September 25–Jim Wyckoff’s Early Morning Web Log

OVERNIGHT/EARLY MORNING DEVELOPMENTS

The feature in overnight/early morning trading today is firmer Treasury and U.S. stock index prices. Crude oil and gold are lower, with crude below $60. The U.S. dollar is slightly firmer early today.

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U.S. ECONOMIC REPORTS/EVENTS

On tap for today is existing home sales and the Dallas Fed manufacturing index. Dallas Fed president Fisher speaks today, as does New York Fed president Geithner. President Bush also speaks on the economy today.

U.S. STOCK INDEXES

The stock indexes are firmer in early morning electronic trading, on a corrective bounce from losses sustained late last week. Bulls are fading and need to step up and show some power today.

December S&P 500: The shorter-term moving averages (4-, 9- and 18-day) are turning bearish 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 for today. Today, shorter-term technical support comes in at Friday’s low of 1,321.20. Sell stops likely reside just under that level. More sell stops likely reside under shorter-term technical support at 1,315.00. Upside resistance for active traders today is located at Friday’s high of 1,331.40. Buy stops are likely located just above that price level, and then more buy stops are likely located just above chart resistance at 1,335.00. Wyckoff’s Intra-day Market Rating: 6.0

PIVOT POINT LEVELS FOR DECEMBER S&P 500:

Pivot:———— 1,326.20
1st Support:—— 1,321.00
2nd Support:—— 1,316.00
1st Resistance:— 1,331.15
2nd Resistance:— 1,336.35

December Russell 2000: The shorter-term moving averages (4- 9-and 18-day) are turning bearish today. The 4-day moving average is below the 9-day. The 9-day moving average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical support is located at Friday’s low of 719.00. Sell stops likely reside just below that level, and then more sell stops are likely located just below technical support at Wednesday’s low of 715.00. On the upside, short-term resistance is seen at 730.00. Buy stops are likely located just above that level. More buy stops are likely located just above resistance at Friday’s high of 734.70. Wyckoff’s Intra-Day Market Rating: 6.0

PIVOT POINT LEVELS FOR DECEMBER RUSSELL 2000:

Pivot:———— 725.85
1st Support:—— 717.00
2nd Support:—— 710.15
1st Resistance:— 732.65
2nd Resistance:— 741.53

December Dow: For today, sell stops likely reside just below support at Friday’s low of 11,553 and then more stops just below support at 11,500. Buy stops likely reside just above shorter-term technical resistance at Friday’s high of 11,615 and then heavier buy stops just above resistance at Thursday’s high of 11,650. Shorter-term moving averages are turning bearish, as the 4-day moving average is turning down. The 9-day moving average is above the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are bearish for today. Wyckoff’s Intra-Day Market Rating: 5.0

PIVOT POINT LEVELS FOR DECEMBER DOW:

Pivot:———— 11,587
1st Support:—— 11,559
2nd Support:—— 11,525
1st Resistance:— 11,621
2nd Resistance:— 11,649

U.S. TREASURY BONDS AND NOTES

Prices are higher in early trading in Chicago, and have hit multi-month highs again. Bulls have solid near-term technical momentum after strong recent gains.

December U.S. T-Bonds: Prices hit a fresh 7.5-month high overnight. Shorter-term moving averages (4- 9- 18-day) are bullish today. The 4-day moving average is above the 9-day and is above the 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish for today. Shorter-term technical resistance lies at the overnight high of 112 30/32. Buy stops likely reside just above that level. More buy stops likely reside just above technical resistance at 113 even. Shorter-term technical support lies at the overnight low of 112 18/32. Sell stops likely reside just below that level. More sell stops are likely located below support at 112 8/32. Wyckoff’s Intra-Day Market Rating: 9.0

PIVOT POINT LEVELS FOR DECEMBER T-BONDS:

Pivot:———– 112 14/32
1st Support:—– 112 7/32
2nd Support:—– 111 26/32
1st Resistance:– 112 27/32
2nd Resistance:– 113 2/32

December U.S. T-Notes: Prices hit a fresh eight-month high overight. Shorter-term oscillators (RSI, slow stochastics) are bullish for today. Buy stops likely reside just above shorter-term technical resistance at the overnight high of 108.17.0, and more buy stops are likely located just above resistance at 108.24.0. Shorter-term moving averages are bullish for today. The 4-day moving average is above the 9-day and the 18-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 108.09.5, and then more sell stops just below support at 108.00.0. Wyckoff’s Intra Day Market Rating: 9.0

PIVOT POINT LEVELS FOR DECEMBER T-NOTES:

Pivot:———— 108.08.0
1st Support:—— 108.03.0
2nd Support:—— 107.27.0
1st Resistance:— 108.16.0
2nd Resistance:— 108.21.0