posted 9.29 a.m. ET
Pre-open comment Tuesday 18th October
Aggressive Selling (red-at-bottom) was marked on Monday. Overnight the 4month poc at 1189 has been tested. Pre-open today ES has printed as high as 1198.50 (Monday’s poc = 1199).
Dayframe: The majority of the time a red-at-bottom low is tested during the following session so 1194 will most likely be tested post-open today. If price approaches 1189 Buyers may well Respond especially if this occurs within the first hour of the session. If time is spent below 1189 beyond the first hour then ES will probably see further weakness. Effective Selling marked below 1189 would suggest more than a correction here. Price above 1214.50 would indicate higher. Long Trades are eliminated for me until I mark further Buying (green).
1st Level Resistance = 1214.50 1/2R off May high (SPY 122.30)
1st Level Support = 1189 (4month poc) (SPY 119.44=40dypoc)
ST Sentiment: My version of the Rydex Assets Ratio was higher at 1.79 wich is a 44dy high. Bull Fund assets that I follow hit a 50dy high. Although these numbers indicate that Bulls are slowly emerging they are nowhere near any kind of extreme that might have contrarian bearish implications.
Supporting Charts (+ or – or ? for equities).
? EURUSD: Momentum (PriceOsc) has been higher for sixteen consecutive days and on Monday printed as high as 1.3905 – just below 1.3965, the major 1/2R off 2008 high.
? Dollar Index: Chart has printed a four day high today having possibly found Support just above 76.27, the 1/2R Support off the May low. Looking for Momentum to turn up and confirm (momentum has been lower for fifteen consecutive days).
? TLT: Momentum has been lower for eight consecutive days but chart is oversold (14dy RSY < 40LBB)
imo these charts have a negative bias for equities in the LT but unclear in the ST.
