Technical analysis – Market pre-open 13th January 2016
See previous comments. Pre-open yesterday I wrote re recent price action “whenever Sellers are active intraday they are effectively generating lower Value Areas”. During yesterday’s session Sellers were active intraday, see highlighted numbers, but a higher/overlapping Value Area was generated which means they were Ineffective in the dayframe. Some sign of Effective Buying activity would be a positive. In terms of price location recovery back above 1965.25 would be the first sign of strength.
Second Level Resistance = 2043.00 (1/2R off November’s high, Mar contract)
First Level Resistance = 1965.25 (1/R off last year’s high)
Key Chart DIA: Key Chart DIA has tested but so far, not broken the Support at 64.00. But Price momentum (PriceOsc) for all four major stock index ETFs remains negative and down.
Stocks>50dyma numbers: Nyse 13% (from 14%), Nasdaq 13% (from 12%), R2000 12% (unch). Numbers >50 are supportive.
Sentiment: See Tuesday’s comments re the Rydex Assets Ratio. My version of the Ratio was almost unchanged at 5.70. This is now down 37% from the four month high reached on 12/29. Some fear has been registered.
Supporting Charts:
Bonds IEF, the 7-10 yr ETF: Held the major Support at 105.00 following October’s decline and rallied. Now printing time above 106.60 (18mn poc) in a stronger price location.
Dollar Index: A probe in early December above the March high was rejected. The minor 1/2R off that high is at 98.85 and the index is printing just above that level today.
Gold GLD: printed a 44day high last week as investors sought safe haven. Chart is still in a LT weak price location though.
Oil: lower again on Tuesday – at its lowest level since 2004.
EURUSD: The rally from the November low approached, but did not test, the First Level Resistance at 1.1080, 1/2R off March low.
