Jim's Morning Markets Report--Jan. 22

January 22, 2014 12:36 AM
 

Wednesday, January 22--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

In overnight news, reports said investor demand for a
Spanish 10-year note was strong Wednesday. This follows good
demand for sovereign bonds issued by Ireland and Portugal.
Less than two years ago these European Union nations were on
the verge of financial collapse. It is remarkable how
investor sentiment has changed since then. This news
continues a trend of upbeat economic data coming out of the
EU.

The Bank of Japan kept its monetary policy unchanged at its
latest meeting that ended Wednesday. The BOJ has embarked on
a very stimulative monetary policy that aims to get yearly
inflation up to 2% in two years. Japan has been wracked by
deflationary price pressures for many years.

U.S. economic data due for release Wednesday is light and
includes the weekly MBA mortgage applications survey, and
the weekly Goldman Sachs and Johnson Redbook retail sales
reports.

Wyckoff’s Daily Risk Rating: 5.0 (There is no major U.S.
economic data out Wednesday, and the world geopolitical
front is quiet.)

(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 near steady in early U.S.
trading and hovering not far below the recent record high.
Bulls remain in firm command. The shorter-term moving
averages (4-, 9- and 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. Short-term oscillators (RSI, slow
stochastics) are neutral early today. Today, shorter-term
technical resistance comes in at the record 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 Tuesday’s low of 1,827.20 and then at 1,817.50.
Sell stops are likely located just below those levels.
Wyckoff's Intra-day Market Rating: 5.0

Nasdaq index futures: Prices are near steady early today and
hit another 14-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. 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 the overnight high of 3,621.00 and
then at 3,635.00. Buy stops likely reside just above those
levels. On the downside, short-term support is seen at
3,600.00 and then at Tuesday’s low of 3,577.50. Sell stops
are likely located just below those levels. Wyckoff's Intra-
Day Market Rating: 5.5.

Dow futures: Prices are weaker in early U.S. trading. Bulls
are still in overall technical control. Buy stops likely
reside just above technical resistance at 16,355 and then at
16,400. Sell stops likely reside just below technical
support at 16,300 and then at Tuesday’s low of 16,255.
Shorter-term moving averages are neutral early today, as the
4-day moving average is above the 9-day. The 9-day moving
average is below the 18-day moving average. Shorter-term
oscillators (RSI, slow stochastics) are neutral early today.
Wyckoff's Intra-Day Market Rating: 4.5

U.S. TREASURY BONDS AND NOTES

March U.S. T-Bonds: Prices are weaker early today on profit
taking after hitting a two-month high Tuesday. The bulls
have gained some upside near-term technical momentum
recently. 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 neutral to bearish
early today. Shorter-term resistance lies at the overnight
high of 131 14/32 and then at Tuesday’s high of 131 20/32.
Buy stops likely reside just above those levels. Shorter-
term technical support lies at Tuesday’s low of 130 27/32
and then at 130 16/32. Sell stops likely reside just below
those levels. Wyckoff's Intra-Day Market Rating: 4.5
 
March U.S. T-Notes: Prices are lower early today. Bears
have the overall near-term technical advantage. 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 neutral to bearish early today.
Shorter-term resistance lies at the overnight high of
124.12.0 and then at Tuesday’s high of 124.18.5. Buy stops
likely reside just above those levels. Shorter-term
technical support lies at Tuesday’s low of 124.00.0 and
then at 123.24.0. Sell stops likely reside just below those
levels. Wyckoff's Intra-Day Market Rating: 4.0

U.S. DOLLAR INDEX

The March U.S. dollar index is slightly lower early today.
Bulls still have some upside near-term technical momentum as
prices are in a four-week-old uptrend on the daily chart.
Slow stochastics for the dollar index are bearish early
today. The dollar index finds shorter-term technical
resistance at the overnight high of 81.335 and then at
Tuesday’s high of 81.525. Shorter-term support is seen at
the overnight low of 81.130 and then at 81.000. Wyckoff's
Intra Day Market Rating: 5.0

NYMEX CRUDE OIL

March Nymex crude oil prices are firmer early today and hit
a two-week high on short covering. Bulls have gained some
upside near-term technical momentum recently. Bears do still
have the overall near-term technical advantage. In March
Nymex crude, look for buy stops to reside just above
resistance at the overnight high of $95.71 and then at
$96.00. Look for sell stops just below technical support at
$95.00 and then at $94.50. Wyckoff's Intra-Day Market
Rating: 5.5

GRAINS

Markets were mixed to firmer overnight. Soybean bulls have
faded badly amid beneficial rains and cooler temperatures
reported in Argentina soybean regions this week. Corn bulls
are also very weak amid a lack of fresh, bullish news. Wheat
bears remain in full technical command amid slack export
demand for U.S. wheat. The demand side of the equation for
grains will continue to be a major market factor in the
grain markets. Grain market bulls are also worried about the
seasonal "February Break" phenomenon that seems to pressure
the grain futures markets about this time every year.
 

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