posted 9.28 a.m. est
Pre-open Thursday 7th July
All of Wednesday’s session took place above the First Level S/R at 1023 (5day poc). Aggressive Buyers (green-at-top) auctioned ES higher and pre-open ES has printed as high as 1066. Strictly applying my own rules yesterday’s Buying was not Effective (higher but narrower Vaule Area) however my #1 rule is “never fade the last imbalance” and that was Buying so Short trades are now eliminated for me until Significant Sellers are marked again.
First Level Resistance is 1073 (poc). If ES can consolidate above that level then I would expect continuation higher.
First Level Support = 1023 (minor poc)
LT Sentiment: Investors Intelligence (newsletters) Bears were higher again this week at 34.8% (was 33.3%). That’s the highest %Bears in this poll since July 2009.
ST Sentiment: My version of the Rydex Assets Ratio was almost unchanged at 0.85 (the lowest level since July 2009) on a very good day for the market. That’s usually bullish i.e. it suggests lots of retail Bears who will likely cover if the market pushes higher. However, the ISEE (equity only) Index came in at 247 which is the highest day’s reading since April 14th (when that cazy, unheard of number of 348 was reported) and shows a relatively high number of Calls being bought compared to Puts.
Supporting Charts (technicals based on daily Price Oscillator)
? USDJPY: new low for the year last week but currently printing above the three previous days highs. Could be turning.
+ EURUSD: higher low based on the 1.2133 major halfway level was confirmed by a breakout above the June high. Printed a new 8wk high today.
+ UDX: below the 85.14 poc support and printed a new 8wk low today.
? TLT. Pre-open is testing the potential support which is the May high.
imo: these charts are mixed but improving for equities.
