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Pro Farmer Tech Talk

RSS By: Jim Wyckoff, Pro Farmer

Pro Farmer technical analyst Jim Wyckoff's daily thoughts.

Jim's Morning Markets Report--Dec. 31

Dec 31, 2012

Monday, December 31--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

Markets were quieter overnight, on this last trading day of
the year, and ahead of the New Year’s Day holiday on
Tuesday. Most U.S. markets close early Monday. U.S. and
European stock markets were mixed to slightly higher
overnight amid the ongoing U.S. fiscal cliff saga. There was
no discernible progress during the weekend and it appears
the U.S. government will at least temporarily go over the
cliff. U.S. lawmakers need to reach a deal by January 3 to
avoid a series of tax increases and spending cuts that
automatically go into effect. While markets do not like the
uncertainty associated with the fiscal cliff, they have
become somewhat numb to the situation, as seen by the muted
market action seen overnight. In other overnight news, there
was some better Chinese manufacturing data released. The
HSBC purchasing managers index rose to 51.5 in December,
which is a 19-month high and was up from 50.5 seen in
November. U.S. economic data due for release Monday is light
and includes the Texas manufacturing outlook survey.--Jim

U.S. STOCK INDEXES

S&P 500 futures: Prices are slightly higher in early trading
today on some tepid short covering after prices Friday saw
solid losses that hit a five-week low and produced a
technically bearish weekly low close. Bears have downside
near-term technical momentum. The shorter-term moving
averages (4-, 9- and 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. Short-term oscillators
(RSI, slow stochastics) are neutral early today. Today,
shorter-term technical resistance comes in at the overnight
high of 1,392.00 and then at 1,400.00. Buy stops likely
reside just above those levels. Downside support for active
traders today is located at Friday’s low of 1,383.00 and
then at 1,375.00. Sell stops are likely located just below
those levels. Wyckoff's Intra-day Market Rating: 5.0

Nasdaq index futures: Prices are weaker early today and hit
a fresh five-week low overnight. Bears have fresh downside
near-term technical momentum. The shorter-term moving
averages (4- 9-and 18-day) are bearish early today. The 4-
day moving average is below the 9-day and 18-day. The 9-day
average is below the 18-day. Short-term oscillators (RSI,
slow stochastics) are bearish early today. Shorter-term
technical resistance is located at 2,600.00 and then at
2,615.00. Buy stops likely reside just above those levels.
On the downside, short-term support is seen at 2,575.00 and
then at 2,550.00. Sell stops are likely located just below
those levels. Wyckoff's Intra-Day Market Rating: 4.5

Dow futures: Prices near steady early today. Bears have
fresh downside near-term technical momentum after prices
Friday hit a fresh four-week low and closed at a technically
bearish weekly low close. Sell stops likely reside just
below technical support at 12,740 and then at 12,700. Buy
stops likely reside just above technical resistance at
12,800 and then at 12,850. Shorter-term moving averages are
bearish early today, as the 4-day moving average is below
the 9-day and 18-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: 4.5

U.S. TREASURY BONDS AND NOTES

March U.S. T-Bonds: Prices are firmer early today on some
more short covering and bargain hunting, and even some fresh
safe-haven demand. Bulls are recovering from recent losses
but have some more work to do. Shorter-term moving averages
(4- 9- 18-day) are neutral early today. The 4-day moving
average is above the 9-day. The 9-day is below the 18-day
moving average. Oscillators (RSI, slow stochastics) are
bullish early today. Shorter-term resistance lies at
Friday’s high of 148 25/32 and 149 even. Buy stops likely
reside just above those levels. Shorter-term technical
support lies at the overnight low of 148 5/32 and then at
148 even. Sell stops likely reside just below those levels.
Wyckoff's Intra-Day Market Rating: 5.5

March U.S. T-Notes: Prices are slightly higher early today.
Bulls are regaining upside momentum. Shorter-term moving
averages (4- 9- 18-day) are neutral early today. The 4-day
moving average is above the 9-day. The 9-day is below the
18-day moving average. Oscillators (RSI, slow stochastics)
are bullish early today. Shorter-term resistance lies at
Friday’s high of 133.02.5 and then at 133.08.0. Buy stops
likely reside just above those levels. Shorter-term
technical support lies at the overnight low of 132.24.5 and
then at 132.16.0. Sell stops likely reside just below those
levels. Wyckoff's Intra-Day Market Rating: 5.5

U.S. DOLLAR INDEX

The March U.S. dollar index is firmer in early U.S. trading,
on short covering in a bear market. Bears still have the
overall near-term technical advantage. Slow stochastics for
the dollar index are bullish early today. The dollar index
finds shorter-term technical resistance at Friday’s high of
80.05 and then at 80.25. Shorter-term support is seen at the
overnight low of 79.69 and then at last week’s low of 79.42.
Wyckoff's Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

Crude oil prices are weaker early today. Prices Friday hit a
nine-week high as the bulls still have some upside technical
momentum. In February Nymex crude, look for buy stops to
reside just above resistance at $91.00 and then at last
week’s high of $91.49. Look for sell stops just below
technical support at $89.50 and then at $89.00. Wyckoff's
Intra-Day Market Rating: 4.5

GRAINS

Markets were lower in overnight trading. The key “outside
markets” are in a bearish posture for the grains today, as
the U.S. dollar index is firmer and crude oil prices are
weaker. The grain market bulls have faded badly recently
and bears have some downside near-term technical momentum
on their side. Bullish news in the grains has been scarce
recently. However, it would not surprise me to see some
fresh speculative money enter the grain markets on the long
side as the new year gets under way.
 

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