Tuesday, December 16–Jim Wyckoff’s Morning Web Log
OVERNIGHT/EARLY MORNING DEVELOPMENTS
The market feature in overnight/early morning trading today is higher U.S. Treasury futures prices that are at or near contract and record high price levels.
JIM’S MARKET THOUGHT OF THE DAY *
The Federal Reserve’s Federal Open Market Committee meets today and it’s likely the FOMC will cut U.S. interest rates by 0.5%, to 0.5%. Traders will closely scrutinize the wording of the Fed announcement. There are some more important U.S. economic reports out this week, which will likely continue to point to a serious U.S. economic recession. My bias is that the bad U.S. economic news will persist until at least mid-2009, but that the stock market will bottom out (if not already) well before then.–Jim
U.S. STOCK INDEXES
The U.S. stock indexes are firmer in quieter early morning trading today. Bears still have the overall near-term technical advantage.
March S&P 500: 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 support comes in at the overnight low of 868.90 and then at 850.00. Sell stops likely reside just under those levels. Upside resistance for active traders today is located at Monday’s high of 893.00 and then at 900.00. Buy stops are likely located just above those levels. Wyckoff’s Intra-day Market Rating: 5.0
Today’s key near-term Fibonacci support/resistance level: 849.00.
PIVOT POINT LEVELS FOR MARCH S&P 500:
Pivot:————- 873.95
1st Support:——– 854.90
2nd Support:——– 837.45
1st Resistance:—– 891.40
2nd Resistance:—– 910.45
March Nasdaq Index: The shorter-term moving averages (4- 9-and 18-day) are still bullish early today. The 4-day moving average is above the 9-day, but is turning down. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical support is located at the overnight low of 1,192.00. Sell stops likely reside just below that level, and then more sell stops are likely located just below technical support at 1,176.00. On the upside, short-term resistance is seen at the overnight high of 1,208.00 and then at Monday’s high of 1,224.00. Buy stops are likely located just above those levels. Wyckoff’s Intra-Day Market Rating: 5.5
Today’s key near-term Fibonacci support/resistance level: 1,173.00
PIVOT POINT LEVELS FOR MARCH NASDAQ:
Pivot:———— 1,201.25
1st Support:—— 1,194.50
2nd Support:—— 1,185.25
1st Resistance:— 1,210.50
2nd Resistance:— 1,217.25
March Dow: Sell stops likely reside just below support at 8,600 and then more stops just below support at 8,550. Buy stops likely reside just above shorter-term technical resistance at 8,700 and then just above resistance at 8,750. Shorter-term moving averages are still bullish early today, as the 4-day moving average is above the 9-day and 18-day, but is turning down. The 9-day moving average is above the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Wyckoff’s Intra-Day Market Rating: 5.0
Today’s key near-term Fibonacci support/resistance level: 8,776
PIVOT POINT LEVELS FOR MARCH DOW:
Pivot:———— 8,595
1st Support:—— 8,501
2nd Support:—— 8,397
1st Resistance:— 8,699
2nd Resistance:— 8,793
U.S. TREASURY BONDS AND NOTES
U.S. T-Bonds and T-Notes futures are higher in early trading today. Bulls still have the solid near-term technical advantage amid no clues of a market top being close at hand.
March U.S. T-Bonds: Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical support lies at the overnight low of 135 15/32 and then at 135 even. Sell stops likely reside just below those levels. Shorter-term technical resistance lies at the overnight contract high of 136 12/32 and then at 137 even. Buy stops likely reside just above those levels. Wyckoff’s Intra-Day Market Rating: 7.0
Today’s key near-term Fibonacci support/resistance level: 134 24/32
PIVOT POINT LEVELS FOR MARCH U.S. T-BONDS:
Pivot:———– 135 8/32
1st Support:—– 134 23/32
2nd Support:—– 133 22/32
1st Resistance:– 136 9/32
2nd Resistance:– 136 26/32
March U.S. T-Notes: Shorter-term oscillators (RSI, slow stochastics) are bullish early today. Buy stops likely reside just above shorter-term technical resistance at the contract high of 125.13.5 and then at this 126.00.0. Shorter-term moving averages are bullish early today. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Sell stop orders are likely located just below support at the overnight low of 124.36.0 and then at 124.16.0. Wyckoff’s Intra Day Market Rating: 7.0
Today’s key near-term Fibonacci support/resistance level: 124.01.0
PIVOT POINT LEVELS FOR MARCH U.S. T-NOTES:
Pivot:———– 124 23/32
1st Support:—– 124 6/32
2nd Support:—– 123 17/32
1st Resistance:– 125 12/32
2nd Resistance:– 125 29/32
CURRENCIES
The March U.S. dollar index is weaker in early trading today. The bulls are in trouble. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 83.18 and then at 83.50. Shorter-term support is seen at 82.50 and then at Monday’s low of 82.40. Today’s key near-term Fibonacci support/resistance level: 82.97. Wyckoff’s Intra Day Market Rating: 4.0
The December Euro is slightly higher in early electronic trading and hit a fresh eight-week high overnight. Euro finds sell stop orders are likely located just below technical support at the overnight low of 1.3600 and then at 1.3550. Shorter-term technical resistance for the Euro is seen at the overnight high of 1.3707 and then at 1.3750. Buy stops likely reside just above those levels. Slow stochastics for the Euro are bullish early today. Today’s key near-term Fibonacci support/resistance level: 1.3860. Wyckoff’s Intra Day Market Rating: 6.0
GOLD
Gold is slightly lower in early dealings today, amid the weaker U.S. dollar. For February gold, shorter-term technical resistance is seen at the overnight high of $840.20 and then at Monday’s high of $843.70. Buy stops likely reside just above those levels. Sell stops likely reside just below support at the overnight low of $830.20 and then at $825.00. Today’s key near-term Fibonacci support/resistance level: $844.00. Wyckoff’s Intra-Day Market Rating: 5.0
CRUDE OIL
Crude oil prices are firmer early today as traders await any news from this week’s OPEC meeting. In January crude, look for buy stops to reside just above resistance at $46.00 and then just above resistance at $47.00. Look for sell stops just below technical support at the overnight low of $43.93 and then more sell stops just below support at $43.00. Today’s key near-term Fibonacci support/resistance level: $46.35. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Prices were mixed in overnight trading. Corn was lower and wheat and soybeans were firmer. The key “outside markets” are bullish early today–crude oil prices are higher and the U.S. dollar is lower. Grain market bulls still have some fresh upside near-term technical momentum on their side. Bulls are hoping market lows are in place. The outside markets will continue to dictate price action in the grains.
