pre-open comment Friday 13th July
On Thursday ES opened lower and spent most of the session working higher to probe up into yesterday’s First Level Resistance at 1334.50. Even so the Value Area generated was overlapping/lower so this was not Effective Buying. Possibly Sellers Resting. As the most recent imbalance was Significant Selling marked (on Tuesday) I need to see Effective Buying marked before considering the long side, and preferably above 1334.50 1/2R.
First Level S/R = 1334.50 (1/2R off March high)
First Level Resistance SPY = 134.67
Support = 1315 (1/2R off June low) SPY = 132.46
Sentiment: from pre-open Thursday “Recently the Sentiment measures were hitting two month extremes of optimism and hopefully this decline will dissipate that enthusiasm quickly”. My version of the Rydex Assets Ratio was actually higher on Thursday at 4.28. Tuesday’s ratio at 4.40 was a 37day high. If we are looking for a sign of panic it is not to be found here. Rydex traders seem fairly complacent about this week’s sell-off.
Supporting Charts (+ or – or ? for equities).
(Momentum = daily PriceOsc)
– EURUSD: New low again on Thursday.
– Dollar Index: two year high printed on Thursday.
– TLT: chart now prints in a strong price location above the Minor 1/2R off June high at 127.23 27dy high printed on Thursday.
imo charts imply a negative bias for equities.
