*OVERNIGHT DEVELOPMENTS*

In overnight news there was more dour economic news coming out of the European Union, as Germany’s factory output was down 4% on the month in August, which was well below expectations of a decline of 1.5%. The struggling European Union economy continues to be a major drag on the entire world economic system. The sinking Euro currency is a result of the economic troubles in the EU. Also, the U.S. dollar has garnered much of its recent strength from a flagging Euro currency.

Most of China has been on holiday the past week and Wednesday is the end of the Golden Week holiday. The commodity markets will see increased participation from the Chinese, and look to fresh China economic readings, as the world’s second-largest economy gets back to work.

U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, consumer credit and the IBD/TIPP economic optimism index. The highlight of the U.S. data week is Wednesday afternoon’s FOMC minutes.

Wyckoff’s Daily Risk Rating: 6.0 (The market place this week is paying little attention to world geopolitical hotspots, and is instead focusing more on the Ebola disease that is spreading.)

(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), and 5 being neutral.

–Jim  Wyckoff

U.S. STOCK INDEXES

S&P 500 December e-mini futures: Prices are weaker in early trading. Bulls are trying to recover from a near-term price downtrend but have more work to do. The shorter-term moving averages (4-, 9- and 18-day) are still bearish early today. The 4-day moving average is below the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at the overnight high of 1,956.25 and then at Monday’s high of 1,971.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,944.75 and then at 1,935.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5

Nasdaq index futures: Prices are lower in early trading today. Shorter-term moving averages (4- 9-and 18-day) are still 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 neutral early today. Shorter-term technical resistance is seen at the overnight high of 4,005.00 and then at 4,025.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 3,984.00 and then at 3,975.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0

Dow futures: Prices are lower in early U.S. trading. Buy stops likely reside just above technical resistance at 16,903 and then at 16,950. Sell stops likely reside just below technical support at 16,800 and then at 16,750. Shorter-term moving averages are bearish early today, as the 4-day moving average is below the 9-day. The 9-day moving average is below the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are neutral early today. Wyckoff’s Intra-Day Market Rating: 4.0

U.S. TREASURY BONDS AND NOTES

December U.S. T-Bonds: Prices are slightly higher early today. Bulls still have the firm 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 neutral to bullish early today. Shorter-term resistance lies at the overnight high of 139 23/32 and then at last week’s high of 140 1/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 139 10/32 and then at 139 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5 December U.S. T-Notes: Prices are firmer in early trading. Bulls still have the firm 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 neutral to bullish early today. Shorter-term resistance lies at the overnight high of 125.19.5 and then at last week’s high of 125.23.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 125.11.5 and then at Monday’s low of 125.03.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0

U.S. DOLLAR INDEX

The December U.S. dollar index is slightly higher in early trading. Prices are not far below last week’s contract and four-year high. Bulls still have the solid overall near-term technical advantage. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at 86.335 and then at 86.500. Shorter-term support is seen at the overnight low of 85.760 and then at 85.545. Wyckoff’s Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

November Nymex crude oil prices are weaker early today. Bears are still in firm overall near-term technical control. Look for buy stops to reside just above technical resistance at $91.00 and then at $91.79. Look for sell stops just below technical support at the overnight low of $89.67 and then at $89.00. Wyckoff’s Intra-Day Market Rating: 4.5

GRAINS

Markets were mixed but mostly lower in overnight trading. The bulls showed a bit of strength by producing moderate price gains Monday, but have much more heavy lifting to do in the near term to suggest market bottoms are in place, let alone begin to suggest prices can sustain an uptrend. Recent rains have halted harvest work in some of the Corn Belt and that’s also a bit friendly. Focus is starting to shift to the growing season for corn and soybeans in South America.