posted 9.29 a.m. est
Pre-open Wednesday 28th July
In the webcast this week I showed the three month price distribution chart for ES. The Value Area Low came in at 1052 and the Value Area High came in at 1114. Obviously the range of the Value Area changes over time but currently ES is probing the VAH. Sometimes a probe above an important VAH will be rejected and mark a top of some degree and that is a possibilty – we have price resistance here (SPY 1/2R from April high) and time resistance (91 days from April high). However if ES builds value here (time spent) that would alter the VAH over time and be a bullish indication. Effective Selling marked below 1108 would be a clue that the former scenario is correct.
First Level S/R is 1108. This is the minor poc over last few days and is also the 1/2R off the April high. An important level. Obvious intraday support or resistance at this level may well indicate ST price direction but it may also be a sticky level and attract time. imo that would be bullish (see above).
ST Sentiment: My version of the Rydex Assets Ratio rose on Tuesday to 1.43 (up from 1.06). There is nothing bearish about that. The Rydex timers are very being slow to embrace the rally off the July low.
Supporting Charts (technicals based on daily Price Oscillator)
? USDJPY: This chart continues to struggle but Price Osc was again higher.
+ EURUSD: New 11wk high this week.
? UDX: tested down into the 81.87 support. If UDX breaks below this level it is in a weak price location.
? IEF: the chart has a pattern of higher highs and higher lows and this is still intact although the support trendline from the April low is being tested and Price Osc is falling.
imo these Charts are mixed. Their influence for equities is uncertain.
