The Hoot
Actionable ideas for the busy trader delivered daily right up front
- Thursday uncertain
- ES pivot 2045.17. Holding below is bearish.
- Friday bias uncertain technically.
- Monthly outlook: bias higher.
- ES Fantasy Trader standing aside.
Recap
In retrospect, "uncertain" was just about the perfect call for Wednesday, considering that the Dow ended the day down all of two points and the SPX down three. There's no way anyone can call that sort of change the day before. So now with seven completely indeterminate sessions in a row, where does that all leave us? Perhaps there's an answer in the charts. I sort of tend to doubt it at this point but what the heck, we'll look anyway.
The technicals
The Dow: Huh - the Dow was flat, then it was up when the Fed minutes came out, then it was down again, and in the end it was right back where it started. Is it any wonder I call all Fed days as "uncertain"? Ans so where does this little star doji leave us? Well right where we started. Nothing has changed. We're still sitting on the longest daily overbought streak since December 2010. Interestingly though, we've had much longer overbought streak on the monthly chart, most recently just last year, from January through August - and the market just kept going up then. So I will stop worrying about this indicator and instead note that the stochastic is just about to curve back over for a bullish crossover even as the other indicators remain stubbornly overbought. Overall though, there isnt' enough direction here to make a call.
The VIX: As further indication of the confused nature of this market, we note that on Tuesday the VIX put in a big hammer just below its 200 day MA while on Wednesday is put in a complete mirror image inverted hammer just above the same MA. How weird is that? The overall trend continues to drift vaguely higher but sitting on the very right hand edge of the rising RTC right now, this one it too tough to call.
Market index futures: Tonight, all three futures are lower at 12: 26 AM EST with ES down 0.17%. After another unexpected (by me anyway) leg higher Tuesday ES stalled out again on Wednesday with a tall skinny hanging man. But none of these technical signs seems to mean much lately and I'm tired of calling tops that don't come. Still this new overnight action is really looking like there's lower ro come.
ES daily pivot: Tonight the ES daily pivot ticks up from 2046.08 to 2045.17. We're back under the new pivot so this indicator is now bearish.
Dollar index: On Wednesday the dollar put in its second star in a row, signifying confusion but no clear direction. We've now touched the 59.49 level for 10 straight sessions, just oscillating about it. And I still see no end to that.
Euro: For its part the euro continues to drift vaguely higher with no more than two in the same direction all month so far. Like the other charts, we got a doji here on Wednesday and the overnight seems to be covering it with a bearish engulfing candle so there's no call at all here.
Transportation: On Wednesday the Trans broke support at 9016 with a 0.32% loss on a classic hammer. But indicators continue falling and are not yet oversold so that leaves us nowhere. No all here.
Tonight we're getting not so much mixed messages as garbled messages. With most charts drifting vaguely sideways lately, I've been burned several times in a row trying to make calls in what is essentially noise. So I guess I'm just going to let this one go by too and officially call Thursday uncertain, though if I absolutely had to take a wild guess, I'd say it's looking lower.
ES Fantasy Trader
Portfolio stats: the account now stands at $110,500 after ten trades in 2014, starting with $100,000. We are now 7 for 10 total, 5 for 5 long, 2 for 4 short, and one push. Tonight we stand aside.