* LATEST MARKET DEVELOPMENTS *
In overnight news, European stocks and the Euro currency were weaker ahead of the Friday “fiscal cliff” talks scheduled between President Obama and congressional leaders. The fiscal cliff matter–which is a package of tax hikes and spending reductions that will go into effect in January if no budget deal is reached between the Obama administration and Congress–has overshadowed significant issues that would likely be on the front burner of the market place at present. Those issues include potential further easing of U.S. monetary policy (QE4) in upcoming FOMC meetings, the European Union sovereign debt crisis, a Chinese leadership change, and rising tensions between Israel and Hamas. Early next week the EU debt crisis will be in keener focus, as there is a meeting of Euro zone officials next Tuesday on when to disburse the next tranche of bailout money to cash-starved Greece, and on what terms Greece will be held in order to receive the money. It’s a messy matter. If EU officials write off too much Greek debt, then other financially troubled EU countries will want the same. Regarding the tensions in the Middle East, Israel appears to be taking a very hard line against Hamas, including the likelihood of moving ground troops into the Gaza strip. Such could agitate Egypt and further inflame Iran. The situation could escalate quickly, which would in turn likely produce significant safe-haven demand for gold, the U.S. dollar and U.S. Treasuries.–Jim
U.S. STOCK INDEXES
S&P 500 futures: Prices are slightly lower early today and hit a fresh 3.5-month low overnight. Bears still have downside momentum. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Today, shorter-term technical resistance comes in at Thursday’s high of 1,358.90 and then at 1,375.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,344.70 and then at 1,330.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5
Nasdaq index futures: Prices are weaker early today and are hovering near a 4.5-month low. The shorter-term moving averages (4- 9-and 18-day) are 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 neutral to bearish early today. Shorter-term technical resistance is located at Thursday’s high of 2,541.00 and then at 2,560.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 2,500.00 and then at 2,475.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
Dow futures: Prices are weaker early today and hovering near a 3.5-month low. Sell stops likely reside just below technical support at Thursday’s low of 12,465 and then at the July low of 12,425. Buy stops likely reside just above technical resistance at Thursday’s high of 12,560 and then at 12,600. Shorter-term moving averages are 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 to bearish early today. Wyckoff’s Intra-Day Market Rating: 4.5
U.S. TREASURY BONDS AND NOTES
December U.S. T-Bonds: Prices are firmer early today and are hovering near a 3.5-month high. Bulls have the 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 neutral early today. Shorter-term resistance lies at this week’s high of 152 15/32 and then at 153 even. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 151 27/32 and then at 151 17/32. 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. The bulls still maintain the 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 neutral early today. Shorter-term resistance lies at last week’s high of 134.06.5 and then at 123.10.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 133.30.0 and then at this week’s low of 133.22.0. 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 firmer in early U.S. trading today and hovering near a two-month high. Bulls have upside near-term momentum on their side. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at this week’s high of 81.32 and then at 81.50. Shorter-term support is seen at the overnight low of 81.08 and then at this week’s low of 80.94. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
Crude oil prices are near steady early today. Bears still have the overall near-term technical advantage as a two-month-old downtrend is in place on the daily bar chart. In December Nymex crude, look for buy stops to reside just above resistance at $86.00 and then at $87.00. Look for sell stops just below technical support at $85.00 and then at last week’s low of $84.05. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Markets were lower in overnight trading. The grain market bears still have some downside momentum as trader and investor attitudes have turned risk-averse recently. Fresh near-term chart damage has been inflicted in soybean, corn and wheat futures this week. Traders will closely scrutinize this morning’s weekly USDA export sales report.
