Actionable ideas for the busy trader delivered daily right up front
- Monday higher.
- ES pivot 2268.92. Holding above is bullish..
- Rest of week bias uncertain technically.
- Monthly outlook: bias higher.
- YM futures trader: no trade tonight.
Last Thursday night I built a pretty good case for why I thought the market would go lower on Friday. There was only one thing wrong with it - it was wrong. We did not go lower, we moved higher. The Dow seems totally fixated on that 20K level and jut keeps sniffing around ti like a dog around a fire hydrant. And we came ever so close on Friday. Close but no cigar.
So despite a decent 65 point advance, nothing's really changed. We're still chasing 20K and if anything the odds have gotten worse since the indicators have been rising for a week now and have gone from highly oversold to nearly overbought. Are we ever going to hit 20K? Let's see what the charts have to say about it for Monday
The VIX: Last Thursday I noted a spinning top in the VIX but added that this was not a particularly good reversal sign. Indeed, as the VIX kept on falling, off another 3% on Friday, this time on a red hammer. And this one is right on year-long support. With the stochastic now nearly in position for a bullish crossover, I'd be looking for a move higher soon here.
Market index futures: Tonight, all three futures are higher at 12:30 AM EST with ES up 0.12%.
ES daily pivot: Tonight the ES daily pivot rises again from 2261.42 to 2268.92. ES remains above its new pivot so this indicator simply continues bullish.
Month right wrong no call conditional batting Dow
January 2 1 1 0 0.667 114
And the winner is...
Last Thursday's hanging man did not play out on Friday. And while Mondays are always the hardest day of the week to call, the Dow is giving every impression it wants to take another crack at 20K. With its upper BB at 20,037 and the indicators still not quite overbought, there might be enough gas in the tank to reach it. Also, there aren't really any bearish signs in the trans, copper, or oil. And while the VIX looks to be readying for a move higher, it's not clear that that will happen on Monday. So I'm going to give it a shot and call Monday higher.
YM Futures Trader
No trade tonight.