Jim's Morning Markets Report--June 24

June 24, 2013 01:48 AM
 

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

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

Overnight Developments

There is still some risk aversion in the market place to
start the new trading week. Asian and European stock markets
were lower Monday. There are worries about China’s economic
health and a potential credit crunch in the world’s second
largest economy. A major Chinese newspaper reported during
the weekend that China’s monetary authorities will not take
action to ease the tight credit situation at present. There
are also lingering effects of last week’s perceived hawkish
developments coming from the U.S. Federal Reserve’s latest
Open Market Committee meeting.

The U.S. dollar index is higher Monday morning on some
perceived safe-haven buying interest. Gold is under pressure
and prices are hovering near last week’s 2.5-year low. So
far, the yellow metal has seen very limited safe-haven
investment demand due to the risk aversion in the market
place, and instead has acted like a raw commodity risk
asset.

Meantime, U.S. Treasury bond and note yields continue to
rise, with the 10-year note reaching 2.63% Monday, which is
a two-year high. The Euro currency was stable on some better
economic data coming out of Germany. However, the other
currencies like the Canadian dollar and Australian dollar
were under pressure. Emerging market currencies continued
under pressure amid the keener "risk-off" trader attitudes
in the worldwide market place.

Nymex crude oil prices are slightly lower Monday on the
China economic growth concerns. The crude oil bears have
downside technical momentum.

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

The September NASDAQ 100 was lower overnight as it extends
the decline off May’s high. Stochastics and the RSI remain
bearish signaling that sideways to lower prices are possible
near-term. If September extends the aforementioned decline,
the 38% retracement level of the November-May rally crossing
at 2838.86 is the next downside target. Closes above the 20-
day moving average crossing at 2950.93 would confirm that a
short-term low has been posted. First resistance is the 10-
day moving average crossing at 2926.85. Second resistance is
the 20-day moving average crossing at 2950.93. First support
is the 38% retracement level of the November-May rally
crossing at 2838.86. Second support is the 50% retracement
level of the November-May rally crossing at 2774.87.

The September S&P 500 was lower overnight as it extends the
decline off May’s high. Stochastics and the RSI are bearish
signaling that sideway to lower prices are possible near-
term. If September extends this month’s decline, the 38%
retracement level of the November-May rally crossing at
1545.59 is the next downside target. Closes above the 20-day
moving average crossing at 1621.02 are needed to confirm
that a short-term low has been posted. First resistance is
the 20-day moving average crossing at 1621.02. Second
resistance is last Wednesday’s high crossing at 1648.70.
First support is the overnight low crossing at 1570.20.
Second support is the 38% retracement level of the November-
May rally crossing at 1545.59.

September T-bonds were lower overnight as they extend the
decline off May’s high. Stochastics and the RSI are oversold
but remain bearish signaling that additional weakness is
possible near-term. If September extends the decline off
May’s high, weekly support crossing at 130-24 is the next
downside target. Closes above the 20-day moving average
crossing at 139-05 are needed to confirm that a short-term
low has been posted. First resistance is the 10-day moving
average crossing at 138-02. Second resistance is the 20-day
moving average crossing at 139-05. First support is the
overnight low crossing at 133-19. Second support is weekly
support crossing at 130-24.

August Nymex crude oil was slightly lower overnight as it
extends this month ’s rally. Stochastics and the RSI are
bearish signaling that sideways to lower prices are possible
near-term. If August extends this month’s rally, June’s low
crossing at 91.50 is the next downside target. Closes above
the 10-day moving average crossing at 96.43 would confirm
that a short-term low has been posted. First resistance is
the 20-day moving average crossing at 95.36. Second
resistance is the 10-day moving average crossing at 96.43.
First support is the 50% retracement level of the April-June
rally crossing at 92.77. Second support is June’s low
crossing at 91.50.

The September Dollar was higher overnight as it extends the
rally off the 75% retracement level of the February-May
rally crossing at 80.81.Stochastics and the RSI are bullish
signaling that sideways to higher prices are possible near-
term. If September extends last week’s rally, the reaction
high crossing at 83.26 is the next upside target. Closes
below the 10-day moving average crossing at 81.50 would
confirm that a short-term top has been posted. First
resistance is the reaction high crossing at 83.26. Second
resistance is the reaction high crossing at 84.73. First
support is the 10-day moving average crossing at 81.50.
Second support is the 75% retracement level of the February-
May rally crossing at 80.81.

GRAINS

July corn was lower overnight as it extends last Friday’s
decline. Stochastics and the RSI are overbought and have
turned bearish signaling that sideways to lower prices are
possible near-term. Closes below the 20-day moving average
crossing at 6.61 1/4 would confirm that a short-term top has
been posted while opening the door for additional weakness
near-term. If July renews the rally off April’s low, the 38%
retracement level of the August-April decline crossing at
6.91 1/2 is the next upside target. First resistance is last
Wednesday’s high crossing at 6.83 1/2. Second resistance is
the 38% retracement level of the August-April decline
crossing at 6.91 1/2. First support is the 20-day moving
average crossing at 6.61 1/4. Second support is the reaction
low crossing at 6.40 1/2.

July wheat was lower due to profit taking overnight as it
consolidates some of last week’s rally. The low-range close
sets the stage for a steady to lower opening when the day
session begins trading. Stochastics and the RSI are neutral
to bullish signaling that sideways to higher prices are
possible near-term. If July extends last week’s rally,
June’s high crossing at 7.14 1/2 is the next upside target.
If July renews the decline off June’s high, April’s low
crossing at 6.64 3/4 is the next downside target. July wheat
needs to close above 7.40 1/2 or below 6.64 3/4 to confirm a
breakout of this spring’s trading range and point the
direction of the next trending move. First resistance is the
reaction high crossing at 7.14 1/2. Second resistance is the
reaction high crossing at 7.27 3/4. First support is May’s
low crossing at 6.74. Second support is April’s low crossing
at 6.64 3/4.

July soybeans were lower overnight as it extends the decline
off June’s high. Stochastics and the RSI remain bearish
signaling that sideways to lower prices are possible near-
term. If July extends this month’s decline, the reaction low
crossing at 14.71 1/4 is the next downside target. Closes
above the 20-day moving average crossing at 15.15 1/2 would
temper the near-term bearish outlook. First resistance is
the 20-day moving average crossing at 15.15 1/2. Second
resistance is June’s high crossing at 15.58 3/4. First
support is the overnight low crossing at 14.85 1/2. Second
support is the reaction low crossing at 14.71 1/4.


 

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