*OVERNIGHT DEVELOPMENTS*

Traders and investors are still digesting Friday morning’s upbeat September U.S. employment report that showed a significantly higher-than-expected non-farm payrolls rise of 248,000. Traders expected the key figure to have risen by around 215,000 in September. The U.S. jobless rate also fell to 5.9%, which is the lowest since July of 2008. The jobs report helped pull the U.S. stock indexes out of a swoon last week.

European stocks were slightly supported Monday from the better U.S. jobs report on Friday. However, a weak German factory orders report issued Monday limited the upside in European stocks. The factory orders index fell 5.7% month-on-month—the steepest fall since early 2009.

The U.S. dollar index is hovering near last week’s four-year high hit following the jobs data. The stronger greenback has been a major bearish “outside market” force working against the raw commodity sector recently. Gold prices fell to a nine-month low overnight, before posting a modest rebound. Crude oil prices last week hit a multi-month low.

The pro-democracy demonstrations in Hong Kong are still simmering in the market place. The sense of traders is that the situation has not worsened but has not improved, either. Any escalation of the conflict could quickly put the matter back on the front burner and usher in keener risk aversion in the market place.

U.S. economic data due for release Monday is light and includes the employment trends index.

Wyckoff’s Daily Risk Rating: 6.0 (The pro-democracy protesting in Hong Kong has not gone away but has not escalated, either.)

(Wyckoff’s Daily Risk Rating is your way to quickly gauge investor risk appetite in the world market place each day. Each day I assess the “risk-on” or “risk-off” trader mentality in the market place with a numerical reading of 1 to 10, with 1 being least risk-averse (most risk-on) and 10 being the most risk-averse (risk-off), and 5 being neutral.

–Jim Wyckoff

U.S. STOCK INDEXES

S&P 500 December e-mini futures: Prices are firmer in early trading, on a corrective bounce after hitting a seven-week low last Thursday. Bulls are trying to recover from a near-term price downtrend. The shorter-term moving averages (4-, 9- and 18-day) are still 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 bullish early today. Today, shorter-term technical resistance comes in at the overnight high of 1,970.50 and then at last week’s high of 1,978.25. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,960.00 and then at 1,950.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5

Nasdaq index futures: Prices are higher in early trading today. Bulls are regaining some momentum. Shorter-term moving averages (4- 9-and 18-day) are still 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 bullish early today. Shorter-term technical resistance is seen at 4,050.00 and then at 4,075.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 4,025.00 and then at 4,000.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0.

Dow futures: Prices are higher in early U.S. trading, on a good rebound after hitting a six-week low last Thursday. Buy stops likely reside just above technical resistance at 17,000 and then at 17,050. Sell stops likely reside just below technical support at 16,950 and then at 16,900. 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 to bullish early today. Wyckoff’s Intra-Day Market Rating: 6.0

U.S. TREASURY BONDS AND NOTES

December U.S. T-Bonds: Prices are slightly higher early today. Bulls still have the firm overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at 139 16/32 and then at last week’s high of 140 1/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at 139 even and then at 138 19/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5 December U.S. T-Notes: Prices are firmer in early trading. Bulls still have the overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at the overnight high of 125.10.5 and then at Friday’s high of 125.13.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 125.03.5 and then at 125.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5

U.S. DOLLAR INDEX

The December U.S. dollar index is lower in early trading and seeing profit taking from recent solid gains. Prices are not far below last week’s contract and four-year high. Bulls have the solid overall near-term technical advantage. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at Friday’s contract high of 86.870 and then at 87.000. Shorter-term support is seen at 86.335 and then at 86.000. Wyckoff’s Intra Day Market Rating: 4.0

NYMEX CRUDE OIL

November Nymex crude oil prices are firmer early today on short covering following last Thursday’s spike to an 8.5-month low. Bears are still in firm overall technical control. Look for buy stops to reside just above technical resistance at $91.00 and then at Friday’s high of $91.79. Look for sell stops just below technical support at $90.00 and then at the overnight low of $89.39. Wyckoff’s Intra-Day Market Rating: 5.5

GRAINS

Markets were higher in overnight trading on short covering. Recent rains have halted harvest work in some of the Corn Belt. Frost in the far northern Corn Belt over the weekend is also a mildly bullish factor for the grains. However, the markets are not far above their contract lows and bears remain in full technical command. Focus is starting to shift to the growing season for corn and soybeans in South America.