       3      6           0       0.800    431
April      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       8      10      3           2       0.500    132

     And the winner is...

Most of the charts are fairly old at this point and the ones that aren't are now looking vaguely bearish technically.  My general thought is that when traders come back on Monday and look over their gains from last week they may be inclined to take some money off the table.  I think Mr. Market may need a day to digest this all so I'm going to call Monday lower.

ES Fantasy Trader

Portfolio stats:  the account remains at $113,000 after seven trades in 2014, starting with $100,000.  We are now 5 for 7 total, 3 for 3 long, 2 for 3 short, and one push.  Tonight we stand aside.

Performance

Well we're basically on vacation this week but I thought it was important to update some performance stats since this is the end of the month, the quarter, and the half all rolled into one.

Accuracy: 

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     12       3      6           0       0.800    431
April      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       8       9      3           2       0.526    158

Performance:

With June and the first half of the year now closed, here are my cumulative 2014 YTD trading results so far, compared to the Dow, my benchmark.  I continue to include the results of my traditional IRA too.

        Trading    IRA       Dow
Jan.     0.50%             -5.30%
Feb.     3.94%             -1.94%
Mar.     6.01%    6.14%    -0.72%
Apr.     8.22%    8.46%     0.02%
May      9.20%    9.96%     0.85%
June    11.71%   12.42%     1.50%

June wasn't a bad month for me, especially compared to the broader markets.  My equivalent annual run rate increased a bit, and we're still handily outperforming the Dow.  So I guess so far, so good.

Monday higher

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

• Monday higher, low confidence
• ES pivot 1949.58.  Holding above is bullish.
• Rest of week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader stands aside.

Recap

With these dojis lately, it's hard to come up with a winning call.  When the Dow ends higher by less than six points, it's pretty much a toss-up.  This is why I include a "Dow points" column in my Accuracy section.  So even though we were wrong on Friday, the hit was only six points.

We now enter a big holiday-shortened week.  Not only is Friday the Fourth of July, but Thursday is only a half day.  And the One-Percenters have no doubt already helicoptered to the Hamptons. voyaged to Vail, or boated to Bermuda by now.  So this will be my only post this week, mostly because Monday is important, marking the end of the month and the end of the first half.  So let's get right to it.

The technicals

The Dow: Hmm - this is interesting.  Looking at just the real bodies, we now have a developing symmetrical triangle in the Dow.  .Following the current vaguely lower downtrend, this is de facto bearish.  But - notice that money flow turned higher on Friday and the stochastic is now on the verge of a bullish crossover.  With a double hammer going here, I'm going to guess the next move is higher.

The VIX:  Last Thursday night I wrote "I'm leaning toward calling the VIX lower on Friday"  And that was a good lean, because on Friday the VIX fell 3.18% with a red candle that prompted a bearish stochastic crossover and dropped it out of its rising RTC for a bearish setup.  So the VIX now looks lower again on Monday.

Market index futures: Tonight all three futures are higher at 12:32 AM EDT with ES up 0.05%.  ES continues in a short but rising RTC with Friday's gains non-confirming Thursday's doji.  That also took us just barely outside the descending RTC for a bullish setup  and the overnight  is providing a provisional bullish trigger.  Indicators have also now all turned higher so we're looking good here for Monday.

ES daily pivot: Tonight the ES daily pivot rises again from 1945.83 to 1949.58.  That leaves us above the new pivot so this indicator is bullish for Monday.

Dollar index:  Last Thursday night I wrote "I can't call this chart higher for Friday."  And good thing too because on Friday the dollar took a big 0.24% gap-down dump on a big red marubozu that closed just below the lower BB and keeps us in a long-running descending RTC.  So with the lower BB falling away, there's really nothing bullish about this chart for Monday.

Euro: And last Thursday night, my vague guess was that the euro go lower on Friday, but it was not to be.  The euro instead posted a big gain to close at 1.3649, its best close since June ninth.  This big move caused momentum and RSI to turn lower, but we remain overbought and well inside a rising RTC - and not too far from the 200 day MA.  I'll bet the euro is interesting in checking out that number (1.3664) on Monday.

Transportation: Last Thursday night this chart was a bit obscure.  The most I'd cop to was a vague bearish bias.  And it's good I went no further because on Friday the trans handily outperformed the Dow with a 0.31% gain and a bullish engulfing pattern.  And a new bullish stochastic crossover.  So this one looks bullish now for Monday.

Accuracy:

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     12       3      6           0       0.800    431
April      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       8       8      3           2       0.556    183

     And the winner is...

Last Friday's herky-jerky action was variously attributed to Russell rebalancing and pension funds doing end of quarter housekeeping.  Now the last day of June is typically quite bearish for stocks, but if we really did clean house last Friday, the technicals aren't looking all that bad tonight.  In fact we're seeing several signs that are usually quite reliable, like RTC exits and stochastic crossovers.  So while it makes me a bit nervous to do so, given the history, I'm going to go out of a limb and call Monday higher.

ES Fantasy Trader

Portfolio stats:  the account remains at $113,000 after seven trades in 2014, starting with $100,000.  We are now 5 for 7 total, 3 for 3 long, 2 for 3 short, and one push.  Tonight we stand aside.

Friday lower

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

• Friday lower, low confidence
• ES pivot 1945.83.  Holding below is bearish.
• Next week bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader stands aside.

Recap

Dang - wrong again!  Though I have to say I believe that the technical analysis was correct last night and the only reason the Dow finished lwo\\ower was because of some gaseous Fed-head who evidently felt the need to spout off on interest rates.  Well that's the fundamental limitation of TA - you can't account for headline risk.  Well at least the damage was limited, so let's see if we can't finish off the week with a win.

The technicals

The Dow: On Thursday the Dow put in a tall hanging man, though I'd take this with a grain of salt since I believe that was largely driven by one-off news, or opinion, actually..  And the candle could also be viewed as a hammer, depending on your time frame.  And with the indicators all now in No-Man's Land between overbought and oversold, this chart just isn't telling me much.

The VIX: And as usual, the VIX was pretty much a mirror image of the Dow, up just 0.35% with a funny inverted hammer off the bottom of Wednesday trade.  That still leaves us in a rising RTC with rising indicators, but this candle seems to have taken the mojo out of the sails of the VIX, as it were.  I'd call the trade at the lower end of Wednesday's dark cloud cover to be a confirmation of sorts, so I'm leaning toward calling the VIX lower on Friday, but it's by no means certain.

Market index futures: Tonight all three futures are lower at 12: 37 AM EDT with ES down 0.21%.  ES was unable to break through increasingly strong resistance at 1950 on Wednesday, settling instead for a tall doji star.  The indicators have just come off overbought and are drifting lower so this chart looks bearish.  The overnight action seems to be confirming that so far.

ES daily pivot: Tonight the ES daily pivot dips from 1946.67 to 1945.83.  And ES dipped below the old number just before midnight so this indicator is once again bearish.  However, we're close enough that ES might try a breakout on Friday.

Dollar index:  Sigh - I was wrong about the dollar too last night - it moved up 0.02%, not lower. But it did it on a tall inverted hammer tht really looks quit bearish.  Indicators are now back to oversold but we remain in a long-running descending RTC, so now I can't call this chart higher for Friday.

Euro: The euro on Thursday continued its choppy rise with a tall red hanging man ending with a slight gain above Wednesday.  But the indicators have now peaked at overbought and the 200 MA now seems to be out of reach, so further downside is not out of the question for Friday.

Transportation: And finally another wishy-washy chart out of the trans which dropped a scant 0.18% on Wednesday with a tall hanging man of their own.  Sitting at the top of Wednesday's candle though and with indicators continuing lower, this pattern looks a bit more bearish than anything, but it's really not crystal clear.

Accuracy:

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     12       3      6           0       0.800    431
April      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       8       7      3           2       0.588    189

     And the winner is...

The daily calls haven't been working too well lately, but that's to be expected when you get daily moves of  just15 points or 21 point in the Dow.  Tonight, the charts look bearish again, so I'll just have to call Friday lower.  That's all, she wrote.  See you again Sunday night!

ES Fantasy Trader

Portfolio stats:  the account remains at $113,000 after seven trades in 2014, starting with $100,000.  We are now 5 for 7 total, 3 for 3 long, 2 for 3 short, and one push.  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 1946.67.  Holding above is bullish.
• Friday bias uncertain technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader stands aside.

Recap

The counter-trend call has been exceptionally risky all year so far, given the market's reluctance to pull back more than two days in a row, if that.  And Wednesday was no exception as once again the buyers appeared after Tuesday's dump to rescue an otherwise weak looking chart.  So let's see where that leaves Thursday.

The technicals

The Dow:  So the Dow just laughed at Tuesday's tall red marubozu and retraced about a third of it on Wednesday.  That actually sent RSI back higher though the stochastic continues lower.  The action is nonetheless a bearish RTC trigger.  Bottom line though - this one is too tough to call.

The VIX: Huh - go figure - the VIX was looking all set yo move higher last night, but noooo... instead it dropped .4.45% on a classic dark cloud cover.  We're still in a rising RTC but with RSI having shifted lower, I'm changing my mind and now claiming the VIX goes lower on Thursday.

Market index futures: Tonight all three futures are a wee bit higher at 12:20 AM EDT with ES up 0.03%.  And just like all the other charts, ES fooled me by putting in a green bullish piercing pattern on Wednesday.  The indicators remain overbought, but that doesn't seem to count for much lately.  The overnight seems to be confirming a move higher, at least so far.

ES daily pivot: Tonight the ES daily pivot ticks down from 1947.67 to 1946.67.  We popped back up over the old number earlier Wednesday and remain above the new pivot so this indicator now turns bullish.

Dollar index:  Boy when you're wrong, you're wrong.  I missed the dollar too on Wednesday as instead of going higher it dropped 0.16%, but on a hammer that rested against the lower BB.  With indicators now rather oversold, I'm going to give it another shot and claim once again that the dollar is going higher.

Euro: At least I had the good sense last night to take a pass on the euro which did finally break out of its week-long trading range - and it was higher, in fact just touching its 200 day MA before closing at 1.3631.  With that we remain in a choppy but rising RTC so despite overbought indicators, I think we're good to go until the next assault on the 200 MA.

Transportation:  And so (sigh) finally I missed the trans too.  They did not go lower but instead came roaring back on Wednesday with a big 0.88% advance for a bullish engulfing pattern.  That leaves the stochastic stalled and potentially about to reverse for a bullish crossover from a high level which would be good for a day or two of higher.  So just forget everything I said about the trans going lower.  Doh!

Accuracy:

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     12       3      6           0       0.800    431
April      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       8       6      3           2       0.625    210

     And the winner is...

What a difference a say makes.  An outsized drop in the VIX on Wednesday coupled with reversal candles on other charts make me now think that we'll see Thursday higher.

ES Fantasy Trader

Portfolio stats:  the account remains at $113,000 after seven trades in 2014, starting with $100,000.  We are now 5 for 7 total, 3 for 3 long, 2 for 3 short, and one push.  Tonight we stand aside.

Wednesday lower

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

• Wednesday lower, low confidence
• ES pivot 1947.67.  Holding below is bearish.
• Rest of week bias lower technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader stands aside.

Recap

Huh - when I got up this morning at the crack of 11 AM I had to wonder how I could have been so wrong in calling Tuesday lower.  But not to worry as Mr. Market must have not liked his lunch and we went on a 119 point exponential cascade lower for the rest of the day, thus saving my call.  Now of course we have to figure out if this was a one-off or if there's more on the way.  The charts, as usual, tell all.

The technicals

The Dow: On Tuesday the Dow took its biggest dump in a month, off 0.70% on a tall red marubozu.  This (finally) sent the indicators off overbought, confirmed a bearish stochastic crossover, and exited the rising RTC for a bearish setup.  So with the 17,000 level rebuffed in a big way, this chart just looks lower.

The VIX:  Last night I wrote that I was "calling the VIX higher again on Tuesday.". And lucky thing too since the VIX rocketed up 10.7% on a jolly green giant marubozu for its biggest gain since April 10th.  This nicely confirms a bullish stochastic crossover, starts the indicators moving off oversold, and establishes a new rising RTC.  That all spells bullish in my book.

Market index futures: Tonight all three futures are lower at 12:49 AM EDT with ES down  0.13%.  Last night I wrote that "this looks like a chart ready to move lower".  And it was a good look as ES fell out of its rising RTC for a bearish setup, confirmed a bearish stochastic crossover and sent the indicators lower off overbought.  Those are all bearish, so this chart continues to look lower for Wednesday, and the overnight is seeming to confirm that so far.

ES daily pivot: Tonight the ES daily pivot drops from 1954.25 to 1947.67.  We remain well under the new pivot so this indicators stays bearish.

Dollar index:  Last night I didn't think the dollar was going higher but ti did anyway, though only by 0.07%.  That was good for a bullish engulfing pattern, to the extent that such small moves can be considered predictive.  Still, having just touched the lower BB on Tuesday and bounced off, I'd have to guess that Wednesday goes higher again.

Euro:  Last night I wouldn't commit to this chart which is just as well since it ended on a perfect doji - open at 1.3607, close at 1.3606.  So we continue the now four days in a row consolidation as we wait for the indecision to resolve.  And no, I'm still not guessing this one.

Transportation: Last night I wrote simply enough, "this chart now looks lower.".  Well down 0.85% is pretty lower to me.  This move gave us a bearish stochastic crossover, moved the indicators off max overbought, and made a bearish RTC trigger.  So this looks like it still has room to run lower.

Accuracy:

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     12       3      6           0       0.800    431
April      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       8       5      3           2       0.667    259
     And the winner is...

Tuesday finally provided the break that we'd been waiting for for three days.  This has now tipped the scales to bearish, technically speaking.  Therefore the logical call is for Wednesday lower.

ES Fantasy Trader

Portfolio stats:  the account remains at $113,000 after seven trades in 2014, starting with $100,000.  We are now 5 for 7 total, 3 for 3 long, 2 for 3 short, and one push.  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 1954.25.  Holding below is bearish.
• Rest of week bias lower technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader stands aside.

Recap

Ooh, close but no cigar.  I called Monday higher but the market meandered just ever so slightly underwater most of the day and we ended with the Dow down all of 10 points.  Now the Naz was up a whopping 0.64, but the call is for the Dow so this was a miss.  Not a bad one, fortunately.  So we continue to teeter on the brink.  Will Tuesday bring any resolution?  Let's check the charts as we do every night.

The technicals

The Dow: Jeez - we now have three reversal candle sin a row here - a hanging man, an inverted hanging man and on Monday yet another hanging man.  The indicators remain extremely overbought, the stochastic keeps us in antici...........pation of a bearish crossover and yet the market refuses to break lower.  It's looking like we'll need a bearish RTC exit before we get any downside action going here and for the time being, that ain't happening..

The VIX: Ahh, el VIXmo.  The chart which is el mucho importanto.  Last night I wrote "my guess is that the VIX is due to rise on Monday" although I then qualified that with some hedging.  Well it all turned out to be right as the VIX rose 1.20% on Monday, but on a gap-up red candle.. So we now have a bullish stochastic crossover by the slimmest of margins (the %K moved above the %D by a giant 0.01) and an oversold RSI.  But the chart looks like 2/3 of an evening star.  Duh-ya!  It would seem like a coin-toss but I'm going with the indicators here and calling the VIX higher again on Tuesday.

Market index futures: Tonight all three futures are lower at 12:27 AM EDT with ES down  0.12%.  On Monday ES had a canonical doji star.  Along with highly overbought indicators and a just-completed bearish stochastic crossover, this looks like a chart ready to move lower.  Note that the overnight is trading outside the rising RTC and that's a bearish setup.  The overnight supports this idea so far with a gap-down doji star.

ES daily pivot: Tonight the ES daily pivot rises from 1952.75 to 1954.25.  We fell below the pivot on Monday and remain below the new number so this indicator turns bearish.

Dollar index:  Dang!  I blew the dollar too last night.  It did not go higher but instead fell 0.13% on Monday with a gap down red candle that now looks like a bearish evening star.  That keeps the dollar in a long-running descending RTC and despite oversold indicators I see no sign here of a move higher.

Euro: Last night I wrote "the euro appears to have found a new trading range about the 1.3605 level" and guess what - hey Mikey, he likes it, as the euro spent Monday trudging over the exact same ground with a second spinning top in a row.  Meanwhile the indicators are drifting higher into overbought so my guess is that the break, when it comes will be lower.

Transportation: Oops!  Last night I thought the trans were going higher but instead they shifted into reverse for a 0.52% drop.Dow theorists take note!  This move also left us outside the rising RTC for a bearish setup, the stochastic curving around for a bearish stochastic crossover, and the indicators all overbought.  And the resistance I mentioned last night at 8222 proved insurmountable.  So this chart now looks lower.

Accuracy:

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     12       3      6           0       0.800    431
April      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       7       5      3           2       0.643    140
     And the winner is...

We had some signs of a move lower last night but I chose to go with the futures instead, much to my chagrin.  Tonight the charts are turning more definitively bearish so I feel a bit better about calling Tuesday lower.

ES Fantasy Trader

Portfolio stats:  the account remains at $113,000 after seven trades in 2014, starting with $100,000.  We are now 5 for 7 total, 3 for 3 long, 2 for 3 short, and one push.  Tonight we stand aside.

Monday higher

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

• Monday higher, low confidence
• ES pivot 1952.75.  Holding above is bullish.
• Rest of week bias lower technically.
• Monthly outlook: bias higher.
• ES Fantasy Trader stands aside.

Recap

Huh - well that's interesting.  I thought for sure we weere going lower last Friday but the day was decidedly bullish, even good for another record close for the Dow.  And yet there appear to be some storm clouds gathering on the horizon.  For the rest of the forecast, read on.

The technicals

The Dow: So we gained 26 point in the Dow on Friday.  But the interesting part is that they came on a tall inverted hammer.  Following Thursday's hanging man, that makes two reversal candles in a row.. Interestingly, we had an inverted hammer at the last triple witching and the next day was lower.  And right now even though we're not officially overbought, we're closer to it than we were last time.  So that leaves me cautiously bearish, a caution derived from the fact that we still remain in a rising RTC.

The VIX:  Now here's a bigger sign for caution.  On Friday the VIX gained 2.17% on a day when the broader market was also higher..  The candle was bullish engulfing in a big way and it also exited the descending RTC for a bullish setup.  All that's missing now is oversold indicators and we're pretty close to that.  VVIX is in a similar boat so my guess is that the VIX is due to rise on Monday.  Note though that VVIX remains in a downtrend, so I'm not all that confident on the VIX going higher.

Market index futures: Tonight all three futures are higher at 1:17 AM EDT with ES up a decent 0.20%.  With a now six day winning streak going, ES is getting pretty overextended.  RSI is now 100 - it doesn't go any higher.  And the stochastic has curved around and is on the cusp of a bearish crossover.  And yet this chart's mojo seems undiminished.  With the upper BB now at 1963, ES appears more than casually interested in taking a peek.  And that might be the catalyst for letting a bit of gas out of this bubble.

ES daily pivot: Tonight the ES daily pivot ticks up from 1948.83 to 1952.75.  So we remain above the new pivot and this indicator remains bullish.

Dollar index:  Last Thursday night I mused "we have to wonder if Friday might now come in higher."  And so it did, up 0.06% on an admittedly red spinning top that nonetheless completed a bullish morning star.  Having now hit the lower BB and with indicators fairly oversold I have to think the next move is higher again.

Euro: I wouldn't call the euro last Thursday night and it's just as well, since it ended by pretty much covering the same ground as Thursday but with a small loss on a wide-ranging spinning top.  It did however cause the indicators to peak and start lower just before hitting overbought. But for the time being, the euro appears to have found a new trading range about the 1.3605 level.

Transportation: Last Friday the trans non-confirmed Thursday's spinning top with a 0.21% advance to very near resistance at 8222.  Indicators however are still not yet overbought so in the absence of any outright bearish signs I have to say this chart remains bullish.

Accuracy:

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     12       3      6           0       0.800    431
April      9       3      5           0       0.750    482
May        6       7      6           0       0.462    -67
June       7       4      3           2       0.692    150

     And the winner is...

Tonight we're seeing a bit of a mixed picture.  It's always difficult on Sunday night because a lot of the data is now two days old.    But like the old saying goes, one of the several things you can't fight on the Street is the tape.  And right now the tape just keeps moving higher.  So although the VIX looks poised to move higher, the futures are also moving higher in the overnight in a non-trivial manner.  And so I'm going with that (and a lack of bearish signs in the Dow and trans) and calling Monday higher.

ES Fantasy Trader

Portfolio stats:  the account remains at $113,000 after seven trades in 2014, starting with $100,000.  We are now 5 for 7 total, 3 for 3 long, 2 for 3 short, and one push.  Tonight we stand aside.