* LATEST MARKET DEVELOPMENTS *
In overnight news, U.S. markets are subdued to start the new trading week. The holiday season and end of the year are approaching, with many traders winding things down or stepping to the sidelines until January. Attention of the market place remains on the U.S. “fiscal cliff” tax increases and spending cuts that is fast approaching. The market place reckons odds are a bit higher than not that there will be a last-minute agreement among U.S. lawmakers to avoid the fiscal cliff. The overall situation remains a bearish drag on many markets, including the raw commodities and stock markets. In overnight news, European stocks and the Euro currency were weaker on more dour Euro zone economic news. Euro zone exports were reported down 1.4%, month-on-month, in October. Also, the German Bundesbank said Monday the German economy has seen significant contraction heading into the end of the year. In Japan, the Liberal Democratic Party was swept into power over the weekend, which means Japan’s monetary policy will remain very accommodative. The Japanese yen was sharply lower against the U.S. dollar Monday. Along with the U.S. Federal Reserve’s commitment to easy money announced last week and the European Central Bank being in the same position, such are bullish underlying factors for the raw commodity markets. U.S. economic reports due for release Monday include the Empire State manufacturing survey and Treasury international capital data.–Jim
U.S. STOCK INDEXES
S&P 500 futures: Prices are firmer in early trading today. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at Friday’s high of 1,419.30 and then at 1,425.30. Buy stops
likely reside just above those levels. Downside support for active traders today is located at last week’s low of 1,406.00 and then at the December low of 1,397.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5
Nasdaq index futures: Prices are weaker early today and hit a fresh three-week low overnight. 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 bearish early today. Shorter-term technical resistance is located at the overnight high of 2,638.50 and then at 2,650.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 2,609.25 and then at 2,600.00. 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. Sell stops likely reside just below technical support at 13,055 and then at 13,000. Buy stops likely reside just above technical resistance at Friday’s high of 13,125 and then at 13,170. Shorter-term moving averages are still 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 to bearish early today. Wyckoff’s Intra-Day Market Rating: 5.0
U.S. TREASURY BONDS AND NOTES
March U.S. T-Bonds: Prices are weaker early today. Bulls have faded recently and need to show more power soon. Shorter-term moving averages (4- 9- 18-day) are 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 neutral early today. Shorter-term resistance lies at Friday’s high of 148 19/32
and then 150 even. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 147 30/32 and then at Friday’s low of 147 15/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
March U.S. T-Notes: Prices are weaker early today. Bulls are fading and need to show fresh power soon. Shorter-term moving averages (4- 9- 18-day) are 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 bearish early today. Shorter-term resistance lies at Friday’s high of 132.28.5 and then at 133.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at last week’s low of 132.17.0 and then at 132.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
U.S. DOLLAR INDEX
The March U.S. dollar index is near steady in early U.S. trading today. Bulls have faded recently. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 79.78 and then at 80.00. Shorter-term support is seen at Friday’s low of 79.57 and then at last week’s low of 79.40. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
Crude oil prices are near steady early today. Bears still have the slight overall near-term technical advantage. In January Nymex crude, look for buy stops to reside just above resistance at last week’s high of $87.68 and then at $88.00. Look for sell stops just below technical support at $86.00 and then at last week’s low of $85.21. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Markets were mixed in overnight trading. Corn was steady, soybeans firmer and wheat slightly higher. The grain market bulls have faded recently, with wheat leading downside price action. The wheat market’s price action recently is worrisome for the entire grain futures complex. If wheat prices continue to erode, there is likely to be spillover selling pressure enter the corn and soybean markets and at least limit their upside potential. All grain traders need to keep a closer eye on the wheat market in the near term.
