Technical analysis – Market pre-open 7th October 2015
Following the Aggressive Buying on Friday, ES gapped higher to open on Monday. Tuesday tested Monday’s green-at-top high but most time during the session was spent printing at 1971.00, the 1/2R off this year’s high. This level could be intraday Support or Resistance today. Price printing time above 1971.00 would be a further positive but as long as ES holds above the 1923.00 poc (and it does not migrate) it is in a strong price location.
Breadth numbers are improving (but not yet above 50) see below.
potential S/R today = ES 1971.00 (1/2R off this year’s high)
First Level Support = ES 1923.00 (50dy poc)
Second Level Support = ES 1865.00 (poc)
Important ETF S/R Levels: SPY 198.09 = 1/2R off May high; IWM 111.50 = poc; QQQ 105.10 = maj poc; DIA 166.96 = 1/2R off May high.
Stocks>50dyma numbers: Nyse 44% (unch), Nasdaq 39% (from 38%), R2000 41% (from 42%). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio was higher at 3.32 but Monday’s ratio at 3.09 was a two year low.
Supporting Charts:
Bonds TLT: is in a strong price location if it can hold above 121.40 (12mn poc). There is resistance at 126.70, the 1/2R off this year’s high.
Dollar Index: recently found Support at 94.67, the 12mn poc. Rallied back to the Resistance at 96.50 (1/2R off this year’s high) without overcoming it and is still printing below that level. I note that oil, copper and gold are pushing higher
Gold GLD: rallied strongly on Friday above 107.78, the 1/2R off July low. This is strong ST price location if it holds and Momentum is positive and up.
Oil USO: recently found clearly defined Support at the 1/2R off August low and is up from that level. Looks good to break higher in the ST with Momentum just turning positive.
EURUSD: weak LT price location printing below 1.1340 (12mn poc). But in the ST, the chart is currently being Supported by the 1/2R off March low at 1.1083. Price below this level would suggest further weakness.
