Pre-open Thursday 17th December
Buyers were active intraday on Wednesday and an overlapping/higher Value Area was generated. Aggressive Buying (green-at-top) was marked. As long as ES holds above 2043 (min 1/2R) it is in a strong price location but there is proven Resistance a little higher, see below. Bulls would want to see Breadth numbers improve, see below, and Momentum turn up, see Pulse Chart.
Resistance 2087.00 (5mn poc) to 2094.00 (maj poc)
First Level Support = 2043.00 (1/2R off November’s high, Mar contract)
Support = 1965.25 (1/R off this year’s high)
Key Charts/Levels:
IWM: Resistance at 115.35 (maj poc)
SPY: Resistance at 209.90 (maj poc)
Stocks>50dyma numbers: Nyse 36% (from 26%), Nasdaq 43% (from 37%), R2000 40% (from 31%). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio was slightly lower at 7.66. SPY fell nearly 5% from the close on 12/01 but the ratio only fell by 15% which I said did not not indicate much fear and is a little worrying. However SPY has now rallied strongly for two days and the ratio is unchanged. It looks as though Rydex traders had been reluctant to commit prior to the big event day yesterday. Now that’s done let’s see how they react over the next few days.
Supporting Charts:
Bonds IEF, the 7-10 yr ETF: closed below 106.60 (18mn poc). There is Support at 105.00, the major poc. Next directional move will likely be signalled by a solid break from this range.
Dollar Index: earlier in the month probed above the March high but this was rejeceted. The minor 1/2R off that high is at 98.85. Dollar Bulls would want to see the index printing above that level.
Gold GLD: Still in a very weak price location. Closed on Wednesday a little above the five year low recorded earlier this month.
Oil: printed a new six year low on Monday and rallied but fell heavily on Wednesday back towards that low.
EURUSD: The rally from the November low approached but did not test the First Level Resistance at 1.1080, 1/2R off March low.
