The Hoot
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- Friday uncertain.
- ES pivot 2243.92. Holding above is bullish...
- Next week bias uncertain technically.
- Monthly outlook: bias higher.
- YM futures trader: no trade tonight.
I'll admit I was somewhat skeptical that the market could advance much further after such a big pop on Wednesday but on Thursday it managed exactly that, though with a more muted gain of 65 for the Dow. The Dow rode its upper BB higher for the second day in a row and continues to be highly overbought. This is what they mean when they say not to fight the tape.
We head off to the charts now to figure out what Friday may hold as we wrap up the first full week of December. So far it's sure looking like Santa is already here, distributing all sorts of green presents to all the good little traders.
The technicals
The VIX: For the second day in a row we got a VIX that rose along with the rest of the market. I discounted this last night but I don't know how much longer this can go on without a market dip. The candle was a tall spinning top though so there's at least a suggestion the next move could be lower.
Market index futures: Thursday night, all three futures were barely changed at 12:21 AM EST with ES exactly flat and YM up just 0.08%.
ES daily pivot: Thursday night the ES daily pivot rose again from 2228.25 to 2243.92. And once again ES remains above its new pivot so this indicator continues bullish.
There's lots of spinning tops on the charts tonight, plus a hanging man on the trans. And if you believe that oil is back to an inverse correlation with the market (it fell on Wednesday when the rest of the market rose), then Thursday's gain would be a negative sign. Meanwhile the futures are playing it close to the vest Thursday night with little change. I think we could see some profit taking on Friday and that might lead to a doji day. Either way, there's too much uncertainty here to make a definitive call so I'm afraid it just has to be Friday uncertain.
That's all she wrote. See you again Sunday night!
YM Futures Trader
No trade tonight.