posted 9.29 a.m. est
Pre-open comment Friday 27th May
I marked Aggressive Buying on Thursday auctioning ES up to test the 1327 major poc Resistance – if ES can print some time above this level it puts the chart in a much stronger price location. Price tested the 50day VAL earlier this week and Buyers were interested – this is encouraging for Bulls. The next band of Resistance and test for the Bulls is between the 35day poc at 1336 and 1338, the 1/2R off the May high.
Pre-open ES prints just slightly above the 1327 major poc and this could be intraday Support or Resistance today. ST direction may well be determined by seeing where ES prints relative to this level one hour after Open.
First Level S/R = 1327 (6month poc)
LT Sentiment:
AAII (public) poll Bulls% was down slightly to 25.6%, the lowest since August 2010. Bears% were up slightly to 41.4, the highest since September 2010. The 4wk ma of nett is at its lowest since September 2010.
Investors Intelligence (newsletters) poll, Bulls% was down to 43 which is the lowest since October 2010.
www.lipperusfundsflow.com reported net Equity Fund outflows at -$5.6 Billion for week to 25th May (inc. ETF activity). Last week also saw a large net outflow and the 4week flow is now -$5.8 Billion which is the largest 4week outflow since September 2010.
ST Sentiment: My version of the Rydex Assets Ratio was down again to 3.35 (from 3.61). The ratio reached 4.57 earlier this month which is the highest I have in my database.
Supporting Charts (+ or – or ? for equities).
+ EURUSD: 45day low on Monday was above the 1.3923 poc support (12month). Daily momentum (PriceOsc) turned up on Thursday.
? Dollar Index: Daily momentum (PriceOsc) turned down on Thursday.
– TLT: 5month high last week. Chart corrected but found support at the level of the December and March highs and is holding the Support trendline off the April low.
imo these charts are mixed and it is difficult to imply a ST bias for equities.
