* LATEST MARKET DEVELOPMENTS *
It’s a quiet, pre-holiday trading environment Monday morning. With the Christmas holiday on Wednesday look for thin volumes and lackluster trading conditions for most of this week and next week.
The U.S. stock indexes continue on their major bull market run, with a late-year push that saw the S&P 500 and Dow indexes hit new record highs overnight. The vast majority of the market place has become bullish the stock market, which is a strong clue that the end of this very mature bull run is not far away. The major bull market move in equities has been a bearish drag on other investment asset classes, as many traders and investors presently reckon stocks are the only game in town.
In overnight trading the featured news was spiking short-term interest rates in China, mainly due to end-of-quarter and end-of-year pressures on banks to square up their books. The markets are so far mostly ignoring the matter.
U.S. economic data due for release Monday includes personal income and outlays, the Chicago Fed national activity index and the University of Michigan consumer sentiment survey.
Wyckoff’s Daily Risk Rating: 5.0 (No major headline risk today, and with holidays approaching, trading volumes are likely to wane.)
(Wyckoff’s Daily Risk Rating is your way to quickly gauge investor risk appetite in the world market place each day. Each day I assess the “risk-on” or “risk-off” trader mentality in the market place with a numerical reading of 1 to 10, with 1 being least risk-averse (most risk-on) and 10 being the most risk-averse (risk-off), and 5 being neutral.–Jim
U.S. STOCK INDEXES
S&P 500 futures: Prices are higher in early U.S. trading and hit another record high overnight. 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 still below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at the overnight record high of 1,822.80 and then at 1,835.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,817.10 and then at 1,800.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 6.0
Nasdaq index futures: Prices solidly higher early today and hit another 13-year high. 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 bullish early today. Shorter-term technical resistance is located at the overnight high of 3,559.50 and then at 3,575.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 3,541.00 and then at 3,525.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 7.0
Dow futures: Prices higher and hit another record high overnight. Buy stops likely reside just above technical resistance at 16,300 and then at 16,350. Sell stops likely reside just below technical support at 16,200 and then at 16,135. 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 bullish early today. Wyckoff’s Intra-Day Market Rating: 6.0
U.S. TREASURY BONDS AND NOTES
March U.S. T-Bonds: Prices are near steady early today. The bears still have the overall near-term technical advantage as prices are in a two-month-old downtrend on the daily bar chart. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at 130 11/32 and then at the December high of 130 18/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at 129 20/32 and then at 129 10/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0 March U.S. T-Notes: Prices are lower early today and hovering near a 3.5-month low. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 123.24.0 and then at 124.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 123.17.0 and then at last week’s low of 123.08.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
U.S. DOLLAR INDEX
The March U.S. dollar index is lower early today, on a corrective pullback from recent gains. The greenback bulls have recently gained some upside momentum. Slow stochastics for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at the overnight high of 80.750 and then at last week’s high of 81.005. Shorter-term support is seen at 80.500 and then at 80.400. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
February Nymex crude oil prices are slightly lower early today. Bulls still have the overall near-term technical advantage. In February Nymex crude, look for buy stops to reside just above resistance at last week’s high of $99.49 and then at $100.00. Look for sell stops just below technical support at Friday’s low of $98.54 and then at $98.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Markets were mixed but mostly slightly higher overnight. Hot and dry weather conditions in Argentina are garnering the attention of grain traders early this week. Grain markets have seen the holiday doldrums set in. Technically, corn and wheat futures bears are in full control. Soybean bulls still have the near-term technical advantage.
