Friday, March 8–Jim Wyckoff’s Morning Web Log

* LATEST MARKET DEVELOPMENTS *

The most important U.S. economic report of the month, the employment situation report for February, is due out Friday morning. The key non-farm payroll number is expected to come in at up 157,000, while the unemployment rate is forecast at 7.8%. Look for active trade in many markets in the immediate aftermath of the jobs report. In overnight news, China’s trade surplus in February was $15.25 billion from $29.15 billion in January. Forecasts had called for a $16 billion deficit. Strong Chinese exports were credited with the surprising trade surplus during the month. China releases industrial output, retail sales and inflation data during this weekend. German industrial production was weaker than expected in January, at unchanged from December’s 0.6% rise. A 0.4% rise was forecast for January. This follows Thursday report that German manufacturing orders dropped 1.9% in January, from December. European stock markets were firmer Friday, awaiting the U.S. jobs data for fresh direction. Other U.S. economic data due for release Friday includes monthly wholesale trade and the monthly USDA supply and demand report for major grains.–Jim

U.S. STOCK INDEXES

S&P 500 futures: Prices are firmer early yesterdayand hovering near a five-year high. The bulls have the solid overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are bullish early yesterday. 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 neutral early today. Today, shorter-term technical resistance comes in at 1,550.00 and then at 1,565.00. Buy stops likely reside just above those levels. Downside support for active traders yesterday is located at the overnight low of 1,535.60 and then at 1,524.60. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5

Nasdaq index futures: Prices are firmer in early trading and hovering near a five-month high. Bulls have the overall near-term technical advantage. The shorter-term moving averages (4- 9-and 18-day) are bullish early yesterday. 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 neutral early yesterday. Shorter-term technical resistance is located at this week’s high of 2,809.25 and then at 2,825.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 2,790.50 and then at 2,775.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.

DOW FUTURES

Prices are firmer early yesterday and hovering near this week’s all-time record high. The bulls have the solid overall near-term technical advantage. Sell stops likely reside just below technical support at 14,245 and then at 14,200. Buy stops likely reside just above technical resistance at 14,300 and then at Thursday’s record high of 14,332. Shorter-term moving averages are bullish early yesterday, 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 yesterday. Wyckoff’s Intra-Day Market Rating: 5.5

U.S. TREASURY BONDS AND NOTES

June U.S. T-Bonds: Prices are weaker early yesterday and hit a fresh three-week low overnight. Bulls have faded badly amid the rallying U.S. stock market and better investor risk appetite this week. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are bearish early yesterday. Shorter-term resistance lies at the overnight high of 142 even and then at 142 16/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 141 19/32 and then at 141 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0

June U.S. T-Notes: Prices are weaker early today and hit a two-week low overnight. Bulls have faded badly. Shorter-term moving averages (4- 9- 18-day) are neutral early yesterday. The 4-day moving average is below the 9-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 130.23.5 and then at 131.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 130.17.0 and then at 130.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0

U.S. DOLLAR INDEX

The U.S. dollar index is firmer early yesterday. The greenback bulls still have the near-term technical advantage as prices hover not far below this week’s six-month high. Slow stochastics for the dollar index are neutral early yesterday. The dollar index finds shorter-term technical resistance at this week’s high of 82.865 and then at 83.000. Shorter-term support is seen at the overnight low of 82.305 and then at 82.000. Wyckoff’s Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

Crude oil prices are slightly lower early yesterday. Prices are not that far above this week’s nine-week low. Bears still have the overall near-term technical advantage. In April Nymex crude, look for buy stops to reside just above resistance at this week’s high of $91.73 and then at $92.00. Look for sell stops just below technical support at $91.00 and then at Thursday’s low of $90.22. Wyckoff’s Intra-Day Market Rating: 4.5

GRAINS

Markets were mostly firmer overnight on more short covering. Traders will close scrutinize this morning’s USDA supply and demand report. Look for an active trading day in the grain futures today.