NOTE: I’ve added key “Pivot Point” levels for the stock
indexes and Treasuries. If you’d like an explanation
of how these levels are derived, send me an email
and I’ll attach a feature on Pivot
OVERNIGHT/EARLY MORNING DEVELOPMENTS
There feature overnight and in early morning electronic
trading is a rebound in gold and crude oil prices. The
dollar is slightly higher versus the other major
currencies. T-Bonds and T-Notes are slightly higher and the
U.S. stock indexes are weaker in early electronic trading.
Grains were mostly higher in overnight electronic trading.
There was no fresh, major market-moving news overnight.
U.S. ECONOMIC REPORTS/EVENTS
On tap today is the ICSC store sales index, Redbook retail
sales, the Richmond Fed manufacturing index, the Consumer
Confidence Index, existing home sales and the Chicago Fed
midwest manufacturing index. Traders are keenly awaiting
Thursday’s FOMC meeting, in which it’s expected that U.S.
interest rates will be hiked again.
U.S. STOCK INDEXES
The indexes are weaker in early morning electronic trading.
Trading has become choppy recently. My bias is that trading
will be choppy in the near term, amid summertime doldrums
in the stock market. I don’t look for the recent lows to be
taken out any time soon.
September S&P 500: We’ve still seen a shorter-term
“collapse in volatility” in this market, which does suggest
a bigger price move is on the horizon. Price action
recently has also seen a wedge pattern from on the daily
bar chart. A breakout from that wedge could occur as soon
as today. The shorter-term moving averages (4-, 9- and 18-
day) are turning bearish. The 4-day moving average is
moving below the 9-day. The 9-day is still below the 18-day
moving average. Short-term oscillators are neutral today.
Today, key shorter-term technical support comes in at
1,253.20–Monday’s low. Sell stops likely reside just under
that level. Heavier sell stops likely reside under shorter-
term support at last week’s low of 1,247.30. Shorter-term
upside resistance for active traders today is at 1,261.20–
Monday’s high. Light buy stops are likely located just
above that price level, and more buy stops are likely
located just above shorter-term resistance at 1,264.00.
PIVOT POINT LEVELS FOR S&P 500:
1st Support:—— 1,255.20
2nd Support:—— 1,250.20
1st Resistance:— 1,263.20
2nd Resistance:— 1,266.20
September Nasdaq: The shorter-term moving averages (4- 9-
and 18-day) are turning bearish. The 4-day is moving below
the 9-day moving average. The 9-day moving average is still
below the 18-day. Short-term oscillators are neutral today.
Today, shorter-term technical support is located at last
week’s low of 1,560.00. Heavier sell stops likely reside
just below that level, and then below support at 1,555.00.
On the upside, short-term resistance is seen at Monday’s
high of 1,578.00. Buy stops are likely located just above
that level. More buy stops are likely located just above
last week’s high of 1,605.00.
PIVOT POINT LEVELS FOR NASDAQ:
1st Support:—— 1,562.75
2nd Support:—— 1,554.75
1st Resistance:— 1,578.50
2nd Resistance:— 1,586.25
September Dow: For today, sell stops likely reside just
below support at Monday’s low of 11,045 and then just below
support at 11,000. Buy stops likely reside just above
shorter-term technical resistance at 11,152 and then
heavier stops just above resistance at last week’s high of
11,210. Shorter-term moving averages are bullish, as the 4-
day moving average is above the 9-day and 18-day. The 9-day
is now pushing above the 18-day moving average. Shorter-
term oscillators (RSI, slow stochastics) are neutral to
PIVOT POINT LEVELS FOR DOW:
1st Support:—— 11,071
2nd Support:—— 11,116
1st Resistance:— 11,156
2nd Resistance:— 11,186
U.S. TREASURY BONDS AND NOTES
Both notes and bond prices were firmer in overnight trading
in Chicago. Short covering was featured after recent
losses. Bears still have the near-term technical momentum
on their side.
September U.S. T-Bonds: Prices Monday slipped to a fresh
five-week low. Shorter-term moving averages (4- 9- 18-day)
are still fully bearish. The 4-day moving average is below
the 9-day average and the 18-day. The 9-day is below the
18-day. Slow stochastics still show the market being way
short-term oversold and due for a corrective bounce very
soon. Shorter-term resistance lies at 106 7/32 and then at
106 15/32. Buy stops likely lie just above those levels.
Shorter-term technical support lies at Monday’s low of 105
14/32 and then solid support at the May low of 105 3/32.
Sell stops likely reside just below those levels, with
heavy stops likely just below the May low.
PIVOT POINT LEVELS FOR T-BONDS:
Pivot:———– 105 29/32
1st Support:—– 106 1/32
2nd Support:—– 105 17/32
1st Resistance:– 106 13/32
2nd Resistance:– 106 17/32
September U.S. T-Notes: Prices are firmer in early morning
dealings. Slow stochastics still show the market as still
being well oversold and due for a rebound very soon. Buy
stops likely reside just above shorter-term resistance at
104.15.5, and then just above resistance at 104.21.5.
Shorter-term moving averages are still fully bearish. The
4-day moving average is below the 9-day and 18-day average.
The 9-day is below the 18-day moving average. Sell stop
orders are likely located just below solid support at
Monday’s contract low of 104.01.5, and then just below
support at 103.24.0.
PIVOT POINT LEVELS FOR T-NOTES:
1st Support:—— 104.01.0
2nd Support:—— 103.31.0
1st Resistance:— 104.06.0
2nd Resistance:— 104.09.0