Friday, November 18, 2016

Friday stock market forecast

The Hoot 
Actionable ideas for the busy trader delivered daily right up front
  • Friday lower.
  • ES pivot 2180.50.  Waiting for a break either higher or lower..
  • Next week bias uncertain technically.
  • Monthly outlook: bias higher.
  • YM futures trader: no trade tonight.

Last night I made a conditional call, with the market close depending on where ES was in relation to its pivot mid-morning.  Well ES broke above its pivot right at the open and remained there.  And we indeed closed higher so unlike my last try, this time it worked.  So we now look ahead to op-ex Friday as we round out the week before Thanksgiving.

The technicals

VIX, daily
The VIX:  Recall that last night I mentioned 13 as support for the VIX.  Notice where the VIX put in its low on Thursday: 12.97  Bingo.  It then bounced for a doji star that sent RSI starting to rise off extreme oversold and left the stochastic ready for a bullish crossover.

Market index futures: Tonight, all three futures are lower at 12:25 AM EST with ES down 0.10%. 

ES daily pivot: Tonight the ES daily pivot rises again from 2175.50 to 2180.50.  ES broke above its pivot on Thursday so that leaves this indicator bullish tonight.


Month    right  wrong  no call  conditional  batting   Dow
                                             average  points

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  4      5       6           0       0.444     -59
October   10      3       4           1       0.786     314
November   3      3       5           1       0.571     451
     And the winner is...

Most op-ex days are fairly tricky to call but the November one is historically quite bullish according to the Stock Traders Almanac.  However, this might not be one of them.  With the futures turning negative, a VIX giving signs of wanting to rise, and a Dow that has put in three consecutive days of lower highs while remaining extremely overbought, I'd not be surprised to see some profit-taking on Friday.

Note too that oil has failed for two days to break above its 200 day MA and that copper continues a week-long slide after a big run-up last month into early November.  The dollar also extended its gains with a big jump on Thursday.  Therefore, although I usually try to leave op-ex days alone and may live to regret it, I'm going to take a chance this time and call Friday lower.

That's all she wrote.  Recall that next week being Thanksgiving, I'm taking the entire week off so I'll see you again the Sunday evening after that.

YM Futures Trader

No trade tonight.