Actionable ideas for the busy trader delivered daily right up front
- Friday higher , low confidence
- ES pivot 1786.75. Holding above is bullish.
- Next week bias higher technically.
- Monthly outlook: bias higher.
- ES Fantasy Trader standing aside
Well contrary to my expectations, the market moved lower on Thursday as Mr. Market remains in his schizophrenic "good news is bad news" haze. So let's just break out the thorazine and consider where Friday is headed. Cheers!
The technicals (daily)
The Dow: On Thursday the Dow just laughed at Wednesday's big doji and dove another 68 points to remain in a steep, narrow descending RTC. While the indicators are now quite oversold, we no longer have a reversal candle at hand, so this chart isn't really looking bullish at all right now.
The VIX: The VIX continues to confound, now having spent four full days at or above its upper BB. This is very unusual, particularly since we're not facing any really earth-shaking news like (yet another) Greek default or a US default for that matter. Just the same old same old taper talk. And with RSI now at 100 for the second day in a row, I really can't believe the next move is anything other than lower.
Market index futures: Tonight all three futures are higher at 12:28 AM EST with ES up by 0.20%. ES totally dissed Wednesday's giant doji by continuing lower on Thursday. But RSI has now clearly bottomed and the stochastic is >< that close to forming a bullish crossover. We also seem to be developing some upward momentum in the overnight with ES having already retraced half of Thursday's losses, so this chart is looking reasonably bullish now.
ES daily pivot: Tonight the pivot drops again from 1789.67 to 1786.75. In a similar situation to last night, that drop puts ES back above the pivot, so it's bullish again. And tonight it's reinforced by some upward momentum that was lacking last night.
Dollar index: At least I got the dollar nailed when I wrote last night "the next move here is likely lower" as the dollar suffered its biggest loss since September, down 0.48% on Thursday to close under its lower BB. With indicators now oversold one would think most of the selling is over by now, but looking back at the herky-jerky action in this currency over the past year, who knows.
Euro: On the other hand, I missed the euro badly as instead of continuing sideways, it took a big pop on Thursday =, handily clearing resistance at 1.3739.and closing well above its upper BB. That move, plus a 0.12% drop in the overnight so far suggests some retracement on Friday.
Transportation: There was at least a bit of encouraging new in the trans on Thursday, as they lost only 0.02% to the Dow's 0.43%. This isn't technically a reversal and the indicators are still not yet oversold, but it does now appear that the selling pressure is abating.
Accuracy (daily calls):
Month right wrong no call conditional batting Dow
January 5 7 6 3 0.533 -101
February 3 4 5 6 0.692 131
March 5 7 5 2 0.500 121
April 7 5 5 3 0.667 328
May 3 4 6 4 0.636 85
June 6 5 6 0 0.545 543
July 10 2 4 4 0.875 486
August 11 3 6 2 0.813 687
September 8 3 3 3 0.800 485
October 7 5 8 2 0.643 674
November 6 6 2 1 0.538 123
December 1 2 1 0 0.333 26
And the winner is...
I think last night's call was ore a matter of being a day early that outright wrong. And tonight things are looking somewhat more bullish than they were last night so I'm going to go waaay out on a limb and call Friday higher. With the caveat of course that this all depends on how the jobs numbers shake out - if they're really bad - or is it really good, this could all change. Perhaps I should do something that makes more sense than this market, like investing in bitcoins (whatever the heck those are). See you again Sunday night!
ES Fantasy Trader
Portfolio stats: the account remains at $110,625 after 17 trades (13 for 17 total, 7 for7 longs, 6 for 10 short) starting from $100,000 on 1/1/13. Tonight we stand aside.again.