Friday, April 26–Jim Wyckoff’s Morning Web Log

* LATEST MARKET DEVELOPMENTS *

The market place is awaiting the latest reading on the growth rate of the U.S. economy, due out Friday morning. The first-quarter advance gross domestic product estimate is seen coming in at a 3.2% annual growth rate, which follows a paltry 0.4% growth rate in the fourth quarter of last year. The GDP data could be a markets-mover in the immediate aftermath of its release, if the figure does not meet market expectations. Traders and investors are already looking forward to key events in Europe next week. Monday is an Italian government bond auction, which is expected to be well-received. Belgium and France also hold government debt auctions next week. Next Thursday the European Central Bank holds its monthly meeting and some believe the ECB will lower its key interest rate by 0.25%, in the wake of weak European Union economic data released recently. Other U.S. economic data due for release Friday includes the University of Michigan consumer sentiment survey.–Jim

U.S. STOCK INDEXES

S&P 500 futures: Prices are slightly lower early today on some mild profit taking after recent gains. 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 above the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at Thursday’s high of 1,588.00 and then at the April high of 1,592.50. Buy stops likely reside just above those levels. Downside support for active traders today is located at Thursday’s low of 1,571.00 and then at 1,560.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5

Nasdaq index futures: Prices are weaker early today on profit taking. 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 above the 9-day and 18-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is located at Thursday’s high of 2,854.50 and then at the April high of 2,858.50. Buy stops likely reside just above those levels. On the downside, short-term support is seen at Thursday’s low of 2,832.50 and then at 2,825.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5.

Dow futures: Prices are weaker early today. Bulls still have the overall near-term technical advantage. Sell stops likely reside just below technical support at 14,600 and then at 14,550. Buy stops likely reside just above technical resistance at 14,650 and then at Thursday’s high of 14,705. Shorter-term moving averages are neutral early today, as the 4-day moving average is above the 9-day and 18-day. The 9-day moving average is below the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Wyckoff’s Intra-Day Market Rating: 4.5

U.S. TREASURY BONDS AND NOTES

June U.S. T-Bonds: Prices are firmer early today. Bulls have the solid overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are 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 early today. Shorter-term resistance lies at the overnight high of 148 11/32 and then at 148 20/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at 148 even and then at the overnight low of 147 27/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5 June U.S. T-Notes: Prices are firmer early today. Bulls have the solid overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are 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 early today. Shorter-term resistance lies at the overnight high of 133.08.0 and then at 133.11.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 133.01.5 and then at Thursday’s low of 132.28.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5

U.S. DOLLAR INDEX

The U.S. dollar index is slightly lower in early U.S. trading, on mild profit taking. The bulls still have the overall near-term technical advantage. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at 83.000 and then at this week’s high of 83.325. Shorter-term support is seen at the overnight low of 82.610 and then at this week’s low of 82.485. Wyckoff’s Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

Crude oil prices are weaker early today on profit taking and a corrective pullback from the big gains seen Wednesday and Thursday. Bulls still have upside technical momentum on their side. In June Nymex crude, look for buy stops to reside just above resistance at $94.00 and then at $95.00. Look for sell stops just below technical support at $92.50 and then at $92.00. Wyckoff’s Intra-Day Market Rating: 4.5

GRAINS

Markets were mostly weaker in overnight trading. There is drier and warmer weather forecast for the U.S. Corn Belt in the coming days, and that is deemed bearish for the grains, as U.S. corn planting will move into high gear over the weekend. One market factor that has been seemingly ignored by the wheat market is the major damage inflicted upon the hard red winter wheat crop in the U.S. Plains, due to freezing weather. The grain market bears continue to hold the overall near-term advantage on the charts.