pre-open comment Tuesday 8th January
Monday’s session generated another narrow Value Area within the range set since last week’s gap higher. No obvious Significant Selling Response has been marked since that point and ES is currently holding/accepting price at this higher level.
Dayframe: The minor poc of this four day range comes in at 1453. This may attract further time and could be used as an intraday guide to ST strength/weakness.
%Stocks>50dyma: Nyse 85% and Nasdaq 79%. Numbers >50 are supportive (>80 usually considered overbought).
First Level Support = 1413 (3mn poc)
Second Level Support = 1406 (maj poc)
Sentiment: my version of the Rydex Assets Ratio was sharply higher at 4.1 (from 3.22) a 55day high. VIX was down slightly at 13.70, very close to August’s extreme low which is a concern.
Supporting Charts (+ or – or ? for equities). Momentum = daily PriceOsc
Unlike Equity Index/ETF charts, the following KEY Charts are printing very close to useful reference levels. Monitoring price relative to these levels over the next few days will give us a very good idea about the markets current appetite for risk.
Bonds TLT: Up slightly off major poc Support at 117.15. Price printing below this level would indicate further weakness and be a positive for equities. Price holding this Support would most likely indicate equities will stall.
Oil USO: Has rallied to important 1/2R and poc Resistance. Price printing above this level would indicate further strength and “risk on”. Failure at this Resistance would most likely indicate equities will stall.
EURUSD: Chart indicated weakness late in the week by printing back below the 24mn poc. This is now Resistance in the ST. Price back above 1.3117 would be a positive for equities.
Dollar Index: Strength late in the week saw the Dollar Index back above 80.15 which is strong price location. Can that level now hold as Support? If so it would most likely indicate equities will stall.
