posted 8.56 a.m. et
pre-open comment Monday 16th April
Last week both Significant Buyers and Sellers were active trying to auction ES directionally away from the important 1366 poc. Neither were successful with ES closing the week very close to that level. Notice that neither Tuesday’s red-at-bottom extreme or Wednesday green-at-top extreme have yet been tested which is unusual. So far, Tuesday’s price action looks like a failed price probe below the poc and it is important to see where ES prints relative to 1336 at the start of this week. Time below that level would suggest further market weakness.
Weekly Structure: ES closed the week within Mon-Wed Hi-Lo Range which means the Weekly Structure had no bias.
Chartprofit Market Timing System: Nyse Market Chart turned negative; Nasdaq turned neutral; UK remained positive.
%Stocks>50dyma has broken down below 50% for these charts.
My best interpretation of the sentiment numbers suggests that we have a correction here at least but the latest AAII data was surprising, a high level of public bears emerged very quickly last week to a level that, historically, has been bullish from a contrarian viewpoint. Still, the Rydex data follows what the retail traders are doing rather than saying and they have far from capitulated. I’m very cautious here.
Second Level Resistance = 1386 (1/2R off March high)
First Level Support/Resistance = 1375 (10dy poc)
Second Level Support = 1366 (4month poc)
Sentiment: My version of the Rydex Assets Ratio finished the week at 4.48. No panic yet from the Rydex traders. Last week the ratio reached 5.64, the highest ratio in my database.
Supporting Charts (+ or – or ? for equities).
(Momentum = daily PriceOsc)
? EURUSD: Chart broke below the four month poc Support at 1.3069 today. Currently prints just below that level.
? Dollar Index: 80.15 is the most important level on this chart and today UDX is once again printing just below that level. Time printed above 80.15 would be bullish and imo negative for equities.
? TLT: today the chart is printing just above 116.22, the major poc, having rallied last week.
imo these charts do not have an obvious bias for equities. This could change soon.
st ratio in my database.
