Monday, April 22–Jim Wyckoff’s Morning Web Log

* LATEST MARKET DEVELOPMENTS *

Strong demand has surfaced for physical gold (bars, coins, jewelry) in the wake of this month’s collapse in prices. This is a major factor working to lift gold prices up from last week’s lows and beginning to suggest a market bottom is in place. In overnight news, the Japanese stock market rallied and the yen dropped against the U.S. dollar as the Group of 20 nations at its weekend meeting in Washington, D.C., gave tacit approval of the Bank of Japan’s aggressive monetary policy action recently. Such also hints the major central banks of the world may want to continue their own aggressive monetary policy easing measures for at least the next several months. European stocks were also firmer Monday as Italian bond yields declined amid ideas of better political stability in Italy. U.S. economic data due for release Monday includes the Chicago Fed national activity index and existing home sales.–Jim

U.S. STOCK INDEXES

S&P 500 futures: Prices are firmer early today. Bulls still have the overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at 1,570.00 and then at last week’s high of 1,582.80. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,548.40 and then at last week’s low of 1,531.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5

Nasdaq index futures: Prices are higher early today. Bulls have the overall near-term technical advantage. The shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is located at 2,800.00 and then at 2,823.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 2,770.75 and then at 2,760.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0.

Dow futures: Prices are firmer early today. Bulls have the overall near-term technical advantage. Sell stops likely reside just below technical support at 14,500 and then at 14,450. Buy stops likely reside just above technical resistance at 14,560 and then at 14,600. Shorter-term moving averages are neutral early today, as the 4-day moving average is below the 9-day and 18-day. The 9-day moving average is above the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are neutral early today. Wyckoff’s Intra-Day Market Rating: 5.5

U.S. TREASURY BONDS AND NOTES

June U.S. T-Bonds: Prices are lower early today. Bulls still have the overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are still bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term resistance lies at the overnight high of 148 3/32 and then at 148 9/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 147 15/32 and then at last week’s low of 147 5/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5 June U.S. T-Notes: Prices are weaker early today. Bulls still have the overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are still bullish early today. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 132.31.5 and then at 133.07.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 132.24.5 and then at 132.20.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5

U.S. DOLLAR INDEX

The U.S. dollar index is firmer in early U.S. trading and hit a two-week high overnight. The bulls have the overall near-term technical advantage. Slow stochastics for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at this week’s high of 82.815 and then at 83.000. Shorter-term support is seen at the overnight low of 82.750 and then at 82.500. Wyckoff’s Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

Crude oil prices are firmer early today on short covering after hitting a 9.5-month low of $85.90 last week. Bears still have the near-term technical advantage. In June Nymex crude, look for buy stops to reside just above resistance at $89.40 and then at $90.00. Look for sell stops just below technical support at $88.00 and then at $87.50. Wyckoff’s Intra-Day Market Rating: 5.5

GRAINS

Markets were lower overnight. Recent moisture in the U.S. Corn Belt and Plains states is a bearish factor for grains, even though it could turn to a bullish factor for corn soon, due to the specter of corn-planting delays in the U.S. However, there is drier weather forecast for the U.S. Corn Belt in the extended forecast. Traders will closely scrutinize Monday morning’s weekly USDA export inspections reports. Grain traders will also continue to look to the outside markets for direction.