Monday, October 27–Jim Wyckoff’s Morning Web Log
OVERNIGHT/EARLY MORNING DEVELOPMENTS
The market features again in overnight/early morning trading today are lower U.S. stock index futures prices and a stronger U.S. dollar.
* JIM’S MARKET THOUGHT OF THE DAY *
Price trends in the currency futures tend to be generally stronger and longer-lasting than price trends in other markets. This fact has been reinforced in recent weeks. Would-be top pickers in the greenback and bottom pickers in the other major currencies need to beware. It’s generally not good trading judgement to catch a falling knife or stand in front of a freight train and try to pick bottoms or tops in markets. Better is to wait for a market to show a solid technical clue its price trend is reversing.–Jim
U.S. STOCK INDEXES
The U.S. stock indexes are sharply lower in early morning trading as the bears still have the solid near-term technical advantage, amid no clues that market bottoms are close at hand.
December S&P 500: 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 is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical support comes in at the overnight contract low of 825.00 and then at 800.00. Sell stops likely reside just under those levels. Upside resistance for active traders today is located at 865.00 and then at the overnight high of 885.10. Buy stops are likely located just above those levels. Wyckoff’s Intra-day Market Rating: 2.0
Today’s key near-term Fibonacci support/resistance level: 890.00.
PIVOT POINT LEVELS FOR DECEMBER S&P 500:
Pivot:————- 872.50
1st Support:——– 828.50
2nd Support:——– 791.00
1st Resistance:—– 910.00
2nd Resistance:—– 954.00
December Nasdaq Index: Prices hit a fresh contract low overnight. 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 bearish early today. Shorter-term technical support is located at the overnight contract low of 1,138.00. Sell stops likely reside just below that level, and then more sell stops are likely located just below technical support at 1,100.00. On the upside, short-term resistance is seen at 1,200.00 and then at the overnight high of 1,214.75. Buy stops are likely located just above those levels. Wyckoff’s Intra-Day Market Rating: 2.0
Today’s key near-term Fibonacci support/resistance level: 1,223.00
PIVOT POINT LEVELS FOR DECEMBER NASDAQ:
Pivot:———— 1,201.50
1st Support:—— 1,150.00
2nd Support:—— 1,108.50
1st Resistance:— 1,243.00
2nd Resistance:— 1,294.50
December Dow: Sell stops likely reside just below support at 8,000 and then more stops just below support at 7,900. Buy stops likely reside just above shorter-term technical resistance at 8,200 and then just above resistance at 8,400. Shorter-term moving averages are bearish early today, as the 4-day moving average is below the 9-day. The 9-day moving average is below the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are bearish early today. Wyckoff’s Intra-Day Market Rating: 2.0
Today’s key near-term Fibonacci support/resistance level: 8,447
PIVOT POINT LEVELS FOR DECEMBER DOW:
Pivot:———— 8,297
1st Support:—— 8,039
2nd Support:—— 7,817
1st Resistance:— 8,519
2nd Resistance:— 8,777
U.S. TREASURY BONDS AND NOTES
U.S. T-Bonds and T-Notes futures prices are higher early today, amid the stock market declines overnight. Bulls have regained upside near-term technical momentum.
December U.S. T-Bonds: Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical support lies at 117 16/32 and then at 117 even. Sell stops likely reside just below those levels. Shorter-term technical resistance lies at 118 even and then at 118 16/32. Buy stops likely reside just above those levels. Wyckoff’s Intra-Day Market Rating: 6.5
Today’s key near-term Fibonacci support/resistance level: 117 5/32
PIVOT POINT LEVELS FOR DECEMBER T-BONDS:
Pivot:———– 117 29/32
1st Support:—– 115 28/32
2nd Support:—– 114 26/32
1st Resistance:– 118 31/32
2nd Resistance:– 121 even
December U.S. T-Notes: Shorter-term oscillators (RSI, slow stochastics) are bullish early today. Buy stops likely reside just above shorter-term technical resistance at the overnight high of 115.30.0 and then at last week’s high of 116.16.0. Shorter-term moving averages are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Sell stop orders are likely located just below support at 115.16.0 and then at the overnight low of 115.00.0. Wyckoff’s Intra Day Market Rating: 6.5
Today’s key near-term Fibonacci support/resistance level: 116.11.0
PIVOT POINT LEVELS FOR DECEMBER T-NOTES:
Pivot:———– 115 16/32
1st Support:—– 114 16/32
2nd Support:—– 113 28/32
1st Resistance:– 116 4/32
2nd Resistance:– 117 4/32
CURRENCIES
The December U.S. dollar index is solidly higher in early trading today and hit another fresh contract and two-year high overnight. Bulls are still very strong. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at the overnight and the contract high of 88.31 and then at 88.50. Shorter-term support is seen at 87.50 and then at 87.00. Today’s key near-term Fibonacci support/resistance level: 87.04. Wyckoff’s Intra Day Market Rating: 8.0
The December Euro is solidly lower in early electronic trading and hit another fresh contract low overnight. Euro finds sell stop orders are likely located just below technical support at the overnight contract low of 1.2327 and then just below support at 1.2250. Shorter-term technical resistance for the Euro is seen at 1.2500 and then at 1.2550. Buy stops likely reside just above those levels. Slow stochastics for the Euro are neutral early today. Today’s key near-term Fibonacci support/resistance level: 1.2777. Wyckoff’s Intra Day Market Rating: 2.0
GOLD
Gold is lower in early dealings today. For December gold, shorter-term technical resistance is seen at $739.80 and then at $750.00. Buy stops likely reside just above those levels. Sell stops likely reside just below support at the overnight low of $707.00 and then at $700.00. Today’s key near-term Fibonacci support/resistance level: $717.00. Wyckoff’s Intra-Day Market Rating: 4.0
CRUDE OIL
Crude oil prices are lower early today and hit a fresh 22-month low overnight. In December crude, look for buy stops to reside just above resistance at $63.00 and then just above resistance at 64.00. Look for sell stops just below technical support at $61.00 and then more sell stops just below support at $60.00. Today’s key near-term Fibonacci support/resistance level: $67.00. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
Prices were lower in overnight trading, amid bearish “outside markets–a stronger U.S. dollar and lower crude oil prices. Grain market bears still have the near-term technical advantage amid worldwide economic recession fears. I still believe corn is at or close the point where prices will be viewed as a bargain buy. That’s not yet the case with beans and wheat, and especially wheat, in my opinion.
