posted 9.17 a.m. et
Pre-open comment Friday 11th November
I gave 1st Level Support yesterday as 1224 (this has migrated) and the day session low came in at 1224.50. In the ST it’s encouraging when 1st Level Support holds. I also gave 1st Level resistance as 1249 which was approached overnight and has been probed pre-open.
Dayframe: On Thursday the 35dy poc migrated higher to 1244. This is close to the 1/2R off May high at 1249. Where ES prints relative to that band of S/R should give clues re ST direction. i.e. time above 1249 indicates ST strength and time below indicates ST weakness.
1st Level S/R = 1249 (min 1/2R) (125.46 SPY)
Support = 1244 (35dy poc) (124.35 SPY)
Sentiment: AAII (public poll) Bulls were reported at 44.7% which is the highest reading since w/e 18th Feb. The nett (Bulls-Bears) is 20.1 and is also the highest since that date. Bears came in at 24.6%; the lowest number since w/e 14th Jan. It’s certainly the case that much of this optimism was polled before Wednesday’s big down day and some of the enthusiasm may have already been knocked out but the fact remains that public bullishness reached an eight month high this week.
ST Sentiment: My version of the Rydex Assets Ratio was down to 2.70. Monday’s ratio at 2.96 was a 65dy high.
Supporting Charts (+ or – or ? for equities).
? EURUSD: On wednesday broke below the 1.3635 poc putting it in a very weak price location but has recovered today to print just above that poc. Where this chart finds itself relative to that major poc over the next few days is critical to this analysis. Momentum down for nine days.
– Dollar Index: prints above the major level at 76.27 (1/2R off the May low) and above the 77.05 min poc. Momentum up for nine days.
? TLT: above the 5mnth poc at 114.56 but below the minor 1/2R off Oct high at 117.42. Momentum up for nine days.
imo these charts will align themselves positively or negatively for equities very soon. This will give a clear implication for the markets.
