Technical analysis – Market pre-open 16th December 2015
Sellers were active intraday on Tuesday but a higher Value Area was generated which does not indicate Effective Selling. In the ST neither Buying or Selling activity is obviously controlling, see yesterday’s comments, but this is a market anticipating a big FED day. In the longer timeframe I would need to see Significant Buying marked before considering the long side.
Dayframe: The 1/2R off the November high is at 2043.00. Price relative to this level could be worth monitoring today.
Resistance 2087.00 (5mn poc) to 2094.00 (maj poc)
First Level S/R = 2043.00 (1/2R off November’s high, Mar contract)
Support = 1965.25 (1/R off this year’s high)
Key Charts/Levels to watch this week:
IWM: 1/2R (off Sep low) Resistance at 113.53.
SPY: 1/2R (off this year’s high) Support at 198.10.
Stocks>50dyma numbers: Nyse 26% (from 21%), Nasdaq 37% (from 30%), R2000 31% (from 24%). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio was slightly higher at 7.79. SPY fell nearly 5% from the close on 12/01. The ratio hit 9.00 on 12/01 (a 70day high) but only fell by 15% to 7.61. This does not indicate much fear from the Rydex traders which is a little worrying.
Supporting Charts:
Bonds IEF, the 7-10 yr ETF: closed below 106.60 (18mn poc). There is Support at 105.00, the major poc.
Dollar Index: earlier in the month probed above the March high but this was rejeceted.
Gold GLD: closed on Tuesday close to the five year low recorded earlier this month. Very weak price location.
Oil: printed a new six year low on Monday.
EURUSD: up from the ECB announcement earlier in the month. First Level Resistance at 1.1080, 1/2R off March low.
