* LATEST MARKET DEVELOPMENTS *
In overnight news, European Union countries’ collective gross domestic product shrank by 0.1% in the third quarter, from the previous quarter, and was down 0.6% from the same period last year. EU businesses curtailed their investment and drew down their existing stockpiles in the three months ending in September. Most believe the EU will continue its economic contraction at least into the fourth quarter of 2012. Meantime, Greece’s unemployment rate rose to 26% in September, from 25.3% in August, it was reported Thursday. On the positive side, German manufacturing orders increased more than expected, at up 3.9% in October. In the U.S., the focus of the market place remains on the “fiscal cliff” tax increases and spending cuts that is fast approaching. U.S. lawmakers are still jawboning on the matter. Wednesday, U.S. Treasury Secretary Geithner said the Obama administration is willing to go over the fiscal cliff if the wealthiest Americans are not taxed more. While the market place presently perceives odds are higher than not that there will be a last-minute agreement among U.S. lawmakers to avoid the fiscal cliff, the overall situation has been a bearish drag on many markets, including the raw commodities and stock markets. The market place is starting to look ahead to next week’s last Federal Reserve FOMC meeting of the year, on December 10 and 11. The “Operation Twist” program ends and the FOMC members must decide whether to extend the bond-buying program. Many believe the Fed will continue to purchase U.S. Treasuries and implement “QE4” at next week’s meeting. That would be raw-commodity market bullish, including bullish for the precious metals markets. U.S. economic reports due for release Thursday include weekly jobless claims, and the Challenger job cuts report.–Jim
U.S. STOCK INDEXES
S&P 500 futures: Prices are near steady early 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 Wednesday’s high of 1,414.80 and then at this week’s high of 1,423.90. Buy stops likely reside just above those levels. Downside support for active traders today is located at this week’s low of 1,397.00 and then at last week’s low of 1,383.20. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.0
Nasdaq index futures: Prices are slightly lower early 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is located at 2,650.00 and then at 2,665.00. Buy stops likely reside just above those
levels. On the downside, short-term support is seen at this week’s low of 2,623.00 and then at 2,611.50. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
Dow futures: Prices are near steady early today. Bulls still have some upside technical momentum on their side. Sell stops likely reside just below technical support at 13,000 and then at 12,950. Buy stops likely reside just above technical resistance at Wednesday’s high of 13,075 and then at 13,100. 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: 5.0
U.S. TREASURY BONDS AND NOTES
March U.S. T-Bonds: Prices are firmer early today. Bulls have the overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term resistance lies at this week’s high of 150 21/32 and then at 151 even. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 150 3/32 and then at Wednesday’s low of 149 27/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
March U.S. T-Notes: Prices are higher early today and hit a fresh contract high overnight. Bulls have the solid 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 bullish early today. Shorter-term resistance lies at 134.00.0 and then at 134.08.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 133.24.0 and then at Wednesday’s low of 133.15.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
U.S. DOLLAR INDEX
The March U.S. dollar index is slightly higher in early U.S. trading today, on tepid short covering after hitting a six-week low on Wednesday. Bears still have some downside near-term technical momentum. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at the overnight high of 80.12 and then at this week’s high of 80.34. Shorter-term support is seen at this week’s low of 79.78 and then at 79.50. Wyckoff’s Intra Day Market Rating: 5.0
NYMEX CRUDE OIL
Crude oil prices are slightly lower early today. Bulls and bears are struggling for near-term control with neither gaining much of an advantage. In January Nymex crude, look for buy stops to reside just above resistance at the overnight high of $88.23 and then at $89.00. Look for sell stops just below technical support at $87.00 and then at $86.00. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Markets were mixed in overnight trading. Soybean bulls have gained fresh upside technical momentum recently, while trading in corn and wheat remains choppy. Traders will closely scrutinize this morning’s weekly USDA export sales report. My bias remains that there is not strong downside price potential in the grains in the coming weeks and months.
