* LATEST MARKET DEVELOPMENTS *

The market place will be closely watching Federal Reserve chair nominee Janet Yellen’s testimony before the U.S. Senate Banking Committee Thursday morning. In her prepared remarks to be given to the committee, which were released late Wednesday afternoon, Yellen said she would continue current Fed Chairman Ben Bernanke’s monetary policies and said the U.S. economy still needs monetary stimulus because it is performing below its potential. The market place read Yellen’s remarks as being in the dovish monetary policy camp. The gold market popped higher Wednesday afternoon following the release of Yellen’s prepared testimony.

The collective European Union gross domestic product expanded by a tepid 0.4% in the third quarter, on an annualized basis. That is down from the 1.2% expansion seen in the second quarter and lends credibility to last week’s interest rate cut by the European Central Bank. The EU GDP report adds to growing worries of worldwide deflationary pressures setting in, which could push back even further any “tapering” of the U.S. Federal Reserve’s monthly bond-buying program, called quantitative easing. While some market watchers think the Fed will announce a cutback in bond buying as soon as December, other market watchers say current economic data does not indicate such, including the worries about worldwide deflationary pressures.

Japan’s GDP grew at an annual rate of 1.9% in the third quarter, it was reported Thursday. Analysts expected a rise of 1.7%. That news rallied the Japanese stock market.

In other news overnight, it was reported that China became the world’s largest gold consumer in the third quarter, overtaking India.

U.S. economic data due for release Thursday includes the weekly jobless claims report and the U.S. trade report.

Thursday’s Wyckoff’s Daily Risk Rating: 6.0 (Not real significant nervousness in the market place, but Yellen’s testimony could move markets.)

(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).–Jim Wyckoff
 
U.S. STOCK INDEXES

S&P 500 futures: Prices are firmer in early U.S. trading and hit another record high overnight. The shorter-term moving averages (4-, 9- and 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at the overnight high of 1,785.20 and then at 1,800.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at 1,773.00 and then at Wednesday’s low of 1,754.70. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 6.0

Nasdaq index futures: Prices are weaker early today, on profit taking from Wednesday’s 13-year high. The shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is located at Wednesday’s high of 3,406.75 and then at 3,425.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 3,375.00 and then at 3,350.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5.

Dow futures: Prices are slightly higher early today and hit a new record high overnight. Buy stops likely reside just above technical resistance at 15,800 and then at 15,850. Sell stops likely reside just below technical support at 15,750 and then at 15,700. 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: 5.5

U.S. TREASURY BONDS AND NOTES

December U.S. T-Bonds: Prices are firmer early today, on more short covering after prices hit a two-month low Tuesday. Shorter-term moving averages (4- 9- 18-day) are still 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 bullish early today. Shorter-term resistance lies at the overnight high of 132 13/32 and then at 132 24/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 132 1/32 and then at last week’s low of 131 18/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
 
December U.S. T-Notes: Prices are firmer early today on more short covering after hitting a four-week low Tuesday. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below 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 the overnight high of 126.27.5 and then at 127.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at 126.10.0 and then at 126.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5

U.S. DOLLAR INDEX

The December U.S. dollar index is higher early today. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at the overnight high of 81.270 and then at last week’s high of 81.580. Shorter-term support is seen at this week’s low of 80.800 and then at 80.500. Wyckoff’s Intra Day Market Rating: 6.0

NYMEX CRUDE OIL

December Nymex crude oil prices are slightly lower early today. Prices Tuesday hit a 4.5-month low. Bears have the overall near-term technical advantage. Prices are in an 11-week-old downtrend on the daily bar chart. In December Nymex crude, look for buy stops to reside just above resistance at $94.00 and then at $94.50. Look for sell stops just below technical support at this week’s low of $92.86 and then at $92.50. Wyckoff’s Intra-Day Market Rating: 4.5

GRAINS

Markets were mixed overnight. Corn bulls need to show some follow-through strength soon, to better suggest this market has hit a harvest low. Soybean bulls have gained upside technical momentum recently. Wheat is still technically bearish but will remain a follower for at least the near term. With the U.S. corn and soybean harvest almost complete, focus of grain market traders turns from U.S. production to overall worldwide demand for U.S. grains, and on the upcoming South American planting and growing season.