October 3–Jim Wyckoff’s Early Morning Web Log

OVERNIGHT/EARLY MORNING DEVELOPMENTS

The feature in overnight/early morning trading today is a modest rebound in crude oil and gold prices. Stock indexes and bonds are steady to firmer. The U.S. dollar is higher in early trading.

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U.S. ECONOMIC REPORTS/EVENTS

On tap for today is the MBA refinancing index, the ADP employment estimate, factory orders, the ISM non-manufacturing index, and weekly DOE energy stocks data. New York Fed president Geither speaks in Washington today. Fed governor Bies speaks in Mexico, Fed governor Kohn speaks in New York and Fed Chairman Bernanke speaks in Washington.

U.S. STOCK INDEXES

The stock indexes are firmer in early morning electronic trading. Bulls still have the slight near-term technical advantage.

December S&P 500: The shorter-term moving averages (4-, 9- and 18-day) are turning bearish today. The 4-day moving average is turning down. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bullish for today. Today, shorter-term technical support comes in at the overnight low of 1,341.60. Sell stops likely reside just under that level. More sell stops likely reside under shorter-term technical support at Tuesday’s low of 1,336.00. Upside resistance for active traders today is located at Tuesday’s high of 1,347.80. Buy stops are likely located just above that price level, and then more buy stops are likely located just above chart resistance at last week’s high of 1,350.70. Wyckoff’s Intra-day Market Rating: 7.0

PIVOT POINT LEVELS FOR DECEMBER S&P 500:

Pivot:———— 1,347.00
1st Support:—— 1,343.35
2nd Support:—— 1,341.35
1st Resistance:— 1,349.05
2nd Resistance:— 1,352.75

December Russell 2000: The shorter-term moving averages (4- 9-and 18-day) are bearish today. The 4-day moving average is below the 9-day and 18-day. The 9-day moving average is above the 18-day, but just barely. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical support is located at Tuesday’s low of 716.80. Sell stops likely reside just below that level, and then more sell stops are likely located just below technical support at the September low of 705.75. On the upside, short-term resistance is seen at Tuesday’s high of 728.00. Buy stops are likely located just above that level. More buy stops are likely located just above resistance at this week’s high of 732.25. Wyckoff’s Intra-Day Market Rating: 4.0

PIVOT POINT LEVELS FOR DECEMBER RUSSELL 2000:

Pivot:———— 722.35
1st Support:—— 716.75
2nd Support:—— 711.20
1st Resistance:— 727.95
2nd Resistance:— 733.60

December Dow: For today, sell stops likely reside just below support at 11,750 and then more stops just below support at Tuesday’s low of 11,712. Buy stops likely reside just above shorter-term technical resistance at Tuesday’s high of 11,823 and then more buy stops just above resistance at the contract high of 11,830. Shorter-term moving averages are bullish, 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 to bullish for today. Wyckoff’s Intra-Day Market Rating: 8.0

PIVOT POINT LEVELS FOR DECEMBER DOW:

Pivot:———— 11,775
1st Support:—— 11,727
2nd Support:—— 11,664
1st Resistance:— 11,838
2nd Resistance:— 11,886

U.S. TREASURY BONDS AND NOTES

Prices are steady to firmer in early trading in Chicago. Bulls still have the near-term technical advantage.

December U.S. T-Bonds: Shorter-term moving averages (4- 9- 18-day) are neutral today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral for today. Shorter-term technical resistance lies at the overnight high of 112 21/32. Buy stops likely reside just above that level. More buy stops likely reside just above technical resistance at Tuesday’s high of 112 26/32. Shorter-term technical support lies at the overnight low of 112 12/32. Sell stops likely reside just below that level. More sell stops are likely located below support at this week’s low of 112 4/32. Wyckoff’s Intra-Day Market Rating: 6.5

PIVOT POINT LEVELS FOR DECEMBER T-BONDS:

Pivot:———– 112 19/32
1st Support:—– 112 11/32
2nd Support:—– 112 5/32
1st Resistance:– 112 25/32
2nd Resistance:– 113 1/32

December U.S. T-Notes: Shorter-term oscillators (RSI, slow stochastics) are neutral for today. Buy stops likely reside just above shorter-term technical resistance at Tuesday’s high of 108.12.0, and more buy stops are likely located just above resistance at 108.16.0. Shorter-term moving averages are neutral for today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Sell stop orders are likely located just below support at 108.00.0, and then more sell stops just below support at last week’s low of 107.28.0. Wyckoff’s Intra Day Market Rating: 6.5

PIVOT POINT LEVELS FOR DECEMBER T-NOTES:

Pivot:———— 108.07.0
1st Support:—— 108.03.0
2nd Support:—— 107.30.0
1st Resistance:— 108.12.0
2nd Resistance:— 108.30.0