Technical analysis – Market pre-open 22nd February 2016
See previous comments. ES has consolidated for three days above 1905 and the four most recent Value Areas have been generated above the 1870 poc which is now important Support. Bulls would now want that level to hold. Ninety minutes pre-open today ES prints above 1930. Price momentum (PriceOsc) and breadth have improved. The Rydex traders remain very bearish, see below.
First Level Support (minor) = ES 1886.50 (56 day poc)
Second Level Support (major) = ES 1870 (previous maj poc)
Market Charts: Nyse, Nasdaq and UK remain negative. R2000 turned neutral.
Stocks>50dyma numbers at end of last week: Nyse 44%, Nasdaq 32%, R2000 34%, UK 33%. Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio ended the week 2.64 which is the lowest since November 2012. The rydex traders have taken the rally as an opportunity to sell. On 12/29 the ratio reached 9.17.
Supporting Charts:
Bonds IEF, the 7-10 yr ETF: Held the major Support at 105.00 following October’s decline and rallied strongly. On 02/11 the chart spiked to a new high but is off that level.
Dollar Index: on 02/11 found Support at 95.22, the 12mn poc. Higher from there and Bulls would want to see that level hold. Is today printing up with Resistance at 97.87, the 1/2R off this years high.
Gold: GLD has rallied strongly and now prints above 115.12, the 24mn poc, which is now Support. Cash gold indicates a lower open today.
Oil: is today printing back above (just) the minor 1/2R off the January low. Bulls (and equity Bulls) would want to see time printed above this level.
EURUSD: last week probed above 1.1241, the Major 1/2R, but is off that level and today has broken below 1.1085, the 1/2R off last year’s low. Next Support is 1.0925, the 12mn poc, price printing time below that level would suggest a retest of that low.
