* LATEST MARKET DEVELOPMENTS *
European and U.S. stock markets were pressured a bit overnight on a warning from the U.S. Treasury Secretary Geithner that the U.S. cannot skirt its debt ceiling, while the Fitch credit rating agency said it could downgrade the U.S.’s credit rating if the U.S. delays raising its debt ceiling. U.S. Federal Reserve Chairman Bernanke late Monday said the U.S. economic recovery is still fragile and strongly hinted that the Fed’s monthly bond-buying program will not end any time soon. That was a bullish development for the raw commodity markets. European Union economic data released Tuesday was a mixed bag. Germany’s GDP contracted by 0.5% in the fourth quarter of last year. However, Euro zone exports showed a record large trade surplus in November. There were also strong government bond sales in Italy and Spain, which is a clue that European investor sentiment toward the EU continues on the upswing. The Euro currency has been pushed to a multi-month high this week on the upbeat sentiment regarding the EU. The market place is awaiting Friday’s report from China on its fourth-quarter gross domestic product growth rate. U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the producer price index, retail sales, the Empire State manufacturing survey, and manufacturing and trade inventories.–Jim
U.S. STOCK INDEXES
S&P 500 futures: Prices are weaker in early trading today, on some profit taking after hitting a five-year high on Monday. Bulls still have upside near-term technical momentum. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 1,465.30 and then at Monday’s high of 1,471.30. Buy stops likely reside just above those levels. Downside support for active traders today is located at 1,450.00 and then at 1,446.20. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5
Nasdaq index futures: Prices are weaker early today after hitting a three-month high on Monday. Bulls still have the 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 and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is located at the overnight high of 2,732.25 and then at Monday’s high of 2,750.25. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 2,713.75 and then at 2,700.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
Dow futures: Prices are weaker early today on some profit taking from recent gains as prices hover near a three-month
high. Bulls still have some upside near-term technical momentum. Sell stops likely reside just below technical support at 13,380 and then at 13,325. Buy stops likely reside just above technical resistance at Monday’s high of 13,455 and then at 13,500. 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: 4.5
U.S. TREASURY BONDS AND NOTES
March U.S. T-Bonds: Prices are higher early today on more short covering and some bargain hunting. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term resistance lies at the overnight high of 146 5/32 and then at 146 10/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at 146 even and then at the overnight low of 145 17/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
March U.S. T-Notes: Prices are higher early today on short covering and bargain hunting. Shorter-term moving averages
(4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term resistance lies at 132.12.0 and then at 132.16.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at 132.08.0 and then at the overnight low of 132.01.0. 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 firmer early today on short covering in a bear market. Greenback bears still have some downside near-term technical momentum. Slow stochastics for the dollar index are bearish early today. The dollar index
finds shorter-term technical resistance at 79.93 and then at 80.00. Shorter-term support is seen at 79.50 and then at Monday’s low of 79.40. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
Crude oil prices are slightly lower early today, on some mild profit taking. Bulls still some upside momentum and have the overall near-term technical advantage. In February Nymex crude, look for buy stops to reside just above resistance at last week’s high of $94.70 and then at $95.00. Look for sell stops just below technical support at $93.00 and then at last week’s low of $92.42. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Markets were firmer overnight on more short covering and bargain hunting. Grain futures markets have shown decent upside price action just recently to give the bulls some hope. There are now some early technical clues the grain markets have put in near-term lows. However, the bulls have more work to do and need to prove themselves this week. This week’s price action will be extra important in the grain markets. Closes on Friday at or near the weekly highs
would be significantly bullish.