Pre-open comment Monday 6th June
Last week I marked two instances of Significant Selling and no Significant Buying. Friday closed almost at the low for the week. The VA for the (short) week as a whole was wider/overlapping the previous week’s VA.
Breadth is not supportive. The Chartprofit Market Timing System remained negative for Nyse and Nasdaq and the %Stocks>50ma numbers for both Nyse and Nasdaq are below 30.
On both LT and ST timeframes there are indications of weakness.
Dayframe: I am anticipating further weakness. 1280 or just above is potentially a level where Buyers may Respond but Long trades are eliminated for me since Close on Wednesday.
First Level Resistance = 1314.50 (15dy poc)
Resistance = 1327 (6month poc)
ST Sentiment: My version of the Rydex Assets Ratio was down on Friday to 3.49 (from 3.56). The extreme high reading of this indicator was 4.57 recorded in early May.
Supporting Charts (+ or – or ? for equities).
+ EURUSD: Longframe, chart made low in May on major 1/2R support (from 2008 high). Daily momentum (PriceOsc) is up.
+ Dollar Index: Daily momentum (PriceOsc) is down. Last week’s price bar was a bearish reversal bar. Chart prints back below the 1/2R off May low at 74.53 – weak position.
– TLT: Chart reached a 25day high on Friday. Daily momentum (PriceOsc) is up.
imo these charts are mixed and it is currently difficult to imply a ST bias for equities.
