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RSS By: Jim Wyckoff, Pro Farmer

Pro Farmer technical analyst Jim Wyckoff's daily thoughts.

JIm's Morning Markets Report--February 3

Feb 03, 2012

Friday, February 3--Jim Wyckoff's Morning Web Log

Note: I am out of the office this morning. My friend and fellow analyst/trader Ken
Seehusen produced my morning report. Ken's style is a bit different than mine, but I think
you'll also benefit from Ken's work.--Jim

The STOCK INDEXES

The March NASDAQ 100 was higher in overnight trading and posted its
highest level since February 2001. Traders are hoping that employment
data due for release at 8:30 a.m. est. will show that U.S. employment
grew by 140,000 in January after rising 200,000 in December, while the
jobless rate held at an almost three-year low of 8.5 percent, according
to Bloomberg surveys of economists. Stochastics and the RSI are
overbought but remain neutral to bullish signaling that sideways to
higher prices are possible near-term. If March extends the rally off
December’s low, weekly resistance crossing at 2647.50 is the next upside
target. Closes below the 20-day moving average crossing at 2424.93 are
needed to confirm that a short-term top has been posted. First
resistance is the overnight high crossing at 2501.25. Second resistance
is weekly resistance crossing at 2647.50. First support is the 10-day
moving average crossing at 2464.70. Second support is the 20-day moving
average crossing at 2424.93.

The March S&P 500 index was higher in overnight trading as it extends
this week’s rally. The high-range close sets the stage for a steady to
higher opening when the day session begins trading. Stochastics and the
RSI are diverging but have turned bullish again signaling that
additional short-term gains are possible. If March extends the rally off
December’s low, the reaction high crossing at 1331.40 is the next upside
target. Closes below the 20-day moving average crossing at 1303.64 are
needed to confirm that a short-term top has been posted. First
resistance is last Thursday’s high crossing at 1329.50. Second
resistance is the reaction high crossing at 1331.40. First support is
the 20-day moving average crossing at 1303.64. Second support is the
reaction low crossing at 1272.70.

INTEREST RATES

March T-bonds were slightly higher in quiet overnight trading. The high-
range close sets the stage for a steady to higher opening when the day
session begins trading later this morning. Stochastics and the RSI are
overbought but remain neutral to bullish signaling that sideways to
higher prices are possible near-term. If March extends this rally,
December’s high crossing at 146-11 is the next upside target. Closes
below the 10-day moving average crossing at 143-13 would temper the
near-term friendly outlook. From a broad perspective, March needs to
close above 146-11 or below 139-16 to confirm a breakout of a three-
month trading range and point the direction of the next trending move.
First resistance is Tuesday’s high crossing at 145-15. Second resistance
is December’s high crossing at 146-11. First support is the 10-day
moving average crossing at 143-13. Second support is last Monday’s low
crossing at 140-21.

ENERGY MARKETS

March crude oil was higher in overnight trading as it consolidated some
of this week’s decline ahead of this morning’s employment report. Brent
crude’s premium to the New York price is set for the largest weekly gain
in a month. Stochastics and the RSI are oversold but remain neutral to
bearish signaling that sideways to lower prices are possible near-term.
If March extends the decline off January’s high, December’s low crossing
at 92.95 is the next downside target. Closes above Tuesday’s high
crossing at 101.29 would confirm that a short-term low has been posted.
First resistance is the 10-day moving average crossing at 98.51. Second
resistance is Tuesday’s high crossing at 101.29. First support is
Thursday’s low crossing at 95.44. Second support is December’s low
crossing at 92.95.

CURRENCIES

The March Dollar was lower overnight as it consolidates below the 38%
retracement level of the August-January rally crossing at 79.17.
Stochastics and the RSI are oversold but remain neutral to bearish
signaling that sideways to lower prices are possible near-term. If March
extends the decline off January’s high, the 50% retracement level of the
August-January rally crossing at 78.28 is the next downside target.
Closes above the 20-day moving average crossing at 80.29 would temper
the near-term bearish outlook. First resistance is the 10-day moving
average crossing at 79.39. Second resistance is the 20-day moving
average crossing at 80.29. First support is Wednesday’s low crossing at
78.74. Second support is the 50% retracement level of the August-January
rally crossing at 78.28.

GRAINS

March corn was higher in overnight trading but remains below
psychological resistance crossing at 6.50. Light overnight support came
from Thursday’s export sales, which were above pre-report estimates at
38.4 million bushels. Tight farmer holding of last year’s corn crop
continues to keep basis levels strong. If March can sustain closes above
the 100-day moving average crossing at 6.39, the door would be open for
a test of January’s high crossing at 6.64 1/4 later this winter. Closes
above the early-January high of 6.64 1/4 would open the door for a
larger-degree rally this winter. Stochastics and the RSI remain bullish
signaling that sideways to higher prices are possible near-term. Closes
below the 20-day moving average crossing at 6.29 1/4 would temper the
near-term friendly outlook and could lead to a setback into February’s
monthly supply-demand report. First resistance is Wednesday’s high
crossing at 6.50. Second resistance is January’s high crossing at 6.64
1/4. First support is the 20-day moving average crossing at 6.29 1/4.
Second support is January’s low crossing at 5.92 1/2.

March wheat was higher in overnight trading as it consolidates some of
the Thursday’s decline. Stochastics and the RSI are overbought but
remain neutral to bullish signaling that sideways to higher prices are
possible near-term. If March extends the overnight rally, the 38%
retracement level of the 2011-decline crossing at 7.36 3/4 is March’s
next upside target. Closes below the 20-day moving average crossing at
6.34 would confirm that a short-term top has been posted. First
resistance is Wednesday’s high crossing at 6.83 3/4. Second resistance
is the 38% retracement level of the 2011-decline crossing at 7.36 3/4.
First support is the 10-day moving average crossing at 6.51 1/4. Second
support is the 20-day moving average crossing at 6.34.

March soybeans were higher in overnight trading as it extends the
rebound off Tuesday’s low. Stochastics and the RSI have turned bullish
signaling that sideways to higher prices are possible near-term. If
March renews the rally off January’s low, the 38% retracement level of
the August-December decline crossing at 12.46 1/2 is the next upside
target. Closes below Tuesday’s low crossing at 11.84 1/4 would open the
door for a possible test of January’s low crossing at 11.50 later this
winter. First resistance is the reaction high crossing at 12.37. Second
resistance is the 38% retracement level of the August-December decline
crossing at 12.46 1/2. First support is Tuesday’s low crossing at 11.84
1/4. Second support is January’s low crossing at 11.50.

 

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