Pre-open Thursday 2nd July
Wednesday generated a higher, but unconvincing, Value Area. ES has stalled just above the potentail Support at 2045.00, but as I wrote on Tuesday, as a “previous” poc we can’t be sure how valid it is. In any case I need to see Significant Buying marked 2095.00, which is the 10mn poc, before considering new longs. In the ST ES is printing time around 2074.00. I do not want to see too much time printed here; if the 10mn poc were to migrate to this level I believe it would be a negative development.
Bulls would want to see breadth numbers improving, see below.
Second Level Resistance = 2107.00
First Level Resistance = 2095.00
Possible Support at 2045.00 (prev poc)
Stock Index ETFs: Momentum is negative and down for SPY, DIA, QQQ and positive but down for IWM. Also see current price relative to poc levels in Monday’s eBook. SPY, QQQ, and DIA closed weak below their local pocs. Key chart could be IWM and its price relative to 124.50, the 7mn poc which has so far held as Support in this decline.
Stocks>50dyma numbers: Nyse 33% (from 29%), Nasdaq 46% (unchanged), R2000 47% (from 46%). Numbers >50 are supportive.
Sentiment:My version of the Rydex Assets Ratio was slightly higher at 10.91. The ratio is almost unchanged this week. Note that seven days ago the ratio fell to 8.78 which was a seven month low.
Supporting Charts:
Bonds TLT: closed on Tuesday below 117.14, the maj poc in a weak price location. Futures indicate that TLT will open lower today.
Dollar Index: found Support earlier in the week at 94.67, the 12mn poc and is printing a 18day high today.
Gold GLD: in May a probe into the Resistance at 117.60, the 1/2R off the November low, was rejected. Price above this level would be first sign of LT strength. GLD remains in a weak location.
Oil USO: the 16mn poc recently migrated to 20.24. USO closed below that level on Wednesday and at its lowest level since mid-April.
EURUSD: is today printing below 1.1340, the 12mn poc
