Technical analysis – Market pre-open 30th December 2015
Buyers were active on Tuesday and generated a higher Value Area. As long as ES holds above 2043.00 (1/2R) it is in a strong price location. Price around 2067 may attract time.
Dayframe: the minor (22day) poc is at 2052.00. Price relative to this level may be worth watching this week.
Resistance 2087.00 (5mn poc) to 2094.00 (maj poc)
First Level Support = 2043.00 (1/2R off November’s high, Mar contract)
Second Level Support = 1965.25 (1/R off this year’s high)
U.S. breadth numbers remain below 50, see below, but momentum (PriceOsc), although still negative for all four major stock index ETFs, is heading up.
Key Chart IWM: Resistance at 115.35 (maj poc). Chart closed just below this level on Tuesday.
Stocks>50dyma numbers: Nyse 44% (from 37%), Nasdaq 49% (from 42%), R2000 46% (from 39%). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio was higher at 9.17. This is a four month high and the first time the ratio has been above 9.0 since 18th August.
Supporting Charts:
Bonds IEF, the 7-10 yr ETF: last week found Resistance at 106.60 (18mn poc) and is lower from there. 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: A probe earlier in the month above the March high was rejected. 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: recently printed a new five year low. Still in a very weak price location.
Oil: printed a new six year low last week but rallied strongly from there. Up on Tuesday but futures indicate a lower open today.
EURUSD: The rally from the November low approached, but did not test, the First Level Resistance at 1.1080, 1/2R off March low.
