* LATEST MARKET DEVELOPMENTS *
Trader and investor risk appetite has come back into the market place late this week. The situation in Ukraine has for now moved from a serious geopolitical matter to more of a regional issue of less significance—from a market place perspective. This has been bullish for world stock markets and bearish for safe-haven gold, the U.S. dollar and U.S. Treasuries.
The monthly monetary policy meeting from the European Central Bank is Thursday. The ECB is not expected to make any significant monetary policy moves, given some recent, generally upbeat economic data coming out of the European Union. As always, the press conference by ECB president Mario Draghi will draw close scrutiny from traders and investors.
The big economic report of the week is the U.S. employment report on Friday morning. The forecast is for the key non-farm payrolls figure of the jobs data to come in at up 150,000 in February. Any reading that deviates significantly from that forecast is likely to move the markets. In recent weeks, U.S. economic data has mostly missed the pre-report forecasts and have been on the weak side of those forecasts.
U.S. economic data due for Thursday includes the weekly jobless claims report, the Challenger job cuts report, manufacturers’ shipments and inventories, and ICSC chain store sales trends.
Wyckoff’s Daily Risk Rating: 6.0 (The Ukraine situation has de-escalated—for now.)
(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 futures: Prices are firmer in early U.S. trading today and hit another record high overnight. The bulls have the solid overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Today, shorter-term technical resistance comes in at the overnight record high of 1,877.40 and then at 1,885.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,871.40 and then at 1,850.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 6.0
Nasdaq index futures: Prices are slightly higher early today and hit another 13.5-year high overnight. The shorter-term moving averages (4- 9-and 18-day) are bullish early today. 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 to bullish early today. Shorter-term technical resistance is located at the overnight high of 3,735.00 and then at 3,750.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at Wednesday’s low of 3,712.50 and then at 3,700.00. 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 and hovering near a six-week high. Bulls have the overall near-term technical advantage. Buy stops likely reside just above technical resistance at this week’s high of 16,405 and then at 16,450. Sell stops likely reside just below technical support at Wednesday’s low of 16,330 and then at 16,300. Shorter-term moving averages are bullish early today, as the 4-day moving average is above the 9-day and 18-day. The 9-day moving average is above the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are neutral early today. Wyckoff’s Intra-Day Market Rating: 6.0
U.S. TREASURY BONDS AND NOTES
June U.S. T-Bonds: Prices are weaker early today. Bulls are fading amid the increase in investor risk appetite late this week. 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. 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 132 13/32 and then at Wednesday’s high of 132 21/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at 132 even and then at 131 24/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5 June U.S. T-Notes: Prices are lower early today as the bulls are fading. Shorter-term moving averages (4- 9- 18-day) are still bullish early today. The 4-day moving average is above 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 124.10.5 and then at Wednesday’s high of 126.14.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at this week’s low of 124.02.0 and then at 124.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
U.S. DOLLAR INDEX
The June U.S. dollar index is near steady early today. Prices are in a five-week-old downtrend on the daily bar chart. Slow stochastics for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at this week’s high of 80.415 and then at 80.500. Shorter-term support is seen at the overnight low of 80.165 and then at Tuesday’s low of 80.080. Wyckoff’s Intra Day Market Rating: 5.0
NYMEX CRUDE OIL
April Nymex crude oil prices are modestly lower early today and hit a three-week low on more profit taking. Bulls still have the overall near-term technical advantage but are fading quickly. A steep two-month-old uptrend on the daily bar chart has been negated. In April Nymex crude, look for buy stops to reside just above resistance at the overnight high of $101.43 and then at $102.00. Look for sell stops just below technical support at $100.50 and then at $100.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Markets were mixed overnight. On tap Thursday is the weekly USDA export sales report. The Ukraine matter has played out in the grain markets, unless the situation escalates. The grain market bulls still have near-term technical momentum on their side, to suggest prices can work sideways or sideways to higher. Focus will soon turn to the U.S. planting season and any potential planting delays due to cold weather in the central U.S.
