posted 08.50 a.m. est
Pre-open comment Monday 7th April
On Friday I marked Reactive Selling (red-at-top) and Aggressive Selling (red-at-bottom). New long trades are now eliminated for me, at least until new Significant Buying is marked. Negatives are building but there is LT Support at 1835.50 (6mn poc) – price printing below this level would be a further LT negative. See previous comments. The ST analysis looks weaker after Friday’s session. ES broke below 1872.50 (30dy poc), Breadth numbers deteriorated, and Price Momentum weakened. Monitoring the Key Supporting Charts which currently print very close to their important levels, see below.
First Level Resistance = ES 1872.50 (30dy poc)
First Level Support = ES 1835.50 (6mn poc)
Stock Index ETFs: Momentum (PriceOsc) for IWM and QQQ is negative and turned lower on Friday. Momentum for SPY and DIA remains positive and up. Small Caps and Tech sectors are clearly underperforming Large Cap now which is usually not a positive for the market.
Breadth: CP Market Timing System – Nyse turned back to positive (from negative). All other Major Market Charts remained negative.
Stocks>50dyma numbers: Nyse 68%, Nasdaq 44%, R2000 51%. Numbers >50 are considered supportive.
Sentiment: My version of the Rydex Assets Ratio ended the week at 6.73, a 23day low. The ratio reached 8.39 on 03/13 which is the highest ratio in my database. The Rydex traders are extremely bullish and historically this has been a warning for the market.
Supporting Charts (+ or – shown as implied bias for equities)
? KEY Chart Financial Sector XLF: pre-open is printing just above its maj 1/2R level (22.04).
+ KEY Chart EURJPY: chart is printing above 140.96, the 1/2R off Dec high.
? KEY Chart Bonds TLT: Last week tested, but held, the 2year poc Support at 107.24.
Dollar Index: printing above 79.76, the maj poc in a strong price location.
Gold GLD: printing below 127.20, the 18mn poc in a weak price location.
Oil USO: currently oscillating around 36.11, the 1/2R off Sep high.
EURUSD: Last week’s low, printed on Friday, was exactly at 1.3673, the 12mn poc Support. Momentum remains down and negative.
