Tuesday, December 30–Jim Wyckoff’s Morning Web Log

 

Note: I am working a limited schedule out of the office this week. My friend and fellow trader/analyst Ken Seehusen is producing my morning report. Ken’s style is a bit different than mine, but I think enjoy and benefit from Ken’s style, too.–Jim

 

The STOCK INDEXES & MARKETS

The March NASDAQ 100 was higher overnight due to short covering as it consolidates some of Monday’s decline. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. If March extends Monday’s decline, the reaction low crossing at 1135.00 is the next downside target. Closes above the reaction high crossing at 1254.00 are needed to renew this month’s rally. If March renews the rally, the reaction
high crossing at 1321.75 is the next upside target. The March NASDAQ 100 was up 5.00 pts. at 1180.50 as of 5:54 AM CST. First resistance is the 10-day moving average crossing at 1201.20. Second resistance is the reaction high crossing at 1248.75. First support is Monday’s low crossing at 1156.25. Second support is the reaction low crossing at 1135.00. Overnight action sets the stage for a higher opening by March NASDAQ 100 when the day session begins later this morning.

The March S&P 500 index was higher overnight due to short covering as it consolidates some of last week’s decline. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near-term. If December extends last week’s decline, the reaction low
crossing at 828.60 is the next downside target. Closes above the reaction high crossing at 918.50 are needed to renew this month’s rally. First resistance is the 20-day moving average crossing at 877.50. Second resistance is the 10-day moving average crossing at 879.67. First support is last Monday’s low crossing at 853.00. Second support is the reaction low crossing at 828.60. The March S&P 500 Index was up 2.50 pts. at 872.90 as of 5:57 AM CST. Overnight action sets the stage for a steady to higher opening by the December S&P 500 index when the day session begins later this morning.

INTEREST RATES

March T-bonds were lower overnight due to light profit taking as they extend last week’s trading range. Stochastics and the RSI are overbought but remain neutral signaling that sideways to higher prices are still possible near-term. Closes below the 20-day moving average crossing at 137-01 are needed to confirm that a short-term top has been posted. First resistance is the reaction high crossing at 141-28. First support is the 10-day moving average crossing at 140-12. Second support is the 20-day moving average crossing at 137-00.

ENERGY MARKETS

February crude oil was lower overnight as it consolidates some of Monday’s rally. Stochastics and the RSI are oversold and are turning bullish hinting that a short-term low might be in or is near. Closes above the 20-day moving average crossing at 43.80 are needed to confirm that a short-term low has been posted. If February extends last week’s decline, psychological support crossing at 35.00 is the next downside target. First resistance is the 10-day moving average crossing at 40.66. Second resistance is the 20-day
moving average crossing at 43.80. First support is last Wednesday’s low crossing at 35.13. Second support is psychological support crossing at 35.00.

CURRENCIES

The March Dollar was lower overnight as it consolidates some of last week’s rally. Stochastics and the RSI are neutral signaling that sideways to lower prices are possible near-term. If March renews this month’s decline, the 75%
retracement level of the July-November rally crossing at 76.56 is the next downside target. Closes above the 20-day moving average crossing at 83.91 are needed to confirm that a short-term low has been posted. First resistance is Monday’s high crossing at 82.75. Second resistance is the
20-day moving average crossing at 83.91. First support is this month’s low crossing at 78.77. Second support is the 75% retracement level crossing at 76.56.

The March Euro was higher overnight due to short covering as it consolidates some of the decline off this month’s high. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near-term. If March renews this month’s rally, the 75% retracement level of the July-November decline crossing at 148.780 is the next upside target. Closes below the 20-day moving average crossing at 135.144 are needed to confirm that a short-term top has been posted. First resistance is this month’s high crossing at 146.870. Second resistance is the 75% retracement level crossing at 148.780. First support is the 10-day moving average crossing at 140.455. Second support is the 20-day moving average crossing at 135.144.
 
PRECIOUS METALS

February gold was lower overnight due to profit taking as it consolidated some of Monday’s rally. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If February extends this month’s rally, October’s high crossing at 938.80 is the next upside target.
Closes below the 20-day moving average crossing at 823.40 are needed to confirm that a short-term top has been posted. First resistance is Monday’s high crossing at 892.00. Second resistance is October’s high crossing at 938.80. First support is the 10-day moving average crossing at 856.10.
Second support is the 20-day moving average crossing at 823.40.

GRAINS

March corn was higher overnight due to short covering as it consolidates some of Monday’s decline, which posted a key reversal down. Lower energy prices along with a weaker U.S. Dollar are providing underlying support for the overnight gains. Stochastics and the RSI are overbought and are turning neutral to bearish hinting that a short-term top might be in or is near. If March extends this month’s rally, the 25% retracement level of the decline off July’s high crossing at 4.33 1/2 then November’s high crossing at 4.38
1/2 are the next upside targets. Closes below the 20-day moving average crossing at 3.68 1/2 would temper the near-term friendly outlook in the market. First resistance is Monday’s high crossing at 4.23 3/4. Second resistance is the 25% retracement level of the July-December decline
crossing at 4.33 1/2. First support is the 10-day moving average crossing at 3.93 1/4. Second support is the 20-day moving average crossing at 3.68 1/2.

March wheat was higher overnight due to short covering as it consolidates some of Monday’s decline. Stochastics and the RSI are overbought and are turning neutral to bearish hinting that a short-term top might be in or is near. The high-range close overnight sets the stage for a steady to higher opening when the day session opens later this morning. Closes above the reaction high crossing at 6.08 would confirm an upside breakout of this fall’s trading range while opening the door for a possible test of the 25%
retracement level of this year’s decline crossing at 6.71 1/4 later this winter. Closes below the 20-day moving average crossing at 5.39 1/2 would temper the near-term friendly outlook in the market.

SOYBEAN COMPLEX

March soybeans were higher overnight due to short covering as they consolidate some of Monday’s decline. Stochastics and the RSI are overbought and are turning bearish hinting that a short-term top might be in or is near. If March extends this month’s rally, November’s high crossing at 9.93
1/2, which coincides with the 25% retracement level of the July-December decline crossing at 9397 3/4 are the next upside targets. Closes below the 20-day moving average crossing at 8.68 1/4 would temper the near-term friendly outlook in the market. First resistance is Monday’s high crossing at 9.81. Second resistance is November’s high crossing at 9.93 1/2. First support is the 10-day moving average crossing at 9.05. Second support is the 20-day moving average crossing at 8.68 1/4.