The Hoot
Actionable ideas for the busy trader delivered daily right up front
- Tuesday uncertain....
- ES pivot 2110.00. Holding above is bullish.
- Rest of week bias uncertain technically.
- Monthly outlook: bias higher.
- Single stock trader: VZ not a buy.
Recap
Once again, the conditional called worked nicely with ES wandering about the pivot indecisively until the open at which point it busted through and never looked back - and we closed higher. It doesn't always work but this time it did. So after a nod to the NASDAQ for finally recapturing 5000 on Monday after 15 long years, let's move on to Tuesday.
The Technicals
The Dow: The Dow had a monster opening day of March, up 156 points on a big green marubozu for another record close that totally quashed the previous negative outlook. And with the upper BB® now floating at 18,417, there's still good deal of upside available here.
The VIX: On Monday the VIX put in a second lower red marubozu for a 2.25% loss to remain in a descending RTC. No bullish turnaround signs here at all and the lower BB is way down to 12.09. It's not out of the question we visit that level before moving higher.
Market index futures: Last night all three futures were lower at 12:10 AM EST with ES down 0.05%. On Monday ES convincingly put the kaibosh on what was looking like a bearish pattern to bounce pout of a new descending RTC and form a bullish stochastic crossover from a high level. Those are generally good for a day or two of further gains. Note though that we are now hard up on week-long resistance, so I'm not too sure that will work this time. And the overnight didn't seem too enthusiastic about it.
ES daily pivot: TLast night the ES daily pivot rose from 2104.83 to 2110.00 even. But we remain above the new pivot so this indicator continues to be bullish.
Dollar: On Monday the dollar continued higher as it gripped the upper BB like a mountain climber scaling an icy escarpment. Three green candles and no signs of reversal from the indicators - looks like we're not done going higher.
Euro: Sunday night I wrote "More downside is in store here". And we went lower. And last night was lower again. And we're not done yet.
Transportation: The trans had a great day Monday with a bullish engulfing candle that exited their descending RTC fore a bullish setup and bent the stochastic around in anticipation of a bullish crossover. Bottom line - this one just looks higher from here.
The theme lately has been for a pause after big one-day moves. We don't have any outright bearish signs right now but I'm concerned about the shape ES is in. Also we're not getting much direction from the indicators which are bumping up against extreme overbought levels, nor from the daily candles which have been wandering for four days now. So breakout or fake-out? Hard to say. Too hard for me in fact so I'm just going to wimp out and call Tuesday uncertain.
Single Stock Trader
Sunday night I wasn't too keen on Verizon Communications (NYSE:VZ) and while it did eke out a tiny gain Monday, it still faces strong resistance at 49.44. Meanwhile the indicators remain overbought and the stochastic is ominously about to form a bearish crossover. Don't buy here.