posted 08.00 a.m. est
pre-open comment Friday 7th June
By strictly applying my rules I had to mark Aggressive Buying (green-at-top) on Thursday. The Value Area was overlapping/lower so this is not Effective Buying. As I wrote yesterday “I need to see (at a minimum) Effective Buying above 1626 before considering new long trades”. The session high approached the 1626 poc but has not yet printed any time above that level. Bulls would hope that happens quickly.
%Stocks>50dyma numbers: Nyse 54%, Nasdaq 63%, R2000 65%. Numbers >50 are considered supportive. Numbers >80 are considered overbought.
Potential Support/Resistance today = ES 1626 (prev poc)
Sentiment: my version of the Rydex Assets Ratio was higher at 4.79 (from 4.62). When looking for a price low it is usually supportive if the Rydex traders register some fear. They haven’t done that since the market started this sell-off eleven days ago. Bearish sentiment increased in the Investors Intelligence and AAII polls but nothing surprising or contrarian bullish imo. There was a big fall in the NAAIM number though. The average current eauity exposure among active money managers was sharply lower at 51.58%. That’s down from 77.19% and the largest fall in a single week since late May exactly one year ago.
Supporting Charts
Bonds TLT: KEY CHART. printing below the major poc at 117.15. Time printed below this level is weak price location. Last week chart reached its lowest level since April 2012.
Oil USO: Currently printing below the Resistance around 34.20 which is weak price location. Momentum (although negative) has turned up.
Gold GLD: Fell steeply in April to its lowest level for two years and that level was approached again in May. Momentum, although negative, is up.
Silver SLV: Recently printed its lowest level since October 2010.
Dollar Index: Fell sharply to Support at the 1/2R off 2009 high at 81.10. Momentum has been heading lower but has now turned negative.
EURUSD: In May chart found Support just above the major poc at 1.2777 and this week overcame potential Resistance at 1.3070, the 24mn poc. Is currently printing at its highest level since February. Momentum is up and positive.
