Friday, August 2–Jim Wyckoff’s Morning Web Log
NOTE: After 28 years of living in Cedar Falls, Iowa, my wife and I have moved to western Iowa. The moving process started on Wednesday. My friend and fellow market analyst Ken Seehusen will produce my reports while I’m busy moving. I’ll be back at work full throttle next Monday morning.–Jim
The STOCK INDEXES
The September NASDAQ 100 was higher overnight as it extends the rally off last week’s low. This morning’s jobs and unemployment reports for July will set the tone and likely direction of the trading into early August. Stochastics and the RSI are diverging but are bullish signaling that sideways to higher prices are possible near-term. If September extends this year’s rally, monthly resistance crossing at 3329.82 is the next upside target. Closes below the 20-day moving average crossing at 3053.30 would confirm that a short-term top has been posted. First resistance is Thursday’s high crossing at 3123.50. Second resistance is monthly resistance crossing at 3329.82. First support is the 20-day moving average crossing at 3053.30. Second support is last Tuesday’s low crossing at 3023.50.
The September S&P 500 was higher overnight as it extends Thursday’s rally into uncharted territory. Stochastics and the RSI are diverging but are also turning neutral to bullish signaling that additional short-term gains are possible near-term. If September extends the rally off June’s low, upside targets will be hard to project with September trading into uncharted territory. Closes below the 20-day moving average crossing at 1677.36 are needed to confirm that a short-term top has been posted. First resistance is the overnight high crossing at 1703.40. First support is the 20-day moving average crossing at 1677.36. Second support is the reaction low crossing at 1670.50.
INTEREST RATES
September T-bonds were lower in overnight trading as they Thursday’s decline below July’s low. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. If September extends the decline off July’s high, weekly support crossing at 130-24 is the next downside target. Closes above the 20-day moving average crossing at 134-04 would confirm that a short-term low has been posted. First resistance is the 20-day moving average crossing at 134-04. Second resistance is the reaction high crossing at 136-00. First support is the overnight low crossing at 131-26. Second support is weekly support crossing at 130-24.
ENERGY MARKETS
September Nymex crude oil was lower in late overnight trading after falling short of testing July’s high crossing at 108.93. Stochastics and the RSI have turned bullish signaling that sideways to higher prices are possible near-term. Closes above July’s high would renew this summer’s rally off April’s low. Closes below Tuesday’s low crossing at 102.67 would confirm that a double top with July’s high has been posted. First resistance is July ’s high crossing at 108.93. Second resistance is monthly resistance crossing at 110.55. First support is the 25% retracement level of the April-July rally crossing at 103.27. Second support is the 38% retracement level of the April-July rally crossing at 100.27.
CURRENCIES
The September Dollar was higher overnight as it extends this week’s rebound off the 75% retracement level of the June-July rally crossing at 81.70. Stochastics and the RSI are oversold but are turning bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing at 82.72 would confirm that a short-term low has been posted. If September renews the decline off July’s high, the 87% retracement level of the June-July rally crossing at 81.15 is the next downside target. First resistance is the 20-day moving average crossing at 82.72. Second resistance is the reaction high crossing at 83.16. First support is the 75% retracement level of the June-July rally crossing at 81.70. Second support is the 87% retracement level of the June-July rally crossing at 81.15.
GRAINS
December corn was lower overnight as it extends this summer’s decline. Non-threatening weather forecast for much of the Midwest along with chances for scattered showers across portions of the region will continue to keep pressure on the market ahead of the August crop production report. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If December extends the decline off June’s high, weekly support crossing at 4.33 1/2 is the next downside target. Closes above the 20-day moving average crossing at 4.93 3/4 are needed to confirm that a short-term low has been posted. First resistance is the 10-day moving average crossing at 4.78. Second resistance is the 20-day moving average crossing at 4.93 3/4. First support is weekly support crossing at 4.66 3/4. Second support is weekly support crossing at4.33 1/2.
December wheat was fractionally lower overnight. Upside potential appears limited ahead of August’s supply-demand report. The low-range close sets the stage for a steady to lower opening when the day session begins trading. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If December renews the decline off July’s high, psychological support crossing at 6.50 is the next downside target. First resistance is Thursday’s high crossing at 6.79 3/4. Second resistance is July’s high crossing at 7.05 3/4. First support is last Thursday’s low crossing at 6.58 1/4. Second support is psychological support crossing at 6.50.
November soybeans were higher due to short covering overnight as they consolidate some of this week’s losses. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If November extends the aforementioned decline, April’s low crossing at 11.86 1/2 is the next downside target. Closes above the 20-day moving average crossing at 12.50 1/2 are needed to confirm that a short-term low has been posted. First resistance is the 10-day moving average crossing at 12.27 1/2. Second resistance is the 20-day moving average crossing at 12.50 1/2. First support is Thursday’s low crossing at 11.89. Second support is April’s low crossing at 11.86 1/2.
