Pre-open Monday 19th July
You can see from the chart that last week ES attempted three probes into the 1094 Major Poc all of which were were rejected. Following that third rejection Sellers were marked on Friday aggressively auctioning ES lower – quite likely to probe the low of the 3month Value Area around 1050 which is a good reference level as 1051 is the 1/2R off the July low. Potential support here.
Long positions are eliminated for me – the CP Market Timing system stayed negative (red) for the eleventh consecutive week. And Long trades also eliminated for now as the most recent imbalance was Selling.
Sentiment: My version of the Rydex Assets Ratio was down on Friday from 1.2 to 1.14. If the selling late last week extends into this week I would anticipate Bears pushing the Sentiment measures back down to the extreme low readings we saw at the start of the month.
Supporting Charts (technicals based on daily Price Oscillator)
– USDJPY: chart hit a new low for the year on Friday.
+ EURUSD: charges on – new 9wk high on Friday. ST getting overbought though.
+ UDX: Printed a new 10wk low on Friday. ST oversold and potential support at 81.87 holding for now.
– IEF uptrend still intact. Earlt last week the daily chart bounced of the support trendline from April low.
imo Charts are mixed for equities but if dollar index finds support and EURUSD stalls with the OB situation the market could struggle.
