posted 8.42 a.m. est
Pre-open comment Monday 18th April
Chartprofit Market Timing system is negative for all major Market Charts except Russell2000 which is now neutral.
Last week I marked two instances of Significant Buying and two of Significant Selling. Friday closed well above the Mon_Wed range low and Weekly Structure showed no directional bias although the Value Area for the week was lower and wider than the previous week.
The Responsive Buying on Thursday followed by Aggressive Buying on Friday auctioned ES back to test the obvious Resistance at 1317.50 (dotted) which is the 1/2R off April high. This has so far been rejected. Consolidation above that level would be the first sign of ST strength this week.
The most recent imbalance was Buying (green) and therefore Short Trades are eliminated for me at the start of this week. However with the CP Market Timing system being mostly negative the LT and ST indications are mixed. If Significant Selling is marked early in the week it would put both timeframes in the negative camp and time spent below 1308.50 (2month poc) would therefore be a clear indication of further weakness.
First Level S/R = 1308.50 (2month poc)
Resistance = 1328.50 (poc)
Support between 1289.50 1/2R off February high and 1293 (poc)
LT Sentiment: VIX close on Friday at 15.32 was the lowest since July 2007. Indicates extreme complacency.
ST Sentiment: My version of the Rydex Assets Ratio reached 3.99 on Thursday 7th April. That’s the highest I have in my database. Since then the ratio has fallen back to around 2.9.
Supporting Charts (+ or – or ? for equities).
? EURUSD: Last week EURUSD printed the highest level since January 2010. Today though chart is testing the support trendline off the January low.
? UDX: Last week Dollar index printed the lowest level since December 2009. Today though chart is printing a six day high.
– TLT: Chart currently prints back above the 18month poc at 91.82. Consolidation here would put the chart in a much stronger price location.
imo although these charts are mixed in the ST the bias for equities is most likely positive.
