Pre-open comment Wednesday 12th October
Tuesday tested Monday’s green-at-top high and Sellers have not Responded so far. ES is currently printing above the 2month VAH and almost registering overbought by my criteria – ie 14day RSI above its 40period Upper Bollinger Band. Nevertheless if chart manages to print above the 1/2R Resistance at 1214.50 over the next few days it will be back in a strong price location.
Breadth: %Stocks>50dyma. This indicator starts to look bullish when it gets above 50. As of Tuesday’s Close both Nyse and Nasdaq numbers are in low 40s.
1st Level Support = 1189 (min poc) (SPY 118.95)
2nd Level Support = 1158 40dypoc (SPY 114.85 4mnthpoc)
1st Level Resistance = 1214.50 1/2R off May high (SPY 122.30)
ST Sentiment: My version of the Rydex Assets Ratio was almost unchanged at 1.54.
Supporting Charts (+ or – or ? for equities).
? EURUSD: Broke Major Support in early September but has recovered back above 1.3416 (1/2R Support off June 2010 low). Momentum (PriceOsc) has been higher for twelve consecutive days.
? Dollar Index: Last week printed its highest level since January but momentum (PriceOsc) has been lower for eleven consecutive days.
? TLT: Last week printed a new high testing again the old high from December 2008. Currently printing back below that level and daily momentum has turned down.
imo these charts have a negative bias for equities in the LT but positive in the ST.
