Friday, April 12–Jim Wyckoff’s Morning Web Log

* LATEST MARKET DEVELOPMENTS *

A heavy slate of U.S. economic data is due for release Friday, including the producer price index, retail sales, the University of Michigan consumer sentiment survey, and manufacturing and trade inventories. Markets could be impacted by the fresh batch of statistics on the health of the U.S. economy–especially since there is no other major fundamental event on the front burner of the market place Friday morning. There is some concern among gold traders that if Cyprus sells some of its official gold reserves to help finance its European Union bailout package, other countries like Italy, Portugal and Spain may do the same. Earlier this week it was reported Cyprus would sell about 10 tons of its gold reserves to help finance its EU bailout. In overnight news, European Union industrial production rose more than expected in February. The 17-country Euro zone industrial production rose by 0.4% from January to February. European and Asian stock markets were slightly lower Friday.–Jim

U.S. STOCK INDEXES

S&P 500 futures: Prices are weaker early yesterday on profit taking after hitting an all-time high Thursday. Bulls still have the solid overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are bullish early yesterday. 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 neutral to bearish early yesterday. Yesterday, shorter-term technical resistance comes in at Thursday’s all-time high of 1,592.50 and then at 1,600.00. Buy stops likely reside just above those levels. Downside support for active traders yesterday is located at 1,575.00 and then at 1,568.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5

Nasdaq index futures: Prices are weaker early yesterday on profit taking after hitting a six-month high Thursday. Bulls still have the overall near-term technical advantage. The shorter-term moving averages (4- 9-and 18-day) are bullish early yesterday. The 4-day moving average is above the 9-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 Thursday’s high of 2,858.50 and then at 2,875.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 2,823.00 and then at 2,800.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5.

Dow futures: Prices are weaker early yesterday on profit taking after hitting another all-time high on Thursday. Bulls still have the solid overall near-term technical advantage. Sell stops likely reside just below technical support at Thursday’s low of 14,720 and then at Wednesday’s low of 14,660. Buy stops likely reside just above technical resistance at Thursday’s high of 14,818 and then at 14,850. Shorter-term moving averages are bullish early yesterday, as the 4-day moving average is above the 9-day. The 9-day moving average is above the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are neutral early yesterday. Wyckoff’s Intra-Day Market Rating: 4.5

U.S. TREASURY BONDS AND NOTES

June U.S. T-Bonds: Prices are higher early yesterday. Bulls 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 early yesterday. Shorter-term resistance lies at the overnight high of 146 30/32 and then at 147 16/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 146 5/32 and then at this week’s low of 145 26/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0 June U.S. T-Notes: Prices are higher early yesterday. Bulls have the near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early yesterday. 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 early yesterday. Shorter-term resistance lies at the overnight high of 132.27.5 and then at 133.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 132.16.5 and then at this week’s low of 132.10.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0

U.S. DOLLAR INDEX

The U.S. dollar index is firmer in early U.S. trading. The index has turned choppy this week. The greenback bulls have the overall near-term technical advantage but have faded a bit recently. Slow stochastics for the dollar index are bearish early yesterday. The dollar index finds shorter-term technical resistance at Thursday’s high of 82.680 and then at 82.820. Shorter-term support is seen at this week’s low of 82.140 and then at 82.000. Wyckoff’s Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

Crude oil prices are lower early yesterday. Bulls are fading again. In May Nymex crude, look for buy stops to reside just above resistance at $93.00 and then at the overnight high of $93.52. Look for sell stops just below technical support at the April low of $91.91 and then at $90.50. Wyckoff’s Intra-Day Market Rating: 4.0

GRAINS

Markets were mostly higher overnight. Wet, cold weather in the U.S. Midwest is supporting the bullish camp in corn, due to ideas of planting delays, even though soil moisture profiles in the Corn Belt continue to improve. Meantime, freezing weather in the U.S. Plains states this week is supporting buying interest in wheat futures due to worries of frost or freeze damage to the wheat crop. The first grain market “weather scare” of the U.S. planting and growing season is now on the doorstep.