Jim's Morning Markets Report--March 27

March 27, 2014 02:01 AM
 

Thursday, March 27--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

The markets are still digesting news late Wednesday that
some U.S. and world banks, including Citi, failed a
government stress test due to inadequate capital plans.
Those banks will have to resubmit new capital plans to the
Federal Reserve. The news, while somewhat surprising, has
not rattled the market place.

The Russia-Ukraine tensions have not escalated significantly
recently, but the situation remains a concern to the world
market place. While the U.S. is leading a worldwide effort
to isolate Russia after its annexation of Crimea, reports
Thursday said Russian economic growth is set to slow to the
weakest rate in years. Foreign capital in Russia has seen a
mass exodus since the crisis emerged. Russia’s deteriorating
economy and world isolation will very likely only make
Russian president Vladimir Putin more defiant on the world
stage. Remember that the Russian military is still very
powerful and is still bristling with nuclear missiles. Put
another way, Russia could become the next North Korea—only
supersized. This entire matter is likely to become a longer-
term bullish underlying factor for safe-haven gold. Some are
now calling the present U.S.-Russia relations "Cold War
2.0."

Meantime, the IMF has agreed to loan Ukraine up to $18
billion to help out that nation’s struggling economy, after
the Russian incursion.

Reports this week say demand for physical gold from Asia
continues tepid.

U.S. economic data due out Thursday includes the weekly
jobless claims report, the third-quarter GDP estimate, the
Kansas City Fed manufacturing survey, and pending home
sales.

Wyckoff’s Daily Risk Rating: 6.0 (The Ukraine situation has
for the moment de-escalated but is still an unsettling
market factor.)

(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 have the overall near-term technical
advantage, but trading has turned choppy. The shorter-term
moving averages (4-, 9- and 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. Short-term oscillators
(RSI, slow stochastics) are neutral early today. Today,
shorter-term technical resistance comes in at 1,860.00 and
then at Wednesday’s high of 1,868.30. Buy stops likely
reside just above those levels. Downside support for active
traders today is located at this week’s low of 1,841.50 and
then at 1,832.00. 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 but
hovering near a six-week low. The shorter-term moving
averages (4- 9-and 18-day) are bearish early today. The 4-
day moving average is below the 9-day and 18-day. The 9-day
average is below the 18-day. Short-term oscillators (RSI,
slow stochastics) are neutral to bearish early today.
Shorter-term technical resistance is located at 3,600.00 and
then at 3,625.00. Buy stops likely reside just above those
levels. On the downside, short-term support is seen at this
week’s low of 3,570.75 and then at 3,550.00. Sell stops are
likely located just below those levels. Wyckoff's Intra-Day
Market Rating: 5.5.

Dow futures: Prices are firmer in early U.S. trading. Buy
stops likely reside just above technical resistance at
16,250 and then at 16,300. Sell stops likely reside just
below technical support at 16,200 and then at Wednesday’s
low of 16,175. 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: 5.5

U.S. TREASURY BONDS AND NOTES

June U.S. T-Bonds: Prices are near steady early today and
hovering near the recent highs. Bulls have the overall level
near-term technical advantage. Shorter-term moving averages
(4- 9- 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. Oscillators (RSI, slow stochastics) are
neutral to bullish early today. Shorter-term resistance lies
at the overnight high of 133 27/32 and then at the March
high of 134 1/32. Buy stops likely reside just above those
levels. Shorter-term technical support lies at the overnight
low of 134 16/32 and then at 133 even. Sell stops likely
reside just below those levels. Wyckoff's Intra-Day Market
Rating: 6.0
 
June U.S. T-Notes: Prices are weaker early today. Bears
have the overall near-term technical advantage. 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 early
today. Shorter-term resistance lies at this week’s high of
123.29.5 and then at 124.00.0. Buy stops likely reside just
above those levels. Shorter-term technical support lies at
123.16.0 and then at 123.09.0. Sell stops likely reside
just below those levels. Wyckoff's Intra-Day Market Rating:
4.0

U.S. DOLLAR INDEX

The June U.S. dollar index is firmer in early trading, on
short covering. Bears still have the overall near-term
technical advantage. However, a bullish pennant pattern has
formed on the daily bar chart. Slow stochastics for the
dollar index are neutral early today. The dollar index finds
shorter-term technical resistance at the overnight high of
80.315 and then at 80.400. Shorter-term support is seen at
the overnight low of 80.100 and then at 80.000. Wyckoff's
Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

May Nymex crude oil prices are higher in early U.S. trading
and hit a three-week high overnight. Bulls have upside
momentum. In May Nymex crude, look for buy stops to reside
just above resistance at $101.50 and then at $102.00. Look
for sell stops just below technical support at $100.00 and
then at $99.50. Wyckoff's Intra-Day Market Rating: 6.0

GRAINS

Markets were mixed but mostly firmer overnight on some more
chart consolidation. Traders will examine this morning’s
weekly USDA export sales report. Trading could be quieter
today and Friday as next Monday’s USDA planting intentions
report comes into view. It’s one of the most important USDA
reports of the year. The grain market bulls still have the
overall near-term technical advantage. The corn market is
seeing underlying support from worries about U.S. planting
delays. Soybeans are boosted by strong worldwide demand, and
the wheat market sees buying interest due to the poor
condition of the U.S. hard red winter crop.
 

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