pre-open comment Friday 23rd November
Wednesday generated a higher/narrower Value Area with a poc for the session at 1387 (see Wednesday’s pre-open comments). Pre-open ES has printed a 10dy high and is approaching First Level Resistance at the 1397 maj poc. Price above this level would be a sign of strength.
%Stocks>50dyma Nyse 37% and Nasdaq 29%. Numbers above 50 are supportive.
Second Level Resistance = 1404 (1/2R off Sep high)
First Level Resistance = 1397.00 maj poc
Key Charts/Levels: SPY 137.22; IWM 79.00. Both charts currently print above these levels. See also EURUSD and TLT (below).
Sentiment: My version of the Rydex Assets Ratio was slightly lower at 3.31 (from 3.40). Last Friday’s ratio at 2.57 was the lowest since since 7th June. Smart Bulls would not want to see a rapid increase in this indicator should the market rally further. AAII (public poll) reported Bulls% higher at 35.8% (from 28.8%) and Bears% lower at 40.8% (from 48.8%). Although there are still more bears than bulls this is a fairly large increase in public bullishness in this poll. Investor’s Intelligence poll did not reflect this with the nett (Bulls – Bears) at 9.5 being the lowest single reading since early June.
Supporting Charts (+ or – or ? for equities). Momentum = daily PriceOsc
+ EURUSD: Key Chart. Chart is currently printing above 1.2777, the major poc which is stronger price location. Has rallied and is today testing the 1/2R Resistance off Sep high at 1.2917.
? Dollar Index: Found Resistance last week at 81.35 (1/2R off this year’s high). Daily oscillators have been overbought and Momentum has turned down which suggests a test of the 80.15 Support is likely.
? TLT: Key Chart. Has reached the 9mn poc Suppoprt at 123.96. Time printed below that level would be a clearer postive for equities.
Encouraging signs for equities so far this week. More so if TLT breaks Support and EURUSD can print time above 1.2917.
