* LATEST MARKET DEVELOPMENTS *

Most commodity markets, including the precious metals, are trading higher early Monday. Investor risk appetite has modestly improved to start the new year, which has been a bullish underlying factor for the commodity markets. European stocks markets and the Euro currency were lifted overnight on ideas the European Union sovereign debt crisis has turned the corner toward recovery. The Paris-based OECD reported overnight that the Euro zone economic slowdown has bottomed out and that other major world economies are likely to see better growth in the coming months. Gains in European markets were limited by a weak Euro zone industrial production report Monday that showed a 0.3% decline from October to November. There is no major U.S. economic data due for release Monday. However, Federal Reserve Chairman Bernanke is scheduled to speak at an event in Michigan.–Jim

U.S. STOCK INDEXES

S&P 500 futures: Prices are near steady in early trading today, and did poke to another fresh five-year high overnight. Bulls have upside near-term technical momentum. 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 early today. Today, shorter-term technical resistance comes in at the overnight high of 1,471.30 and then at 1,480.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at 1,460.00 and then at 1,450.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5

Nasdaq index futures: Prices are weaker early today after hitting a fresh three-month high earlier today. Bulls still have the overall near-term technical advantage. 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 resistance is located at the overnight high of 2,750.25 and then at 2,760.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 2,725.00 and then at 2,713.75. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5

Dow futures: Prices are weaker early today on some profit taking from recent gains as prices hover near a three-month
high. Bulls still have some upside near-term technical momentum. Sell stops likely reside just below technical support at Friday’s low of 13,380 and then at 13,325. Buy stops likely reside just above technical resistance at Friday’s high of 13,435 and then at 13,500. 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 neutral early today. Wyckoff’s Intra-Day Market Rating: 5.0

U.S. TREASURY BONDS AND NOTES

March U.S. T-Bonds: Prices are higher early today on more short covering. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term resistance lies at 146 even and then at 146 10/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at 145 16/32 and then at the overnight low of 144 13/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0

March U.S. T-Notes: Prices are higher early today on short covering. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term resistance lies at 132.08.0 and then at 132.12.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at 132.00.0 and then at the overnight low of 131.27.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0

U.S. DOLLAR INDEX

The March U.S. dollar index is near steady early today and did hit a fresh three-week low overnight. Greenback bears still have downside near-term technical momentum. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at 79.75 and then at Friday’s high of 79.93. Shorter-term support is seen at the overnight low of 79.40 and then at 79.25. Wyckoff’s Intra Day Market Rating: 5.0

NYMEX CRUDE OIL

Crude oil prices are firmer early today. Prices late last week hit a four-month high. Bulls still some upside momentum and have the overall near-term technical advantage. In February Nymex crude, look for buy stops to reside just above resistance at last week’s high of $94.70 and then at $95.00. Look for sell stops just below technical support at $93.00 and then at last week’s low of $92.42. Wyckoff’s Intra-Day Market Rating: 5.5

GRAINS

Markets were higher overnight on short covering and bargain hunting following Friday’s USDA data that was neutral to bullish, overall. Grain futures markets showed good upside price action on Friday to give the bulls some hope. There are now some very early technical clues the grain markets may have put in near-term lows. However, the bulls need to prove themselves this week. This week’s price action will be extra important in the grain markets.