* LATEST MARKET DEVELOPMENTS *

In overnight news, there was more dour economic news coming out of the European Union Friday. The European Commission’s Economic Sentiment Indicator came in at 102.0 in June from 102.6 in May. Forecasts were for a figure of 103.0. This reading comes after the EU made moves in early June to boost economic activity, including further easing of EU monetary policy. The report also said EU consumers expect inflation to continue to be very low.

The civil war in Iraq is still an issue for the market place but it has at least temporarily moved off the front burner. Don’t be surprised in the coming days to see this matter move back into the spotlight of the market place and once again significantly impact some market prices.

U.S. economic data due for release Friday is light and includes the University of Michigan consumer sentiment survey.

Wyckoff’s Daily Risk Rating: 6.0 (Civil war in Iraq still has the world market place somewhat concerned but there have been no major new developments this week.)

(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 Wyckoff

U.S. STOCK INDEXES

S&P 500 September e-mini futures: Prices are weaker in early trading. Bulls still have the solid 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. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 1,950.00 and then at this week’s record high of 1,960.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at this week’s low of 1,937.25 and then at 1,929.25. 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. Bulls still have the solid overall near-term technical advantage as prices hover not far below this week’s 14-year high. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the overnight high of 3,818.50 and then at this week’s high of 3,829.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 3,800.00 and then at this week’s low of 3,779.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5

Dow futures: Prices are weaker in early U.S. trading. Bulls still have the overall near-term technical advantage. Buy stops likely reside just above technical resistance at Thursday’s high of 16,780 and then at 16,800. Sell stops likely reside just below technical support at 16,700 and then at Thursday’s low of 16,665. Shorter-term moving averages are bearish early today, as the 4-day moving average is below 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 bearish early today. Wyckoff’s Intra-Day Market Rating: 4.5

U.S. TREASURY BONDS AND NOTES

September U.S. T-Bonds: Prices are firmer early today and hit a four-week high overnight. Bulls have the firm 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. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term resistance lies at 137 16/32 and then at 138 even. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 136 29/32 and then at Thursday’s low of 136 13/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5 September U.S. T-Notes: Prices are firmer in early trading and hit a four-week high overnight. Bulls have the firm 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. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term resistance lies at the overnight high of 125.08.5 and then at 125.12.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 124.31.5 and then at 124.24.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0

U.S. DOLLAR INDEX

The September U.S. dollar index is slightly lower in early trading and hit a five-week low overnight. Bears 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 Thursday’s high of 80.440 and then at this week’s high of 80.505. Shorter-term support is seen at the overnight low of 80.135 and then at 80.000. Wyckoff’s Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

August Nymex crude oil prices are near steady in early U.S. trading. Bulls still have the overall near-term technical advantage. Prices are in a six-month-old uptrend on the daily bar chart. In August Nymex crude, look for buy stops to reside just above resistance at $106.50 and then at $107.00. Look for sell stops just below technical support at the overnight low of $105.48 and then at $105.00. Wyckoff’s Intra-Day Market Rating: 5.0

GRAINS

Markets were mixed to weaker in overnight trading. Weather in the U.S. Corn Belt remains overall favorable for the corn and soybean crops, but recent heavy rains in regions has hurt the crops in those regions. Corn and Wheat market bears are still in overall technical control. Bean bulls have the chart advantage in new-crop November futures. Focus is turning to the upcoming USDA acreage and supply and demand data issued Monday. That report will be quickly digested however, as we are just now entering the time period when dry and hot weather can start to enter the Corn Belt.