Technical Analysis – Market pre-open 4th January 2016
Last week I marked Significant Buying once (Tuesday) and Significant Selling twice, later in the week. We have been monitoring the minor (23day) poc at 2052 (see previous comments) and on Thursday an early probe up into this level was rejected with the Value Area generated entirely below that price. As of one hour pre-open today ES is sharply lower and has printed below 2000.
Second Level Resistance 2087.00 (5mn poc) to 2094.00 (maj poc)
First Level Resistance = 2043.00 (1/2R off November’s high, Mar contract)
Support = 1965.25 (1/R off this year’s high)
U.S. breadth numbers remain below 50, see below. Another negative was Key Chart IWM, where the Resistance at 115.35 (maj poc) was the exact high last week.
Market Charts: Nyse & R2000 turnd negative, Nasdaq remained positive, UK remained neutral.
Stocks>50dyma numbers: Nyse 30%, Nasdaq 37%, R2000 31%, UK 60%. Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio ended the week at 8.12. Last Tuesday’s ratio at 9.17 was 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: recently 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. Futures indicate a higher open today.
Dollar Index: A probe in earkly December 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 on 12/21 but has bounced from there.
EURUSD: The rally from the November low approached, but did not test, the First Level Resistance at 1.1080, 1/2R off March low.
