* Latest Market Developments *

NOTE: I am out of the office all week this week. My friend and fellow market analyst Ken Seehusen will be producing my report today. Ken’s format and style is a bit different than mine, but I think you’ll enjoy and benefit from his work, too.—Jim

The STOCK INDEXES: The March NASDAQ 100 was slightly higher overnight as it consolidates some of Tuesday’s decline. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If March extends the rally off December’s low, November’s high crossing at 4342.00 is the next upside target. Closes below the 20-day moving average crossing at 4255.64 would confirm that a short-term top has been posted. First resistance is last Friday’s high crossing at 4322.00. Second resistance is November’s high crossing at 4342.00. First support is the 20-day moving average crossing at 4255.64. Second support is the 25% retracement level of the October-November-rally crossing at 4181.09.

The March S&P 500 was higher overnight as it consolidates some of Tuesday’s decline. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If March extends the rally off December’s low into uncharted territory, upside targets will be hard to project. Closes below the 20-day moving average crossing at 2048.78 would confirm that a short-term top has been posted. First resistance is last Friday’s high crossing at 2088.50. Second resistance is unknown. First support is the 20-day moving average crossing at 2048.78. Second support is December’s low crossing at 1960.40.

INTEREST RATES: March T-bonds were higher overnight as it extends the rally off last week’s low. Stochastics and the RSI are turning neutral to bullish signaling that sideways to higher prices are possible near-term. If March extends the aforementioned rally, December’s high crossing at 146-19 is the next upside target. If March renews the decline off December’s high, the 38% retracement level of the September-December-rally crossing at 141-25 is the next downside target. First resistance is Tuesday’s high crossing at 144-22. Second resistance is December’s high crossing at 146-19. First support is the 38% retracement level of the September-December-rally crossing at 141-25. Second support is the 50% retracement level of the September-December-rally crossing at 140-10.

ENERGY MARKETS: February Nymex crude oil was lower overnight as it extends this year’s decline. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If February extends the decline off June’s high, monthly support crossing at 50.43 is the next downside target. Closes above the 20-day moving average crossing at 58.57 are needed to confirm that a low has been posted. First resistance is the 10-day moving average crossing at 55.20. Second resistance is the 20-day moving average crossing at 58.57. First support is Tuesday’s low crossing at 52.70. Second support is monthly support crossing at 50.43.

February Henry natural gas was lower overnight and is poised to renew the decline off November’s high. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If February extends the decline off November’s high, monthly support crossing at 2.575 is the next downside target. Closes above the 20-day moving average crossing at 3.495 are needed to confirm that a low has been posted. First resistance is the 10-day moving average crossing at 3.273. Second resistance is the 20-day moving average crossing at 3.495. First support is last Friday’s low crossing at 3.007. Second support is monthly support crossing at 2.575.

CURRENCIES: The March Dollar was lower overnight as it consolidates some of this month’s rally. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If March extends the aforementioned rally, monthly resistance crossing at 92.53 is the next upside target. Closes below the 20-day moving average crossing at 89.47 would confirm that a short-term top has been posted. First resistance is Tuesday’s high crossing at 90.66. Second resistance is monthly resistance crossing at 92.53. First support is the 20-day moving average crossing at 89.47. Second support is December’s low crossing at 87.83.

The March Euro was mostly steady overnight as it consolidates some of the decline off December’s high. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If March extends the decline off November’s high, monthly support crossing at 120.51 is the next downside target. Closes above the 20-day moving average crossing at 123.05 are needed to confirm that a low has been posted. First resistance is the 10-day moving average crossing at 122.15. Second resistance is the 20-day moving average crossing at 123.05. First support is Tuesday’s low crossing at 121.32. Second support is monthly support crossing at 120.51.

PRECIOUS METALS: February gold was slightly lower overnight. Stochastics and the RSI have turned neutral to bullish hinting that a low might be in or is near. Closes above the 20-day moving average crossing at 1200.30 are needed to confirm that a low has been posted. If February resumes the decline off December’s high, December’s low crossing at 1141.70 is the next downside target. First resistance is the 20-day moving average crossing at 1200.30. Second resistance is December’s high crossing at 1239.00. First support is last Monday’s low crossing at 1170.70. Second support is December’s low crossing at 1141.70.

GRAINS: March corn was lower due to profit taking overnight. The low-range close sets the stage for a steady to lower opening when the day session begins trading. Stochastics and the RSI have turned neutral to bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing at 4.03 1/2 are needed to confirm that a short-term top has been posted. If March extends the rally off October’s low, the 50% retracement level of this year’s decline crossing at 4.26 3/4 is the next upside target. First resistance is last Tuesday’s high crossing at 4.15 3/4. Second resistance is the 50% retracement level of this year’s decline crossing at 4.26 3/4. First support is the 20-day moving average crossing at 4.03 1/2. Second support is the reaction low crossing at 3.77 1/4.

March wheat was lower overnight as it extends the decline off December’s high. The low-range close sets the stage for a steady to lower opening when the day session begins trading. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near-term. If March extends the aforementioned decline, the reaction low crossing at 5.72 3/4 is the next downside target. Closes above the 10-day moving average crossing at 6.23 3/4 would confirm that a short-term low has been posted. First resistance is the 10-day moving average crossing at 6.23 3/4. Second resistance is December’s high crossing at 6.77. First support is the overnight low crossing at 5.97 3/4. Second support is the reaction low crossing at 5.72 3/4.

March soybeans were lower overnight while extending the trading range of the past two months. The low-range close sets the stage for a steady to lower opening when the day session begins trading. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near-term. Closes below the reaction low crossing at 10.23 1/4 would open the door for additional weakness near-term. If March renews the rally off October’s low, the 50% retracement level of the 2013-2014-decline crossing at 11.18 1/2 is the next upside target. First resistance is November’s high crossing at 10.89 3/4. Second resistance is the 50% retracement level of the 2013-2014-decline crossing at 11.18 1/2. First support is the reaction low crossing at 10.23 1/4. Second support is December’s low crossing at 9.91.