Technical analysis – Market pre-open 10th December 2015
Sellers were active on Wednesday and more effective than the Buyers on Tuesday, generating a lower, wider Value Area. Significant Selling (red) was marked. ES broke below 2054.50 (1/2R off the November high) and pre-open today is printing below that level in a weak price location.
Key Charts: IWM (R2000 ETF) – closed below 115.35, the Major poc, in a weak price location.
Second Level Resistance 2087.00 (5mn poc) to 2094.00 (maj poc)
First Level Resistance = 2054.50 (1/2R off the November high)
Breadth deteriorated again, see below.
Stocks>50dyma numbers: Nyse 34% (from 40%), Nasdaq 42% (from 49%), R2000 40% (from 46%). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio was almost unchanged at 8.48. Last week the ratio reached 9.00 which was a 70day high.
Supporting Charts:
Bonds IEF, the 7-10 yr ETF: probed the Resistance at 106.60 (18mn poc) last week. This was rejected but the chart has held the 105.00 (major poc) Support and is up from there. Price below that level would be weak price location.
Dollar Index: last week printed its highest level since the March high but sharply lower on Thusday following the ECB announcement. Momentum is negative and down.
Gold GLD: cash Gold printed a new five year low last week. Very weak price location.
Oil: broke below the August low on Monday to a six year low and futures have printed a new low today.
EURUSD: last week printed its lowest level since April but sharply higher at the end of the week following the ECB announcement and is currently printing at the high of this rally. First Level Resistance at 1.1080, 1/2R off March low.
