posted 8.10 a.m. est
Pre-open Tuesday 9th February
Monday’s Value Area was overlapping/higher but narrower than Friday’s and generated less volume. Overnight ES printed as high as 1067 which is 3dayHVA (high of the summated Value Area for last three days). That’s not much of a performance from the Buyers (who have only been marked once in the last fourteen trading days).
As I mentioned yesterday the major poc could migrate lower and this would change things. Most likely level would be around 1064 and if that happens we would assess potential strength/weakness with regard to whether price prints above or below that level.
On Monday my version of the Rydex Assets ratio fell from 1.56 to 1.31. Rydex Bear fund assets I follow were up slightly (+5%) and Bull fund assets were down 13% to their lowest level since July. This improves the chances for a rally here (contrarian) but currently I’m not interested in the long side, even short term, until Effective Buying is marked.
Dayframe: Overnight ES consolidated on 1054.5 – the 1/2R off Friday’s low – that’s a first minor sign of strength. If price can hold above the 3daypoc at 1061 (First Level S/R) early in the session then we could see a rally today to relieve some of the oversold condition. The more time spent today below 1061, the more likely we’ll see a test of Friday’s low.
