Pre-open Tuesday 9th February
See previous comments. Monday generated a lower Value Area, printed entirely below the 1870 poc. This is weak price location. There was a late rally but overnight ES has given back more than half the gains it made off yesterday’s low.
Staying cautious here especially with price Momentum and breadth remaining weak.
First Level Resistance = ES 1870 (previous maj poc)
Last week Key Chart DIA probed 63.75, its major poc but has yet to print any time above that level.
Stocks>50dyma numbers: Nyse 23% (from 26%), Nasdaq 15% (from 17%), R2000 16% (unch). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio was lower at 3.39 which is as low as it has been for two years except for the sell-off late last year when the ratio fell to 3.00.
Supporting Charts:
Bonds IEF, the 7-10 yr ETF: Held the major Support at 105.00 following October’s decline and has rallied strongly to a new high.
Dollar Index: A probe in early December above the March high was rejected and the chart is currently printing its lowest level since then.
Gold: benefiting from the risk-off tone and weaker dollar and has printed its highest level since June.
Oil: rallied strongly off the low in January but is currently printing back below the 1/2R off that low in a weak price location once again. Equity Bulls would want to see oil printing above that level.
EURUSD: is today probing above the Major 1/2R Resistance at 1.1241. in a stronger price location.
