Monday, April 8–Jim Wyckoff’s Morning Web Log

* LATEST MARKET DEVELOPMENTS *

The market place has gotten a shot of confidence the easy money policies of the major central banks of the world will remain in place for quite some time to come, and that is a bullish underlying factor for hard assets like gold and silver. The weaker-than-expected U.S. jobs report last Friday, the fresh Bank of Japan monetary stimulus announcement last week, and the still-very-weak European Union economic and financial situation all argue for the Federal Reserve, the Bank of Japan and the European Central Bank to keep their feet on the easy money accelerator. North Korea and its nuclear threats toward the U.S. and South Korea continues to attract some attention of the market place. However, there is now the feeling among many that the North Koreans’ trash-talking is old hat and only talk. The U.S. said last week it is taking North Korea’s threats seriously and has dispatched military assets to the region surrounding North Korea. The market place has digesting the news fairly well. However, that could change very quickly if the North Korea situation turns from just rhetoric to military conflict. The wild card in the matter is a new, young leader of the North Korean regime that is unpredictable. U.S. economic data due for release Monday includes the Chicago Fed Midwest Manufacturing index and the employment trends index.–Jim

U.S. STOCK INDEXES

S&P 500 futures: Prices are firmer early today. Bulls still 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 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 1,554.80 and then at last week’s high of 1,568.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,540.00 and then at last week’s low of 1,533.30. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5

Nasdaq index futures: Prices are firmer early today. Bulls still have the overall near-term technical advantage. 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 neutral early today. Shorter-term technical resistance is located at Friday’s high of 2,785.50 and then at 2,800.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 2,762.25 and then at 2,750.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.

Dow futures: Prices are firmer early today. Bulls have the overall near-term technical advantage. Sell stops likely reside just below technical support at 14,500 and then at 14,450. Buy stops likely reside just above technical resistance at 14,550 and then at last week’s high of 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 to bearish 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 profit taking after hitting a four-month high on Friday. Bulls still have the 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 bearish early today. Shorter-term resistance lies at the overnight high of 148 even and then at last week’s high of 148 9/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at 147 16/32 and then at 147 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5June U.S. T-Notes: Prices are weaker early today on profit taking after hitting a contract high on Friday. Bulls still have good 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 neutral to bearish early today. Shorter-term resistance lies at the overnight high of 133.05.5 and then at Friday’s contract high of 133.11.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 132.29.0 and then at Friday’s low of 132.20.5. 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 higher in early U.S. trading. The greenback bulls have the overall near-term technical advantage but did fade on Friday. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 82.910 and then at 83.010. Shorter-term support is seen at 82.500 and then at last week’s low of 82.310. Wyckoff’s Intra Day Market Rating: 5.0

NYMEX CRUDE OIL

Crude oil prices are higher early today on short covering following strong selling pressure last week. Bears still have some downside technical momentum. In May Nymex crude, look for buy stops to reside just above resistance at $94.00 and then at $94.50. Look for sell stops just below technical support at $93.00 and then at the overnight low of $92.71. Wyckoff’s Intra-Day Market Rating: 5.5

GRAINS

Markets were higher overnight on short covering from recent strong selling pressure. Wet, cool weather in the U.S. Midwest is starting to support the bullish camp in corn. Cold weather in the U.S. Plains states is also supporting buying interest in wheat futures early this week. Traders are awaiting Wednesday’s release of the latest monthly USDA monthly supply and demand report.