posted 7.45 a.m. et
pre-open comment Friday 13th April
Both levels given pre-open yesterday provide Support and Resistance. The session low came in almost immediately after the Open as the 1366 poc (given) was tested and rejected. Subsequently, Aggressive Buying was marked as ES rallied to test the First Level Resistance at 1386 (given). Time above that 1/2R level would indicate higher.
A poc migrating higher and then providing obvious Support is a bullish pattern I have talked about many times and this level has now proved its significance in my view. Henceforth if that level is broken I would expect sharply lower prices but ES finding Support at 1366 yesterday is encouraging. The last imbalance on this timeframe is now Buying and that means new Shorts are eliminated for me until Significant Selling is marked again.
First Level Resistance = 1386 (1/2R off March high)
First Level Support = 1375 (10dy poc)
Second Level Support = 1366 (4month poc)
Sentiment: My version of the Rydex Assets Ratio was slightly higher at 4.90 (from 4.74). No panic yet from the Rydex traders. Last week the ratio reached 5.64, the highest ratio in my database. AAII (public) poll reported that Bulls fell to 28.1%, the lowest number since w/e 23rd September last year. Bears were up to 41.6% (from 27.8%) and that is the highest level of Bears since w/e 7th October (a chart low). The change in Bears is +13.8 and I only see nine weekly changes larger than that looking back over four years. The nett at -13.5 is the lowest since w/e 30th September last year and the change in the nett is -23.9 which again, if I look back four years, I only see ten larger negative changes. This is quite a dramatic change in sentiment and from a contrarian viewpoint is bullish.
Supporting Charts (+ or – or ? for equities).
(Momentum = daily PriceOsc)
? EURUSD: Chart fell last week to the four month poc Support at 1.3069. Has so far held that Support.
? Dollar Index: 80.15 is the most important level on this chart and last week UDX rallied to this Resistance and has so far not broken above it.
? TLT: yesterday the chart tested above 116.22, the major poc. Currently prints just below that level.
imo these charts do not have an obvious bias for equities. This could change soon.
