Pre-open Friday 4th March
Aggressive Buying was marked on Tuesday and again on Thursday, both times above 1956.90, the 1/2R off last year’s high. This is now First Level Support.
Breadth numbers improved again, see below.
First Level Support = 1956.90 (1/2R off last year’s high)
Second Level Support = ES 1886.50 (70 day poc)
Major Support (major) = ES 1870 (previous maj poc)
Key Charts/Levels: DIA closed above 164.25, its maj poc and above 166.96, the 1/2R off last year’s high, in a strong price location. Price printing time above this level would be a further positive.
Stocks>50dyma numbers: Nyse 80% (from 74%), Nasdaq 65% (from 60%), R2000 69% (from 65%). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio was lower at 3.47. Down from Tuesday’s 4.24 which was a 17day high. The rydex traders have been very slow to get on this rally. This is a contrarian indicator. The ratio recently fell to 2.64 which was the lowest since November 2012.
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 – is off that level and printed a 21 day low on Wednesday.
Dollar Index: is today printing very close to 97.40, the 2year poc, on the low of the week. Price printing time below this level would be weaker location.
Gold: GLD has rallied strongly and is printing above 115.12, the 24mn poc, which is now Support. Cash gold has today printed its highest level since Feb 2015.
Oil: on Thursday printed its highest level since 6th January.
EURUSD: earlier in the month probed above 1.1241, the Major 1/2R, but is off that level and is now printing below 1.1085, the 1/2R off last year’s low. However today the chart has recovered back above 1.0925, the 12mn poc. Price printing time below that level would suggest a retest of last year’s low.
