Monday, April 1–Jim Wyckoff’s Morning Web Log
* LATEST MARKET DEVELOPMENTS *
In overnight news, most European markets were closed Monday for the Easter holiday. The Cyprus bank bailout situation has calmed down for the moment, but the overall European Union sovereign debt crisis remains as an undercurrent in the risk assessment of the market place. That is supportive for safe-haven assets like the U.S. dollar, U.S. Treasuries and gold. In Asia overnight, China’s official purchasing managers’ index was 50.9 in March, which is up from 50.1 in February but just below market expectations. U.S. economic data due for release Monday includes the U.S. manufacturing PMI, construction spending and the ISM manufacturing report on business. Traders and investors are looking ahead to Friday’s release of the U.S. employment situation report, which is arguably the most important U.S. economic report of the month.–Jim
U.S. STOCK INDEXES
S&P 500 futures: Prices are slightly lower early today on mild profit-taking after prices last week hit a five-year high. Bulls still have the firm overall near-term technical advantage. 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 neutral early today. Today, shorter-term technical resistance comes in at last week’s high of 1,564.30 and then at 1,575.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at Thursday’s low of 1,549.90 and then at last week’s low of 1,539.20. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.0
Nasdaq index futures: Prices are slightly higher early today and hovering near the recent six-month high. Bulls have the overall near-term technical advantage. The shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is located at the March high of 2,817.50 and then at 2,825.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 2,800.00 and then at Thursday’s low of 2,791.50. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.
Dow futures: Prices are slightly higher early today and hovering not far below the all-time record high. Bulls have the solid near-term technical advantage. Sell stops likely reside just below technical support at Friday’s low of 14,460 and then at 13,400. Buy stops likely reside just above technical resistance 14,550 and then at 14,600. Shorter-term moving averages are bullish early today, 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 today. Wyckoff’s Intra-Day Market Rating: 5.5
U.S. TREASURY BONDS AND NOTES
June U.S. T-Bonds: Prices are weaker early today on some profit taking after hitting a three-month high on Thursday. Bulls still have the slight near-term technical advantage, amid safe-haven demand recently. 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 bearish early today. Shorter-term resistance lies at the overnight high of 144 14/32 and then at last week’s high of 1443 31/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at 144 even and then at 143 13/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5 June U.S. T-Notes: Prices were weaker lower overnight on some profit taking after hitting a 3.5-month high on Thursday. Bulls still have some upside near-term technical momentum. 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 bearish early today. Shorter-term resistance lies at the overnight high of 131.31.0 and then at last week’s high of 132.11.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 131.23.5 and then at 131.19.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
U.S. DOLLAR INDEX
The U.S. dollar index is slightly lower early today on mild profit taking after hitting a 7.5-month high last week. The greenback bulls 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 the overnight high of 83.365 and then at last week’s high of 83.525. Shorter-term support is seen at 83.00 and then at 82.880. Wyckoff’s Intra Day Market Rating: 5.0
NYMEX CRUDE OIL
Crude oil prices are lower early today on profit taking after hitting a six-week high overnight. Bulls still have the near-term technical advantage. In May Nymex crude, look for buy stops to reside just above resistance at $97.00 and then at the overnight high of $97.80. Look for sell stops just below technical support at $96.00 and then at $95.58. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Markets were lower to sharply lower overnight. Corn is leading the way on the downside following last Thursday’sbearish USDA planting intentions and quarterly grain stocks reports. Serious near-term chart damage has now been inflicted in the grain futures markets. The bearish USDA data last Thursday has now set the tone for bearish grain futures markets for at least the coming weeks. U.S. Corn Belt weather patterns will start to dominate the fundamental news in the coming weeks, but wetter weather patterns in the central U.S. are also bearish for the grains.
