Pre-open Thursday 22nd April
Very interesting session on Wednesday. The low was exactly on yesterday’s First Level S/R at 1195 (dotted). However, during the session the minor poc (10day) migrated higher to 1204 and overnight ES has rallied back to test that level and found resistance. Since then ES has fallen back below 1195. This is the first sign of minor dayframe weakness for a while.
First Level Resistance is now 1204
First Level Support is 1195
Second Level Support is 1183.50
First real test for the Sellers would come at 1183.50 if weekness plays out.
Considering the ST Sentiment (see below) and Supporting Charts (see below) it would not be surprising to see some weakness here.
ST Sentiment:
The ISEE (equity only) index came in high yet again at 236. Fifteen out of the last seventeen days have been above 200 for this index indicating that the public are very bullish – usually a warning that the market is overheated (contrarian).
Rydex Bull Fund assets that I follow were up 12% on Wednesday lifting my version of the Rydex assets Ratio back above 3 which is very high historically. Rydex Money Market assets (Inv. class) reached the lowest level for years. The Rydex timers are very bullish.
VIX closed at 16.3 and reached an intraday low of 15.5. This is very low and indicates extreme complacency.
Supporting Charts with important levels:
USDJPY prints below 1/2 level at 93.60.
EURUSD prints below poc at 1.360.
UDX prints above support band 80.15-80.30.
IEF prints at a 20day high. Momentum is up but there is resistance above at 90.50.
imo these charts do not support higher equities.
