posted 9.20 a.m. est
Pre-open Thursday 24th December
The 30day poc moved higher to 1108 on Monday. Since then Value Areas have been narrow but have all printed above this level which is a sign of short term strength.
Supporting this view is my version of the Rydex Assets Ratio which fell from 2.16 to 1.58 on Wednesday due to a relatively large increase in Bear Fund assets.
Although the VIX and the ISEE index are indicating complacency (contrarian bearish) the Rydex Assets Ratio is a more reliable sentiment indicator for the near term.
I will not consider short positions until ES prints some value below 1108 which would be a first sign of weakness.
I would favour longs if SPX breaks above its Bear Market 1/2half level (1121.5) and holds. I’m also aware that every technical analyst on the planet is waiting for the same thing which could mean a very quick covering of shorts and a fast move higher or a big bear trap. Whether I mark Effective Buyers or Responsive Sellers will help decide that.
