Friday, October 17–Jim Wyckoff’s Morning Web Log
OVERNIGHT/EARLY MORNING DEVELOPMENTS
The market features in overnight/early morning trading today are lower U.S. stock index futures prices and firmer crude oil prices.
* JIM’S MARKET THOUGHT OF THE DAY *
Crude oil prices hit a fresh 13-month low on Thursday and dropped below $70.00 a barrel. Now, this market appears headed for longer-term trendline support at the $60.00 a barrel level, or below. It’s remarkable that crude oil prices have dropped 50% in less than four months. That fact does argue for the case that commodity markets had become a huge speculative bubble that has been popped.–Jim
U.S. STOCK INDEXES
The U.S. stock indexes are lower in early morning trading, on a corrective pullback following big gains Thursday. Bears still have the overall near-term technical advantage.
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 neutral to bearish early today. Today, shorter-term technical support comes in at the overnight low of 908.00 and then at 900.00. Sell stops likely reside just under those levels. Upside resistance for active traders today is located at the overnight high of 955.00 and then at 975.00. Buy stops are likely located just above those levels. Wyckoff’s Intra-day Market Rating: 4.0
Today’s key near-term Fibonacci support/resistance level: 928.00.
PIVOT POINT LEVELS FOR DECEMBER S&P 500:
Pivot:————- 918.85
1st Support:——– 887.70
2nd Support:——– 834.35
1st Resistance:—– 972.20
2nd Resistance:— 1,003.35
December Nasdaq Index: The shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical support is located at the overnight low of 1,270.00. Sell stops likely reside just below that level, and then more sell stops are likely located just below technical support at 1,250.00. On the upside, short-term resistance is seen at the overnight high of 1,330.00 and then at 1,350.00. Buy stops are likely located just above those levels. Wyckoff’s Intra-Day Market Rating: 4.0
Today’s key near-term Fibonacci support/resistance level: 1,309.00
PIVOT POINT LEVELS FOR DECEMBER NASDAQ:
Pivot:———— 1,281.00
1st Support:—— 1,232.00
2nd Support:—— 1,141.00
1st Resistance:— 1,372.00
2nd Resistance:— 1,421.00
December Dow: Sell stops likely reside just below support at 8,800 and then more stops just below support at 8,700. Buy stops likely reside just above shorter-term technical resistance at 8,900 and then just above resistance at 9,000. 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 neutral early today. Wyckoff’s Intra-Day Market Rating: 4.0
Today’s key near-term Fibonacci support/resistance level: 8,644
PIVOT POINT LEVELS FOR DECEMBER DOW:
Pivot:———— 8,722
1st Support:—— 8,444
2nd Support:—— 7,922
1st Resistance:— 9,244
2nd Resistance:— 9,522
U.S. TREASURY BONDS AND NOTES
U.S. T-Bonds and T-Notes futures prices are narrowly mixed early today. Recent big downside price action has produced serious near-term chart damage, amid ideas the worst of the financial crisis is over. Bears still have the near-term technical advantage.
December U.S. T-Bonds: Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance lies at the overnight high of 114 10/32 and then at Thursday’s high of 114 29/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 113 21/32 and then at this week’s low of 113 8/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
Today’s key near-term Fibonacci support/resistance level: 114 30/32
PIVOT POINT LEVELS FOR DECEMBER T-BONDS:
Pivot:———– 114 20/32
1st Support:—– 113 1/32
2nd Support:—– 112 12/32
1st Resistance:– 114 20/32
2nd Resistance:– 115 18/32
December U.S. T-Notes: Shorter-term oscillators (RSI, slow stochastics) are neutral early today. Buy stops likely reside just above shorter-term technical resistance at the overnight high of 112.16.5 and then at Thursday’s high of 112.25.0. Shorter-term moving averages are bearish early today. The 4-day moving average is below 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 the overnight low of 112.02.0 and then at this week’s low of 111.12.5. Wyckoff’s Intra Day Market Rating: 4.5
Today’s key near-term Fibonacci support/resistance level: 114.02.0
PIVOT POINT LEVELS FOR DECEMBER T-NOTES:
Pivot:———– 112 3/32
1st Support:—– 111 13/32
2nd Support:—– 110 22/32
1st Resistance:– 112 26/32
2nd Resistance:– 113 16/32
CURRENCIES
The December U.S. dollar index is firmer in early trading today. Slow stochastics for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at contract high of 83.50 and then at 83.75. Shorter-term support is seen at the overnight low of 82.42 and then at 82.00. Today’s key near-term Fibonacci support/resistance level: 82.03. Wyckoff’s Intra Day Market Rating: 6.0
The December Euro is slightly lower in early electronic trading. Euro finds sell stop orders are likely located just below technical support at this week’s low of 1.3341 and then just below support at the October low of 1.3280. Shorter-term technical resistance for the Euro is seen at the overnight high of 1.3512 and then at 1.3600. Buy stops likely reside just above those levels. Slow stochastics for the Euro are bearish early today. Today’s key near-term Fibonacci support/resistance level: 1.3560. Wyckoff’s Intra Day Market Rating: 4.5
GOLD
Gold is lower in early dealings today. For December gold, shorter-term technical resistance is seen at $800.00 and then at the overnight high of $816.90. Buy stops likely reside just above those levels. Sell stops likely reside just below support at the overnight low of $790.00 and then at this week’s low of $786.70. Today’s key near-term Fibonacci support/resistance level: $815.00. Wyckoff’s Intra-Day Market Rating: 4.0
CRUDE OIL
Crude oil prices are firmer early today. In November crude, look for buy stops to reside just above resistance at the overnight high of $73.02 and then just above resistance at 74.00. Look for sell stops just below technical support at $70.00 and then more sell stops just below support at $69.00. Today’s key near-term Fibonacci support/resistance level: $74.74. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Prices were firmer in overnight trading, on short covering. This week’s price action suggests the bears still have some near-term technical strength. If the key “outside markets” remain bearishly postured, then the path of least resistance for the grains will continue to be sideways to lower in the very near term. However, my bias is still that corn and soybeans will put in “harvest lows” in the next few weeks, or sooner.
