posted 9.00 a.m. est
pre-open comment Thursday 20th December
Wednesday’s session generated an inside Value Area on less Volume. Significant Sellers were marked but this was Ineffective Selling (VA was overlapping) and it followed a day of Effective Buying so this could well be Buyers Resting. Even so new long trades are now eliminated for me at least until Significant Buyers are marked again. As you can see, both Significant Buyers and Sellers have been active over the last few days which indicates indecision in the market. This is frustrating the ST analysis but not surprising really considering the current situation. Currently ES appears to have stalled at the 6mn VAH at 1442 (dashed line; see previous comment) with First Level Support at the 3mn poc at 1413. If ES is to progress it may first need to consolidate and build enough time somewhere above 1406 to bring the maj poc higher and lift the VAH. Bearish indication in the longer timeframe would be Sellers marked below 1406.
First Level Support = 1413 (3mn poc).
Second Level Support = 1406 (maj poc)
Breadth. %Stocks>50dyma numbers: Nyse 71% and Nasdaq 63%. Numbers >50 are supportive.
Price location: Strong as long as major equity ETFs hold above their 1/2R levels which are: SPY 141.40; IWM 81.55; DIA 130.45; QQQ 65.95; XLK 29.48.
Sentiment: My version of the Rydex Assets Ratio was higher at 3.80 (from 3.47). This is a 30 day high. Bull fund assets that I follow increased 12% yesterday but they are still very low – still 30% down from their peak in September. The worrying aspect is the Bear fund assets which are currently as low as I have them in my database – this is tempered by the fact that total assets for the funds I follow are low.
Supporting Charts (+ or – or ? for equities). Momentum = daily PriceOsc
+ EURUSD: yesterday printed its highest level since April.
+ Dollar Index: currently printing below the 80.15 major level which is weak price location. Support at the 79.19 poc was probed yesterday.
+ TLT: Hit a 40day low on Wednesday.
imo these charts suggest a positive bias for equities.
