*OVERNIGHT DEVELOPMENTS*

The market place so far Friday morning is reflecting at least a temporary decrease in trader and investor anxiety. World stock markets are seeing relief rallies after strong selling pressure seen for much of this week. U.S. stock indexes by the close Thursday recovered from strong losses seen earlier in the day, due in part to comments from Federal Reserve Bank of St. Louis present Bullard. He said the U.S. central bank ought to reconsider ending its monthly bond-buying program, also known as quantitative easing. U.S. stock indexes were sharply higher in early electronic trading Friday morning.

However, there is still a big pot of worry simmering on the stove. The elements that pushed the stock markets sharply lower and goosed U.S. Treasury prices have not just vanished. And there is a new worry late this week: Venezeula’s precarious financial condition after crude oil prices plunged this week. That nation, already in economic trouble, derives most of its income from crude oil exports. Also late this week stress cracks are again forming in the European Union periphery nations that were in big financial trouble just over two years ago.

I would not be surprised if risk aversion again increases as Friday’s trading session progresses. What lies in store for the markets come next Monday morning is likely to weigh more heavily and traders’ and investors’ minds as the day wears on Friday.

U.S. economic data due for release Friday includes new residential construction and the University of Michigan consumer sentiment survey. Fed Chair Janet Yellen also speaks at a conference today.

Wyckoff’s Daily Risk Rating: 7.0 (The market place is still a bit anxious after a turbulent trading week and heading into the weekend.)

(Wyckoff’s Daily Risk Rating is your way to quickly gauge investor risk appetite in the world market place each day. Each day I assess the “risk-on” or “risk-off” trader mentality in the market place with a numerical reading of 1 to 10, with 1 being least risk-averse (most risk-on) and 10 being the most risk-averse (risk-off), and 5 being neutral.

–Jim Wyckoff

U.S. STOCK INDEXES

S&P 500 December e-mini futures: Prices are sharply higher in early trading, on short covering and bargain hunting. The shorter-term moving averages (4-, 9- and 18-day) are still bearish early today. The 4-day moving average is below the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at 1,883.25 and then at 1,892.75. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,851.00 and then at 1,840.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 6.0

Nasdaq index futures: Prices are sharply higher in early trading. Bargain hunting and short covering are featured. Shorter-term moving averages (4- 9-and 18-day) are still bearish early today. The 4-day moving average is below the 9-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at 3,810.00 and then at 3,825.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 3,775.00 and then at the overnight low of 3,749.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0

Dow futures: Prices are sharply higher in early U.S. trading. Buy stops likely reside just above technical resistance at 16,250 and then at 16,300. Sell stops likely reside just below technical support at 16,100 and then at 16,000. Shorter-term moving averages are still bearish early today, as the 4-day moving average is below the 9-day. The 9-day moving average is below the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are neutral early today. Wyckoff’s Intra-Day Market Rating: 6.0

U.S. TREASURY BONDS AND NOTES

December U.S. T-Bonds: Prices are weaker early today on profit taking from recent strong gains. Bulls have the solid overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are still 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 bearish early today. Shorter-term resistance lies at the overnight high of 143 29/32 and then at 144 even. Buy stops likely reside just above those levels. Shorter-term technical support is seen at the overnight low of 142 17/32 and then at 142 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5 December U.S. T-Notes: Prices are weaker in early trading, on profit taking from recent strong gains. Bulls still have the solid overall near-term technical advantage. 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 bearish early today. Shorter-term resistance lies at 128.00.0 and then at the overnight high of 128.10.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 127.19.0 and then at 127.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5

U.S. DOLLAR INDEX

The December U.S. dollar index is weaker in early trading. Bulls still have the overall near-term technical advantage but have faded this week. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 85.175 and then at Thursday’s high of 85.530. Shorter-term support is seen at Thursday’s low of 84.835 and then at this week’s low of 84.525. Wyckoff’s Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

November Nymex crude oil prices are higher early today and seeing a short-covering bounce after hitting a more-than-two-year low on Thursday. Bears are still in strong overall near-term technical control. Look for buy stops to reside just above technical resistance at Thursday’s high of $84.83 and then at $85.00. Look for sell stops just below technical support at $83.00 and then at $82.50. Wyckoff’s Intra-Day Market Rating: 5.5

GRAINS

Markets were again narrowly mixed in overnight trading. The risk aversion in the market place recently has been a bearish drag on the grain futures markets. However, the grains have held up pretty well amid that worry in the market place. Recent technical developments begin to suggest that market bottoms are in place, which can also be called “harvest lows.” Bullish weekly high closes today would be significant clues market lows are in place.