Jim's Morning Markets Report--March 13

March 13, 2014 01:43 AM
 

Thursday, March 13--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

There was another downbeat economic report coming out of
China Thursday. China’s industrial output rose by 8.6%,
year-on-year, in the January and February period. That’s
lower than the 9.5% rise that was expected and down from a
rise of 9.7% in December. While the above numbers are
considered by the market place to be a "miss," most other
industrialized nations would love to have economic readings
like that. What the market place is noticing is that the
rate of economic growth in China is gradually easing.
Traders and investors are also a bit concerned about China’s
credit and financial system, given the recent bond default
by a Chinese corporation—the first one ever. Gold has seen
safe-haven buying due to the uncertainty of the
aforementioned matters in China.

The U.S. dollar index fell to a 4.5-month low overnight,
which also is an underlying bullish factor for the precious
metals.

The Russian troop occupation of Ukraine is still a concern
among traders and investors. U.S. and European Union leaders
are threatening to impose economic and diplomatic sanctions
on Russia. Meantime, Russia said it will do the same to the
U.S. and EU. A referendum from Crimean citizens on secession
is scheduled for Sunday, and that could be the next
flashpoint in the region. It would not be surprising to see
keener risk-aversion in the market place on Friday, heading
into an uncertain weekend for Ukraine. The Russian
occupation of Crimea has also been a bullish factor for the
gold market.

U.S. economic data due for release Thursday includes the
weekly jobless claims report, import and export price
indexes, manufacturing and trade inventories, and retail
sales.

Wyckoff’s Daily Risk Rating: 7.0 (The Ukraine situation
remains a significant geopolitical risk in the market place,
while China’s economic and financial conditions are also a
worry.)

(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
today. The bulls still have the overall near-term technical
advantage. 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 overnight high of
1,874.50 and then at this week’s high of 1,881.80. Buy stops
likely reside just above those levels. Downside support for
active traders today is located at the overnight low of
1,867.00 and then at this week’s low of 1,854.20. 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. The
shorter-term moving averages (4- 9-and 18-day) are neutral
early today. The 4-day moving average is below 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 3,722.00 and then at last week’s high of
3,737.25. Buy stops likely reside just above those levels.
On the downside, short-term support is seen at 3,700.00 and
then at 3,675.00. 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. Buy
stops likely reside just above technical resistance at
16,400 and then at this week’s high of 16,450. Sell stops
likely reside just below technical support at 16,300 and
then at this week’s low of 16,260. Shorter-term moving
averages are still 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 to bearish
early today. Wyckoff's Intra-Day Market Rating: 5.5

U.S. TREASURY BONDS AND NOTES

June U.S. T-Bonds: Prices are slightly lower early today.
Shorter-term moving averages (4- 9- 18-day) are neutral
early today. The 4-day moving average is below the 9-day and
18-day. The 9-day is even with the 18-day moving average.
Oscillators (RSI, slow stochastics) are neutral to bullish
early today. Shorter-term resistance lies at this week’s
high of 132 12/32 and then at 132 21/32. Buy stops likely
reside just above those levels. Shorter-term technical
support lies at the overnight low of 131 29/32 and then at
131 16/32. Sell stops likely reside just below those levels.
Wyckoff's Intra-Day Market Rating: 4.5
 
June 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
and 18-day. The 9-day is below the 18-day moving average.
Oscillators (RSI, slow stochastics) are neutral to bullish
early today. Shorter-term resistance lies at the overnight
high of 124.04.0 and then at this week’s high of 124.07.0.
Buy stops likely reside just above those levels. Shorter-
term technical support lies at the overnight low of
123.29.0 and then at Wednesday’s low of 123.22.0. Sell
stops likely reside just below those levels. Wyckoff's
Intra-Day Market Rating: 4.5

U.S. DOLLAR INDEX

The June U.S. dollar index is solidly lower in early
trading. Prices hit a fresh contract low overnight. Prices
are in a six-week-old downtrend on the daily bar chart.
Bears are in firm technical command. Slow stochastics for
the dollar index are neutral early today. The dollar index
finds shorter-term technical resistance at 79.590 and then
at the overnight high of 79.745. Shorter-term support is
seen at the overnight contract low of 79.375 and then at
79.250. Wyckoff's Intra Day Market Rating: 3.0

NYMEX CRUDE OIL

April Nymex crude oil prices are firmer on short covering
after hitting a five-week low on Wednesday. The bears have
the overall near-term technical advantage. In April Nymex
crude, look for buy stops to reside just above resistance at
$99.00 and then at Wednesday’s high of $99.60. Look for sell
stops just below technical support at $98.00 and then at
this week’s low of $97.55. Wyckoff's Intra-Day Market
Rating: 5.5

GRAINS

Markets were mostly firmer overnight. The grain market bulls
have the overall near-term technical advantage, but the
soybean bulls have faded and need to show fresh power soon.
Wheat is now leading the corn market, which is not common.
Focus is on these things, at present: export demand for U.S.
grains, the Ukraine unrest, poor U.S. HRW wheat conditions,
and the upcoming U.S. planting season and any potential
planting delays due to cold weather in the central U.S.
 

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