Technical analysis – Market pre-open 19th May 2016
See previous highlighted comments. Both Significant Buyers and Sellers have been active over the last few days without either gaining control of the dayframe. Most important is price relative to the poc at 2041 and 30 minutes pre-open today ES is printing below that level. If ES stays below 2041 post-open it is in a weakened price location and would suggest lower. This level could be intraday Support or Resistance today. Breadth numbers have deteriorated over last few days and are below 50 see below.
Resistance = 2068.00 dashed line (minor 1/2R off April high)
First Level Support/Resistance = 2041.00 (8mn poc)
KEY Chart: The 1/2R off last years high for IWM is at 111.38. Chart closed below that level on Wednesday in a weak price location.
Stocks>50dyma numbers: Nyse 45% (from 48%), Nasdaq 41% (from 38%), R2000 44% (from 42%). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio was lower at 3.94. On 04/26 the ratio reached 5.27 which was the highest level since early January. On 02/19 the ratio fell to 2.64 which was the lowest since November 2012.
Supporting Charts:
Bonds: TLT. was sharply lower on Wednesday and broke below 130.77, the 8mn poc which puts it in a weaker price location.
Dollar Index: Now printing back above 94.79, the 2yr poc, in a stronger price location.
Gold: GLD – With the dollar rallying Gold has declined this week but as long as GLD holds above the major poc at 118.22 it is in a strong LT price location.
Oil: USO – on Tuesday printed its highest level since December. Closed lower on Wednesday and futures indicate a lower open today.
EURUSD: pre-open today charting is testing just below 1.1198, the 3yr poc. Time below this level would indicate further weakness.
