Monday, July 20--Jim Wyckoff's Morning Web Log

OVERNIGHT/EARLY MORNING DEVELOPMENTS

The market features in overnight/early morning trading today are a lower U.S. dollar versus the other major currencies and higher crude oil prices.

JIM'S MARKET THOUGHT OF THE DAY *

The U.S. dollar index is a basket of several major currencies weighted against the greenback. This morning the dollar index hit a fresh five-week low and appears poised to produce a bearish downside "breakout" from the recent trading range at lower price levels. Should a downside breakout in the dollar index occur, then the commodity market bulls would be re-charged as speculative money would likely begin flowing back into the commodity markets, let by crude oil. This week will likely be an extra important trading week in the currency markets. How the dollar index trends this week could well be how the index trends for the next several weeks, or few months.--Jim

U.S. STOCK INDEXES

The U.S. stock indexes are firmer in early morning trading today. Bulls have recently gained good upside near-term technical momentum.

September S&P 500: The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Today, shorter-term technical support comes in at the overnight low of 933.90 and then at 925.00. Sell stops likely reside just under those levels. Upside resistance for active traders today is located at the June high of 952.50 and then at 965.00. Buy stops are likely located just above those levels. Wyckoff's Intra-day Market Rating: 6.0

Today's key near-term Fibonacci support/resistance level: 918.00.

PIVOT POINT LEVELS FOR SEPTEMBER S&P 500:

Pivot:------------- 934.60

1st Support:-------- 930.65

2nd Support:-------- 924.40

1st Resistance:----- 940.85

2nd Resistance:----- 944.80

Nasdaq Index: The shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. 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 1,523.75 and then at Friday's low of 1,505.00. Sell stops likely reside just below those levels. On the upside, short-term resistance is seen at 1,550.00 and then at 1,565.00. Buy stops are likely located just above those levels. Wyckoff's Intra-Day Market Rating: 6.0

Today's key near-term Fibonacci support/resistance level: 1,483.00

PIVOT POINT LEVELS FOR NASDAQ:

Pivot:------------ 1,521.00

1st Support:------ 1,512.00

2nd Support:------ 1,496.00

1st Resistance:--- 1,537.00

2nd Resistance:--- 1,546.00

September Dow: Sell stops likely reside just below support at 8,700 and then more stops just below support at 8,650. Buy stops likely reside just above shorter-term technical resistance at 8,800 and then at the June high of 8,822. Shorter-term moving averages are bullish early today, as the 4-day moving average is above the 9-day and 18-day. The 9-day moving average is above the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are bullish early today. Wyckoff's Intra-Day Market Rating: 6.0

Today's key near-term Fibonacci support/resistance level: 8,462

PIVOT POINT LEVELS FOR SEPTEMBER DOW:

Pivot:------------ 8,677

1st Support:------ 8,645

2nd Support:------ 8,592

1st Resistance:--- 8,730

2nd Resistance:--- 8,762

U.S. TREASURY BONDS AND NOTES

U.S. T-Bonds and T-Notes are lower in early trading today and prices hit a fresh four-week low overnight. The bears have fresh downside near-term technical momentum, amid the recent rally in the U.S. stock market and the weakening U.S. dollar.

September U.S. T-Bonds: Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical support lies at the overnight low of 115 13/32 and then at 115 even. Sell stops likely reside just below those levels. Shorter-term technical resistance lies at 116 even and then at the overnight high of 116 8/32. Buy stops likely reside just above those levels. Wyckoff's Intra-Day Market Rating: 4.0

Today's key near-term Fibonacci support/resistance level: 115 12/32

September U.S. T-Bonds

138 27/32--lifetime high

121 4/32--100-day moving average

119 8/32--Previous Month's high

118 28/32--9-day moving average

118 19/32--18-day moving average

118 5/32--second pivot point resistance

117 19/32--previous day's high

117 8/32--4-day moving average

117 6/32--first pivot point resistance

116 21/32--pivot point

116 8/32--previous day's close

116 3/32--previous day's low

115 22/32--first pivot point support

115 5/32--second pivot point support

111 21/32--previous month's low

110 8/32--lifetime low

September U.S. T-Notes: Shorter-term oscillators (RSI, slow stochastics) are bearish early today. Buy stops likely reside just above shorter-term technical resistance at the overnight high of 116.13.5 and then at 116.24.0. Shorter-term moving averages are neutral early today. The 4-day moving average is below 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 115.26.5 and then at 115.16.0. Wyckoff's Intra Day Market Rating: 4.0

Today's key near-term Fibonacci support/resistance level: 116.22.0

September U.S. T-Notes

125 24/32--lifetime high

118 25/32--100-day moving average

117 20/32--second pivot point resistance

117 20/32--9-day moving average

117 8/32--previous day's high

117 --first pivot point resistance

117 --18-day moving average

116 31/32--4-day moving average

116 23/32--previous month's high

116 20/32--pivot point

116 12/32--previous day's close

116 8/32--previous day's low

116 --first pivot point support

115 20/32--second pivot point support

112 25/32--previous month's low

109 --lifetime low

CURRENCIES

The September U.S. dollar index is lower in early trading today. Bears have the overall near-term technical edge and are gaining downside momentum. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 79.60 and then at 80.00. Shorter-term support is seen at the June low of 78.83 and then at 78.50. Today's key near-term Fibonacci support/resistance level: 80.01. Wyckoff's Intra Day Market Rating: 4.0

The September Euro is higher in early electronic trading. Prices hit a fresh six-week high overnight. Bulls still have the overall near-term technical advantage and are gaining momentum. Euro finds sell stop orders are likely located just below technical support at 1.4200 and then at 1.4150. Shorter-term technical resistance for the Euro is seen at 1.4300 and then at the June high of 1.4327. 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: 1.41000. Wyckoff's Intra Day Market Rating: 6.0

GOLD

Gold is solidly higher in early dealings today, amid the falling value of the U.S. dollar. For August gold, shorter-term technical resistance is seen at the overnight high of $954.90 and then at $960.00. Buy stops likely reside just above those levels. Sell stops likely reside just below support at $949.00 and then at $942.30. Today's key near-term Fibonacci support/resistance level: $959.00. Wyckoff's Intra-Day Market Rating: 6.5

CRUDE OIL

Crude oil prices are higher early today. In September crude, look for buy stops to reside just above resistance at $66.00 and then just above resistance at $67.00. Look for sell stops just below technical support at $65.00 and then more sell stops just below support at the overnight low of $64.20. Today's key near-term Fibonacci support/resistance level: $67.00. Wyckoff's Intra-Day Market Rating: 6.0

GRAINS

Prices were higher in overnight trading, on a short covering bounce following recent losses and amid bullishly postured "outside markets" that include a lower U.S. dollar, higher crude oil prices and higher U.S. stock indexes. However, gains in the grains today will be limited by continued benign weather patterns in the U.S. Corn Belt.