NOTE: I am out of the office this week. My friend and fellow market analyst Ken Seehusen will produce my reports. I’ll be back at work full throttle next Monday morning. Happy New Year!–JimThe STOCK INDEXES
The March NASDAQ 100 was steady to slightly lower overnight as it extends Thursday’s decline. Stochastics and the RSI are overbought and are turning neutral to bearish hinting that a short-term top might be in or is near. Closes below the 20-day moving average crossing at 3519.35 are needed to confirm that a short-term top has been posted and would then open the door for additional weakness near-term. If March renews 2013’s rally, monthly resistance crossing at 3668.00 is the next upside target. First resistance is Tuesday’s high crossing at 3594.75. Second resistance is monthly resistance crossing at 3668.00. First support is the 20-day moving average crossing at 3519.35. Second support is December’s low crossing at 3415.25.
The March S&P 500 was steady to slightly higher due to light short covering overnight as it consolidated some of Thursday’s loss. However, stochastics and the RSI are overbought and are turning neutral to bearish hinting that a short-term top might be in or is near. Closes below the 20-day moving average crossing at 1805.81 would confirm that a short-term top has been posted. If March renews 2013’s rally into uncharted territory, upside targets will be hard to project. First resistance is Tuesday’s high crossing at 1846.50. Second resistance is unknown. First support is the 20-day moving average crossing at 1805.81. Second support is December’s low crossing at 1755.00.
March T-bonds were lower overnight. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If March extends the decline off October’s high, weekly support crossing at 125-29 is the next downside target. Closes above the 20-day moving average crossing at 129-04 are needed to confirm that a short-term low has been posted. First resistance is the 20-day moving average crossing at 129-04. Second resistance is the reaction high crossing at 130-11. First support is Tuesday’s low crossing at 127-23. Second support is weekly support crossing at 125-29.
ENERGY MARKETS
February Nymex crude oil was lower overnight as it extends Thursday’s sharp decline. Thursday’s sharp decline was due to concerns domestic crude-oil supplies are due to increase this month, as production remains high. Traders recognizes that most of the crude oil draws we’ve seen over the last month or so has really been for accounting or tax reasons. Analysts are expecting the Energy Information Administration to report a 2.2-million-barrel decline in crude-oil stocks for the week ended Dec. 27, according to a Wall Street Journal survey. The EIA is expected to release its report Friday at 11 a.m. EST. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. If February extends this week’s decline, November’s low crossing at 92.10 is the next downside target. Closes above the 10-day moving average crossing at 98.49 would confirm that a short-term low has been posted. First resistance is the 10-day moving average crossing at 98.49. Second resistance is last Friday’s high crossing at 100.75. First support is the overnight low crossing at 95.13. Second support is November’s low crossing at 92.10.
CURRENCIES
The March Dollar was slightly lower overnight as it consolidates some of Thursday’s rally. Stochastics and the RSI are turning neutral to bullish signaling that sideways to higher prices are possible near-term. If March renews the rally off December’s low, November’s high crossing at 81.73 is the next upside target. If March renews the decline off last week’s high, the reaction low crossing at 79.50 is the next downside target. First resistance is December’s high crossing at 81.18. Second resistance is November’s high crossing at 81.73. First support is December’s low crossing at 79.50. Second support is October’s low crossing at 79.35.
GRAINS
March corn was fractionally higher due to short covering overnight as it consolidates some of the decline off last week’s high. The mid-range close sets the stage for a steady to higher opening when the day session begins trading. Stochastics and the RSI are oversold but remain bearish signaling that sideways to lower prices are possible near-term. Closes below key support marked by December’s low crossing at 4.18 1/2 would renew 2013’s decline while opening the door for a possible test of weekly support crossing at 3.99 3/4 later this winter. Closes above the reaction high crossing at 4.36 are needed to confirm that a short-term low has been posted. Closes above December’s high crossing at 4.40 3/4 are needed to confirm that a seasonal low has been posted. First resistance is the reaction high crossing at 4.36. Second resistance is December’s high crossing at 4.40 3/4. First support is December’s low crossing at 4.18 1/2. Second support is weekly support crossing at 3.99 3/4.
March wheat was steady to fractionally higher overnight as it consolidates some of Thursday’s decline. The low-range close sets the stage for a steady to lower opening when the day session begins trading. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If March extends the decline off October’s high, weekly support crossing at 5.92 1/2 is the next downside target. Closes above the 20-day moving average crossing at 6.20 1/4 would confirm that a short-term low has been posted. First resistance is the 10-day moving average crossing at 6.05 1/2. Second resistance is the 20-day moving average crossing at 6.20 1/4. First support is Thursday’s low crossing at 5.95 1/2. Second support is weekly support crossing at 5.92 1/2.
March soybeans were higher due to short covering overnight as it consolidated some of this week’s decline. The low-range close sets the stage for a steady to lower opening when the day session begins trading. Stochastics and the RSI are becoming oversold but remain bearish signaling that sideways to lower prices are possible near-term. If March extends this week’s decline, the reaction low crossing at 12.56 1/4 is the next downside target. Closes above the 20-day moving average crossing at 13.12 1/2 are needed to confirm that a short-term low has been posted. First resistance is the 20-day moving average crossing at 13.12 1/2. Second resistance is December’s high crossing at 13.39 1/4. First support is Thursday’s low crossing at 12.62 1/2. Second resistance is the reaction low crossing at 12.56 1/4.
