posted 09.10 a.m. est
Pre-open comment Monday 2nd December
ES: Last week I marked no Significant Buying or Selling. The last five Value Areas have been printed above the minor poc at 1789 and the first sign of ST weakness would be Effective Selling marked below this level. LT weakness would be indicated by Effective Selling being marked below the 1758.50 poc. Sentiment is pushing extreme levels of optimism (see eBook and Rydex data below) but Buyers are still in control of the dayframe – at least for now.
First Level ST Support = 1789.00 (17dy poc)
First Level LT Support = 1758.50 poc
Breadth: CP Marketing System stayed neutral for Nyse, stayed positive for Nasdaq and R2000 and stayed negative for UK.
Stocks>50dyma numbers: Nyse 66%, Nasdaq 68%, R2000 73%, UK 64%. Numbers >50 are considered supportive.
Sentiment: My version of the Rydex Assets Ratio ended the week at 5.43 almost equalling the high at 5.43 at the market May high. This indicator is registering extreme optimism which has historically been a warning for the market.
Supporting Charts
Bonds TLT: Recently probed down to probe the August low. Has bounced but still in a weak price location below 106.31, the 8mn poc. Momentum (although negative) is up.
Gold GLD: Nothing positive to say about this chart for months and it remains in a weak price location. Momentum (although negative) is up but if it turns lower I would look for another leg down for gold.
Oil USO: Consolidated for four weeks in a weak price location below 34.13, (3yr poc) and broke lower last week to its lowest level since June. Like GLD, a weak chart.
Dollar Index: The last four weeks have been spent back in a stronger price location above the important level at 80.15. Momentum (although positive) is down.
EURUSD: Strong LT price location above 1.3416 (1/2R off 2010 low) but weak ST location today below 1.3564, (minor 1/2R off October high).
