Thursday, April 18–Jim Wyckoff’s Morning Web Log

* LATEST MARKET DEVELOPMENTS *

Gold and crude oil prices were under strong selling pressure in Asian trading Thursday, but then posted a solid recovery during European trading hours. The International Monetary Fund this week forecast lower world economic growth, in the latest signal that the major economies of the world continue to sputter, or only see tepid growth. Low inflation readings in the major world economies are also a bearish factor for the beaten-down raw commodity sector. Asian stock markets were lower overnight amid the sell-off in the raw commodity sector during Asian trading hours. European stock markets rose Thursday, boosted by a successful auction of Spanish government bonds. There is a Group of 20 meeting in Washington, D.C. that begins Thursday. The market place will pay close attention to any proclamations regarding foreign exchange rate, financial and/or economic policies coming out of the confab. Reports overnight said the big investment fund BlackRock has done some bargain hunting and purchased gold this week. U.S. economic data due for release Thursday includes the weekly jobless claims report, leading economic indicators, and the Philadelphia Fed business outlook survey.–Jim

U.S. STOCK INDEXES

S&P 500 futures: Prices are firmer early yesterday as trading has turned choppy this week. Bulls still have the overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are neutral early yesterday. The 4-day moving average is below 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 yesterday. Yesterday, shorter-term technical resistance comes in at Wednesday’s high of 1,568.30 and then at this week’s high of 1,582.80. Buy stops likely reside just above those levels. Downside support for active traders yesterday is located at this week’s low of 1,538.30 and then at the April low of 1,533.30. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5

Nasdaq index futures: Prices are higher early yesterday as trading has turned choppy this week. Bulls still have the overall near-term technical advantage. The shorter-term moving averages (4- 9-and 18-day) are neutral early yesterday. The 4-day moving average is below the 9-day and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early yesterday. Shorter-term technical resistance is located at 2,800.00 and then at 2,817.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 2,768.00 and then at this week’s low of 2,758.25. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.

Dow futures: Prices are firmer early yesterday as trading has turned choppy this week. Bulls still have the overall near-term technical advantage. Sell stops likely reside just below technical support at 14,550 and then at this week’s low of 14,500. Buy stops likely reside just above technical resistance at 14,650 and then at Wednesday’s high of 14,695. Shorter-term moving averages are neutral early yesterday, as the 4-day moving average is below the 9-day. The 9-day moving average is above the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are bearish early yesterday. Wyckoff’s Intra-Day Market Rating: 5.5

U.S. TREASURY BONDS AND NOTES

June U.S. T-Bonds: Prices are lower early yesterday. Trading is choppy this week. Bulls still have the overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are still bullish early yesterday. 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 to bearish early yesterday. Shorter-term resistance lies at 148 even and then at the overnight high of 148 11/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at this week’s low of 147 5/32 and then at 147 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5 June U.S. T-Notes: Prices are weaker early yesterday. Bulls still have the near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are still bullish early yesterday. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early yesterday. Shorter-term resistance lies at this week’s high of 133.09.0 and then at the April high of 133.11.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at this week’s low of 132.25.5 and then at 132.20.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5

U.S. DOLLAR INDEX

The U.S. dollar index is lower in early U.S. trading, on a corrective pullback from Wednesday’s strong gains. The index has turned choppy recently but the bulls on Wednesday did regain upside near-term technical momentum. Slow stochastics for the dollar index are bullish early yesterday. The dollar index finds shorter-term technical resistance at Wednesday’s high of 82.815 and then at 83.000. Shorter-term support is seen at 82.500 and then at 82.250. Wyckoff’s Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

Crude oil prices are higher early yesterday after hitting a fresh 9.5-month low of $85.61 in Asian trading yesterday. Bears still have downside near-term technical momentum. In May Nymex crude, look for buy stops to reside just above resistance at $89.00 and then at $90.00. Look for sell stops just below technical support at $87.00 and then at $86.06. Wyckoff’s Intra-Day Market Rating: 6.0

GRAINS

Markets were firmer overnight. Recent moisture in the U.S. Corn Belt and Plains states is turning from a bearish underlying factor for grains, to a bullish factor for corn.The specter of corn-planting delays is now likely this spring. The corn-planting delay issue will likely be a major market factor when trading gets under way next week, if not sooner. Grain traders will continue to look to the outside markets for direction, especially given the volatile trading seen in crude oil and gold recently.