emini futures 7th December 2018 – pre-open from Chartprofit
Pre-open on Monday there was a rejected probe above 2808, the 12mn VAH. On Tuesday there was a large sell-off which saw ES back below 2718, the major poc. Early in Thursday’s session there was a sharp decline and another rejected test of 2634, the 12mn VAL.
Since mid-October, price action has been limited by the 12mn VAL (three times) and by the 12mn VAL (twice) with the maj poc (2718) sitting almost in the middle of that range. This suggests that a large distribution, of which 2718 is the controlling price, is still current and developing. But this will change at some point and a new distribution will begin. In which direction? In the longer term it is my assumption that price acceptance at 2808 (VAH) would be a bullish indication and price acceptance at 2634 would be a bearish indication. The odds of one or the other scenarios being the most likely, in my view, depend on where ES is printing relative to that controlling price at 2718. Currently, ES has not recovered back above that level and Bulls would want to see that happen as soon as possible.
ETFs Maj POC levels: SPY 271.7, IWM 153.5
Stocks>50dyma numbers as of Tuesday close: Nyse 32% (from 33%), Nasdaq 29% (from 28%), R2000 28% (from 27%). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio was slightly lower at 14.34. The market was sharply lower on Tuesday and although Thursday ended the day almost flat it was down hard early on – despite this the Rydex Ratio has not fallen very much this week. On 11/05 the ratio fell to 8.15 which was the lowest ratio in more than a year. The peak reading is 27.55 recorded 09/07 which equalled the highest ratio in the database.
