Technical analysis – Market pre-open 19th February 2016
See previous comments. ES stalled on Thursday, generating a narrow, overlapping Value Area. However, this is the third Value Area printed entirely above the 1870 poc and as long as ES holds that important Support it is in a stronger price location than earlier this month.
First Level Support = ES 1886.50 (3mn poc)
Second Level Support (prev major poc) = ES 1870 (previous maj poc)
Stocks>50dyma numbers at end of last week: Nyse 43% (unch), Nasdaq 31% (unch), R2000 32% (from 33%). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio fell on Thursday to 2.72 which is the lowest since July 2013. The rydex traders have taken the rally as an opportunity to sell. On 12/29 the ratio reached 9.17.
Supporting Charts:
Bonds IEF, the 7-10 yr ETF: Held the major Support at 105.00 following October’s decline and rallied strongly. On Thursday last week the chart spiked to a new high but has declined from there.
Dollar Index: found Support last week at 95.22, the 12mn poc. Higher from there and Bulls would want to see that level hold.
Gold: GLD has rallied strongly and now prints above 115.12, the 24mn poc, which is now Support.
Oil: is printing just below the 1/2R off the January low. Bulls would want to see oil printing above this level.
EURUSD: last week probed above 1.1241, the Major 1/2R, but is off that level. First Level Support is at 1.1085, the 1/2R off last year’s low.
