posted 08.16 a.m. est
pre-open comment Tuesday 15th October
Monday’s low came early in the session at exactly the 1685.50 poc with Buyers Responding (green-at-bottom). Aggressive Buying (green-at-top) was marked later in the day. In the last seven sessions I have marked Significant Buying six times and Significant Selling once. Since the September high ES sold off to probe the 1653.50 poc which was rejected as Buyers Responded below that level (see chart) and auctioned ES back above the 1685.50 poc. As long as ES holds above 1685.50 it is in a strong price location. The dashed line at 1702.50 is the VAH of the distribution that began early July. If this level does not stall the chart it suggests, imo, that a new bullish distribution has begun. Breadth numbers improved again (see below) and there is a relative lack of excitement from the retail Rydex traders (see below) which is not a bearish indication.
First Level Support = 1685.50 poc
Second Level Support = 1653.50 poc
Stocks>50dyma numbers: Nyse 74%, Nasdaq 70%, R2000 72%. Numbers >50 are considered supportive.
Sentiment: My version of the Rydex Assets Ratio was unchanged at 4.0. The ratio reached as high as 5.43 at the market May high and as low as 2.15 on 07/10 (which was the lowest ratio since January 2012).
Supporting Charts
Bonds TLT: The local poc migrated lower to 106.34 last week and is now Resistance for this chart which is currently printing below that level and printed a 17day low on Monday. Momentum (although postive) is down.
Oil USO: Closed Friday below 37.31, the low of the Support/Resistance band in a weak price location. I’m not interested in considering the long side of this chart until price can print time above 37.93, the maj poc.
Gold GLD: Pre-open today has printed a new 3month low and remains below 134.17, the 12mn poc, in a weak price location.
Dollar Index: Is printing back above the important level at 80.15 (major 1/2R and poc) at a 19day high today. Dollar Bulls would want to see price holding above this level. Momentum is now positive and up.
EURUSD: On 3rd Oct printed its highest level since February but Momentum (although postive) is down.
