Jim's Morning Markets Report--Feb. 24

February 24, 2014 12:53 AM
 

Monday, February 24--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

The Ukrainian president was ousted during the weekend and is
now in hiding. The situation there remains very fluid. If
that situation sees violence escalate, more risk aversion
would enter the market place. The Ukrainian developments and
some civil unrest and violence in Thailand are prompting
increased safe-haven demand for gold.

There was a Group of 20 economic and finance ministers
meeting in Sydney, Australia, during the weekend. The group
laid out a plan for the major industrial economies to
continue with their aggressive monetary stimulus plans,
while at the same time called for the emerging countries to
restructure their economies to contain inflation. The
proclamation was mostly ignored by world markets.

Asian and European stock markets were pressured Monday in
part on reports Chinese banks have ratcheted back lending to
commercial property developers. Traders and investors have
become more concerned about slowing economic growth in China
the past few months. China is the world’s second-largest
economy and the world’s largest consumer of raw commodities.

In other news overnight, the European Union saw its consumer
price index fall at the largest rate since EU records began
in 2001—down 1.1% in January, month-on-month. This report
intensifies worries about deflationary price pressures in
the European Union and puts more pressure on the European
Central Bank to add more monetary stimulus. There was an
upbeat German Ifo business confidence report released
Monday.

U.S. economic data due for release Monday includes the
Chicago Fed national activity index and the Texas
manufacturing outlook survey.

Wyckoff’s Daily Risk Rating: 6.0 (The violence in Ukraine
and now Thailand is keeping some increased risk in the
market place.)

(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
   
U.S. STOCK INDEXES

S&P 500 futures: Prices are firmer in early U.S. trading.
The bulls still have the solid overall near-term technical
advantage as prices hover not far below the record high. 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 early
today. Today, shorter-term technical resistance comes in at
the all-time high of 1,846.50 and then at 1,850.00. Buy
stops likely reside just above those levels. Downside
support for active traders today is located at the overnight
low of 1,830.00 and then at last week’s low of 1,817.60.
Sell stops are likely located just below those levels.
Wyckoff's Intra-day Market Rating: 5.5

Nasdaq index futures: Prices are higher early today. Bulls
have upside near-term technical momentum as prices hover
near a 13.5-year high. 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 early today. Shorter-term technical
resistance is located at last week’s high of 3,686.75 and
then at 3,700.00. Buy stops likely reside just above those
levels. On the downside, short-term support is seen at the
overnight low of 3,655.00 and then at last week’s low of
3,638.25. Sell stops are likely located just below those
levels. Wyckoff's Intra-Day Market Rating: 6.0.

Dow futures: Prices are firmer in early U.S. trading. Bulls
have the overall near-term technical advantage. Buy stops
likely reside just above technical resistance at 16,150 and
then at last week’s high of 16,195. Sell stops likely reside
just below technical support at Friday’s low of 16,080 and
then at 16,000. 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: 5.5

U.S. TREASURY BONDS AND NOTES

March U.S. T-Bonds: Prices are slightly firmer early today.
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 neutral early today. Shorter-
term resistance lies at the overnight high of 133 10/32 and
then at 133 15/32. Buy stops likely reside just above those
levels. Shorter-term technical support lies at the overnight
low of 133 even and then at 132 20/32. Sell stops likely
reside just below those levels. Wyckoff's Intra-Day Market
Rating: 5.5
 
March U.S. T-Notes: Prices are slightly lower early today.
Shorter-term moving averages (4- 9- 18-day) are bearish
early today. The 4-day moving average is below the 9-day.
The 9-day is below the 18-day moving average. Oscillators
(RSI, slow stochastics) are neutral to bearish early today.
Shorter-term resistance lies at the overnight high of
125.24.0 and then at 126.00.0. Buy stops likely reside just
above those levels. Shorter-term technical support lies at
last week’s low of 125.08.5 and then at the February low of
125.03.0. Sell stops likely reside just below those levels.
Wyckoff's Intra-Day Market Rating: 4.5

U.S. DOLLAR INDEX

The March U.S. dollar index is slightly higher early today
on more short covering. Slow stochastics for the dollar
index are bullish early today. The dollar index finds
shorter-term technical resistance at last week’s high of
80.465 and then at 80.600. Shorter-term support is seen at
the overnight low of 80.125 and then at last week’s low of
79.950. Wyckoff's Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

April Nymex crude oil prices are near steady early today.
Bulls still have near-term technical momentum. A steep
seven-week-old uptrend is in place on the daily bar chart. A
bull flag has also formed on the daily chart. In April Nymex
crude, look for buy stops to reside just above resistance at
the overnight high of $102.70 and then at the contract high
of $103.29. Look for sell stops just below technical support
at $102.00 and then at Friday’s low of $101.69. Wyckoff's
Intra-Day Market Rating: 5.5

GRAINS

Markets were mixed overnight—soybeans higher and corn wheat
weaker. Hot and dry weather late in the growing season in
South America is hurting the soybean crop there. Grain
market bulls still have some upside technical momentum.
Traders are awaiting Monday morning’s USDA weekly export
inspections report.
 

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