Technical analysis – Market pre-open 15th March 2016
See previous comments. Last week ES consolidated at higher levels centred around 1990 which emerged as a minor (30day) poc. Price relative to that level may be useful to monitor as a guide to ST strength/weakness. On Monday ES probed above Friday’s green-at-top high but generated a narrower, “inside” Value Area. In the LT, as long as ES holds above 1956.90, the 1/2R off last year’s high, it is in a strong price location.
First Level Support = 1990 (30day poc)
Second Level Support = 1956.90 (1/2R off last year’s high)
Major Support (major) = ES 1870 (previous maj poc)
Stocks>50dyma numbers: Nyse 87% (from 88%), Nasdaq 74% (from 73%), R2000 77% (from 78%). Numbers >50 are supportive.
My version of the Rydex Assets Ratio was slightly lower at 3.75. The rydex traders remain reluctant to back this rally. This is a contrarian indicator. On 02/19 the ratio fell to 2.64 which was the lowest since November 2012.
Supporting Charts:
Bonds: TLT – On 02/11 the chart spiked to a new high but is off that level. Support at 126.70 (1/2R level). Futures printed a 26day low on Monday but printing higher today.
Dollar Index: currently printing below 97.40, the 2year poc. Time below this level would suggest further weakness. Price above 97.87, the 1/2R off November high, would be a stronger price location.
Gold: GLD has rallied strongly and is printing above 115.50, the major poc, which is now Support. Futures have printed a nine day low today.
Oil: printed a two month high last week but is off that high and lower this week.
EURUSD: printing just above 1.1085, the 1/2R off last year’s low. Price below 1.0925, the 12mn poc would suggest a retest of last year’s low.
