Technical analysis – Market pre-open 18th March 2016
On Thursday Aggressive Buying (green-at-top) was marked again as ES printed a new high for this rally. Buyers are still in control, see Wednesday’s highlighted comments. Significant Selling (red) has not been marked for thirteen days.
Dayframe: First hour post-open today I will be interested to see if Sellers respond to price in the mid 2040s. Failing that and with Buyers Active and Effective so far this week I would look for a strong end to the week.
First Level Support = 1990 (32day 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 90% (from 88%), Nasdaq 75% (from 70%), R2000 80% (from 74%). Numbers >50 are supportive.
My version of the Rydex Assets Ratio was lower at 3.51. 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 has rallied this week.
Dollar Index: this week has printed a new low for the year and at its lowest since October.
Gold: GLD has rallied strongly and is printing above 115.50, the major poc, which is now Support.
Oil: has today printed a new high for the year and at its highest since early December.
EURUSD: has found Support this week at 1.1085, the 1/2R off last year’s low and printed a 25day high on Thursday.
