posted 9.19 a.m. est
pre-open comment Thursday 15th November
Wednesday generated a wider, lower Value Area on increased Volume. The last five Value Areas have been printed below the 1397poc and yesterday I marked Aggressive Selling for the second time below that level (80% of the time red-at-bottom lows are tested during the following session).
%Stocks>50dayma for both Nyse and Nadsaq are close to 20% and RSI(14) prints below 30 for all four major index ETFs. These are oversold readings (or close to) but as I wrote last week Sellers are active and in control and charts are in a very weak price location so I am not tempted to bottom fish.
Poc Support on the three Key Charts we have been monitoring since last week broke down early in yesterday’s session. I have been saying that “time spent below these levels would indicate further market weakness”. I continue to watch these – if charts recover back above these pocs then it would be a first minor sign of strength.
SPY 137.22 (12mn poc) – IWM 79.00 (maj poc) – XLK 28.16 (maj poc).
Sentiment: My version of the Rydex Ratio was almost unchanged at 3.30 which is higher than Monday’s ratio so I’m not seeing any sign of panic registered here yet (this is a contrarian indicator).
Supporting Charts (+ or – or ? for equities).
(Momentum = daily PriceOsc)
– EURUSD: Currently the chart is printing below 1.2777, the maj poc. This is weak price location although the high yesterday and again today is that poc. Would be an interesting move if EURUSD recovered back above that level.
– Dollar Index: Chart prints above 80.15, the most important level on this chart. Printed a two month high on Tuesday. This is strong price location.
– TLT: TLT currently prints above 123.96, the 9month poc, which is strong price location. Printed a two month high on Tuesday.
imo these charts have a negative bias for equities.
