* LATEST MARKET DEVELOPMENTS *
Amid a quieter geopolitical front, the economic report highlights for this week appear to be the German ZEW business survey on Tuesday and the U.S. Federal Reserve’s FOMC minutes on Wednesday afternoon.
The Organization for Economic Cooperation and Development Monday reported the collective GDP of the world’s 34 major economies rose by 0.5% in the third quarter, from the second quarter.
Asian stock markets rallied Monday following the release late Friday of a new economic reform plan from China, following its Communist party meeting earlier last week. The plan opens up the financial and stock market sectors more, and eases restrictions on investment.
U.S. economic data due for release Monday includes Treasury international capital flow data and the NAHB housing market index.
Wyckoff’s Daily Risk Rating: 3.0 (The U.S. stock indexes continue to trek higher and hit new record or multi-year highs. There is little risk aversion in the market place to start the new trading week.)
(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 poked to 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 1,800.00 and then at 1,810.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,790.60 and then at 1,778.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 6.0
Nasdaq index futures: Prices are firmer early today and hit another 13-year 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 and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is located at the overnight high of 3,421.25 and then at 3,435.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at Friday’s low of 3,405.25 and then at 3,386.75. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0.
Dow futures: Prices are firmer early today and hit a new record high overnight. Buy stops likely reside just above technical resistance at 16,000 and then at 16,050. Sell stops likely reside just below technical support at 15,900 and then at Friday’s low of 15,850. 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: 6.0
U.S. TREASURY BONDS AND NOTES
December U.S. T-Bonds: Prices are firmer early today. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above 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 last week’s high of 132 31/32 and then at 133 16/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 132 12/32 and then at 132 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
December U.S. T-Notes: Prices are slightly higher early today. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term resistance lies at the overnight high of 126.29.0 and then at 127.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 126.21.0 and then at 126.13.5. 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 near weaker early today. Bulls are fading. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 80.965 and then at Friday’s high of 81.210. Shorter-term support is seen at the overnight low of 80.690 and then at 80.500. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
December Nymex crude oil prices are slightly lower early today and hovering not far above last week’s 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 $94.55. Look for sell stops just below technical support at $93.00 and then at last week’s low of $92.51. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Markets were narrowly mixed overnight. U.S. corn harvest is virtually complete now. Focus switches to the South American planting and growing season for soybeans and corn, and to worldwide export demand for U.S. grain. Corn bulls remain very weak, technically. Last Friday’s news that the U.S. Environmental Protection Agency proposed to reduce the corn for ethanol component in the Renewable Fuels Standard remains a bearish weight on the corn market. Soybean bulls still have the slight near-term technical advantage. Wheat is still technically bearish and will remain a follower of corn for at least the near term.
