Technical analysis – Market pre-open 8th October 2015
On Wednesday ES made a brief test below 1971.00, see yesterday’s highlighted comments, and rallied from there. This is the the 1/2R off this year’s high – and the very minor (10dy) poc has also migrated to this level. ES now needs to hold this Support to remain in a strong ST price location. Overnight ES 1971.00 has been the exact low since yesterday’s high and one hour pre-open ES is printing above 1980. Breadth numbers have improved see below.
First Level Support = ES 1971.00 (1/2R off this year’s high)
Second Level Support = ES 1923.00 (50dy poc)
Major Support = ES 1865.00 (poc)
ETFs: although Momentum is still negative for all four major stock index EWTFs, it is moving up.
Important ETF S/R Levels: SPY 198.09 = 1/2R off May high; IWM 111.50 = poc and 116.00 maj poc; QQQ 105.10 = maj poc; DIA 166.96 = 1/2R off May high.
Short term Breadth on the Pulse chart is now supportive (green) for the first time since May.
Stocks>50dyma numbers: Nyse 55% (from 44%), Nasdaq 48% (from 39%), R2000 53% (from 41%). Numbers >50 are supportive.
Sentiment: My version of the Rydex Assets Ratio was higher at 3.47 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.
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. Momentum is now positive 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.
