posted 7.a.m. ET
Pre-open comment Friday 23rd September
Note: this was written at 7am ET
The analysis on both timeframes looks very negative. If the Major Support levels are broken (see below) then the market could accelerate lower.
Financial Sector (XLF) is another key chart. Level to watch is 11.54 which is the maj1/2R off 2009 low. There is possibility of Support here but an indication of general weakness would be this chart printing below this level.
1st Level Resistance ES = 1142 (minor poc) to 1147 (1/2R off Aug low)
Major Support ES = 1094 (Maj Poc)
1st Level Resistance SPY = 114.87 (3mnth poc)
Major Support SPY = 112.31 (maj 1/2R) & lower at 109.17 (Maj Poc)
LT Sentiment: AAII (public) poll reported Bulls at 25.3% which is the lowest for fifteen weeks and Bears 48%, the highest for seven weeks. The nett at -22.7 is back where it was early August.
ST Sentiment: My version of the Rydex Assets Ratio was up slightly at 1.54 (from 1.52). This is not a sign of panic with the market down hard. Not bullish in ST (contrarian).
Supporting Charts (+ or – or ? for equities).
– EURUSD: Broke Major Support, as detailed, earlier this month. Next level of potential Support is the 1/2R off June 2010 low which comes in at 1.3416. Chart has reached that Support.
– Dollar Index: Chart printed a seven month high on Thursday.
– TLT: on Thursday the Chart exceeded the Dec 2008 high.
imo these charts have lined up negatively for equities.
