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- Friday uncertain.
- ES pivot 2137.08. Holding above is bullish.
- Next week bias uncertain technically.
- Monthly outlook: bias lower.
- YM futures trader: short at 17,670.
Had I had the courage of my convictions last night and gone with the message the candlesticks were sending, I'd have had a nice 178 point Dow jump to add into my scoreboard. But because the futures were going nowhere at the time and because the candlesticks hadn't been working at all the past few days, I punted. You anooze, you lose. And yes, Thursday's triple digit pop was as inexplicable as the down-up-down action of the rest of the week. Can we call Friday? This may be tough given that it's op-ex but I'll see if there's any sense to be made of tonight's charts and get back to you.
The VIX: On Thursday the VIX confirmed Wendesday's hanging man by dumping 10% and diving back through its 200 day MA on a tall red candle. Indicators all remain oversold so this looks like there's a lot mroe downside left here.
Market index futures: Tonight, all three futures are lower at 12:24 AM EDT with ES down 0.12%.
ES daily pivot: Tonight the ES daily pivot bumps from 2126.75 to 2137.08. ES is now back above its new pivot so this indicator flips to bullish.
January 9 5 5 0 0.643 1433
February 9 3 5 3 0.800 1133
March 8 6 6 1 0.600 222
April 6 4 8 2 0.667 416
May 9 3 4 4 0.813 756
June 8 5 7 1 0.643 1393
July 5 6 6 2 0.539 -304
August 1 3 8 0 0.250 120
September 1 1 2 0 0.500 -14
And the winner is...
It was pointed out to me that the descneding triangle doesn't always mean a break lower and indeed on Thursday we got the exact opposite. And last night's candles certainly supported Thursday's move higher. Serves me right for chickening out. One thing about Thursday's action is that it gave us a bunch of descending RTC exits good for a bullish setup. In short that means that Thursday's action might not just be a one-off.
Also note that support at 18K in the Dow has now extended to five days in a row and every additional day strengthens the support. Unfortunately, op-ex Fridays are notoriously difficult to call and I expect this one to be particularly so as traders jockey for position before the last weekend ahead of the Fed so I'm just going to stand aside once again and call Friday uncertain. We continue to live in strange times. That's all she managed to write. See you again Sunday night!
YM Futures Trader
No trade tonight.