pre-open comment Friday 25th May
You can see on the chart that currently ES is oscillating around the 1307poc which is almost in the middle of this week’s range. On Thursday ES printed an entire Value Area above 1307 (as it did on Tuesday) which is ST encouraging but first sign of ST strength would be Significant Buying marked above that level. see Thursday’s comments highlighted.
Dayframe: The 15dy poc is at 1314.50. This level could be intraday Support or Resistance and may provide a clue re whether ES finishes the week relatively strong or weak.
First Level Support = 1314.50 (15dy poc)
Second Level Support = 1307 (maj poc)
Sentiment: The AAII (public) poll reported Bulls at 30.5% (up from 23.6% previous week which was the lowest Bulls% since w/e 27th Aug 2010). Bears came in at 38.7% (down from 46% previous week which was the highest Bears% since w/e 30th Sept 2011. Because the previous week’s numbers showed such a high level of bearishness I don’t think this week’s decrease in pessimism can be seen as contrarian bearish.
My version of the Rydex Assets Ratio was lower again on Thursday to 3.10 (from3.28). This is a 50dy low but still higher than I would expect to see at an intermediate bottom. Ratio reached a low of 3.07 on 03/13.
Supporting Charts (+ or – or ? for equities).
(Momentum = daily PriceOsc)
– EURUSD: Major poc is at 1.2777. Chart currently prints below that level and at its lowest since July 2010.
– Dollar Index: Has today printed its highest level since September 2010.
– TLT: On Wednesday printed its highest level since October. Chart very overbought technically.
imo these charts have a negative bias for equities.
