OVERNIGHT/EARLY MORNING DEVELOPMENTS
The feature in overnight trading was sharply lower precious metals prices, amid a stronger U.S. dollar versus the other major currencies. Stock indexes were firmer in early electronic trading. Crude oil is trading lower in early electronic trading, while U.S. Treasuries are slightly lower. Grains were modestly higher in overnight trading.
U.S. ECONOMIC REPORTS/EVENTS
On tap today us the wholesale trade report and the consumer credit report. The new U.S. Treasury secretary, Hank Paulson, gets sworn in today.
U.S. STOCK INDEXES
The indexes are modestly higher in early morning electronic trading, as prices make a corrective bounce from losses on Friday. My bias is still that trading will remain choppier in the near term, with no strong trends developing.
September S&P 500: Prices Friday pushed to a fresh four-week high in early electronic trading and then sold off to close lower, at the weekly low close and scored a bearish “outside day” down on the daily bar chart Friday. The shorter-term moving averages (4-, 9- and 18-day) are still bullish. However, while the 4-day moving average is above the 9-day and 18-day, it is turning lower now. The 9-day is above the 18-day moving average. Short-term oscillators are bullish today. Today, key shorter-term technical support comes in at Friday’s low of 1,271.10. Sell stops likely reside just under that level. More sell stops likely reside under shorter-term support at 1,266.00. Shorter-term upside resistance for active traders today is 1,280.00. Buy stops are likely located just above that price level, and heavier buy stops are likely located just above solid chart resistance at Friday’s high of 1,289.70.
PIVOT POINT LEVELS FOR S&P 500:
Pivot:———— 1,278.60
1st Support:—— 1,267.50
2nd Support:—— 1,260.00
1st Resistance:— 1,286.10
2nd Resistance:— 1,297.20
September Nasdaq: The shorter-term moving averages (4- 9- and 18-day) are turning bearish. The 4-day is below the 9-day and 18-day moving averages. The 9-day moving average is now below the 18-day. Short-term oscillators are bullish today. Today, shorter-term technical support is located at Friday’s low of 1,542.50. Sell stops likely reside just below that level, and then more sell stops likely reside below support at the June low of 1,537.00. On the upside, short-term resistance at 1,560.00. Buy stops are likely located just above that level. More buy stops are then likely located just above resistance at Friday’s high of 1,579.00.
PIVOT POINT LEVELS FOR NASDAQ:
Pivot:———— 1,557.25
1st Support:—— 1,535.50
2nd Support:—— 1,520.75
1st Resistance:— 1,572.00
2nd Resistance:— 1,593.75
September Dow: Prices Friday closed lower, near the session low, at the weekly low close and scored a bearish “outside day” down on the daily bar chart. Bears have fresh downside technical momentum. For today, sell stops likely reside just below support at Friday’s low of 11,130 and then just below support at of 11,075. Buy stops likely reside just above shorter-term technical resistance at 11,200 and then more buy stops just above resistance 11,260. Shorter-term moving averages are still bullish again today, as the 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. However, the 4-day is turning down and could produce a bearish cross below the 9-day today. Shorter-term oscillators (RSI, slow stochastics) are bearish today.
PIVOT POINT LEVELS FOR DOW:
Pivot:———— 11,210
1st Support:—— 11,079
2nd Support:—— 11,000
1st Resistance:— 11,289
2nd Resistance:— 11,420
U.S. TREASURY BONDS AND NOTES
Both notes and bond prices are weaker in early trading in Chicago, after solid gains scored Friday. Technical odds are increasing that near-term lows are in place in bonds and notes.
September U.S. T-Bonds: Shorter-term moving averages (4- 9- 18-day) are turning bullish today. The 4-day moving average is above the 9-day. The 9-day is still below the 18-day, but could move above it as soon as today, to produce a bullish signal. Oscillators are bearish today. Shorter-term resistance lies at 107 even and then at 107 5/32–last week’s high. Buy stops likely lie just above those levels, with heavier stops just above last week’s high. Shorter-term technical support lies at Friday’s low of 106 7/32. Sell stops likely reside just below that level. More sell stops are likely located below support at 106 even.
PIVOT POINT LEVELS FOR T-BONDS:
Pivot:———– 106 23/32
1st Support:—– 106 10/32
2nd Support:—– 105 25/32
1st Resistance:– 107 8/32
2nd Resistance:– 107 21/32
September U.S. T-Notes: Prices are weaker in early morning dealings. Shorter-term oscillators are bearish today. Buy stops likely reside just above shorter-term resistance at Friday’s high of 104.31.0, and then just above resistance at 105.08.0. Shorter-term moving averages are turning bullish today. The 4-day moving average is above the 9-day, and is now poised to move above the 18-day. The 9-day is still below the 18-day moving average, but is poised to move above it today. Sell stop orders are likely located just below support at Friday’s low of 104.15.0, and then more sell stops just below support at last week’s low of 104.05.0.
PIVOT POINT LEVELS FOR T-NOTES:
Pivot:———— 104.25.0
1st Support:—— 104.18.0
2nd Support:—— 104.09.0
1st Resistance:— 105.02.0
2nd Resistance:— 105.09.0
