Jim's Morning Markets Report--May 2

May 2, 2013 01:59 AM
 

Thursday, May 2--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

Traders and investors were awaiting the outcome of the
European Central Bank meeting Thursday to discuss EU
monetary policy. Many had expected the ECB to cut its key
interest rate by 0.25%, to 0.5%, which is precisely what the
ECB did Thursday. Recent weak EU economic data made the case
for such action. Just Thursday it was reported that Euro
zone manufacturing activity in April declined. The Markit
manufacturing gauge came in at 46.7 in April compared to
46.8 in March. A number below 50 indicates a month-to-month
decline in manufacturing activity. Traders and investors
will also be scrutinizing comments from ECB president Mario
Draghi at this monthly press conference following the ECB
meeting. In Asian news overnight, the HSBC China
manufacturing PMI came in at 50.4 in April versus 51.6 in
March. This reading follows the official China government
PMI reported Wednesday, which was also down from the
previous month. The weakening China PMI data this week has
been a bearish weight on the raw commodity sector, including
the precious metals, as it suggests less demand from the
world’s largest consumer of raw commodities. U.S. economic
data due for release Thursday includes the weekly jobless
claims report, the Challenger job cuts report, the
international trade report, the New York ISM report on
business, and the global manufacturing PMI.--Jim

U.S. STOCK INDEXES

S&P 500 futures: Prices are firmer early today. Bulls have
the solid 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
Wednesday’s high of 1,595.40 and then at 1,610.00. Buy stops
likely reside just above those levels. Downside support for
active traders today is located this week’s low of 1,574.50
and then at 1,560.00. Sell stops are likely located just
below those levels. Wyckoff's Intra-day Market Rating: 5.5

Nasdaq index futures: Prices are firmer early today. Bulls
have the solid 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 average is above the 18-day. Short-term
oscillators (RSI, slow stochastics) are neutral early today.
Shorter-term technical resistance is located at Wednesday’s
high of 2,887.00 and then at 2,900.00. Buy stops likely
reside just above those levels. On the downside, short-term
support is seen at Wednesday’s low of 2,862.25 and then at
Tuesday’s low of 2,853.25. Sell stops are likely located
just below those levels. Wyckoff's Intra-Day Market Rating:
5.5.

Dow futures: Prices are firmer early today. Bulls have the
solid overall near-term technical advantage. Buy stops
likely reside just above technical resistance at 14,700 and
then at Wednesday’s high of 14,743. Sell stops likely reside
just below technical support at Wednesday’s low of 14,630
and then at 14,600. 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

June U.S. T-Bonds: Prices are slightly lower early today.
Bulls still have the solid overall 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 and 18-day. The 9-day is above the 18-day moving
average. Oscillators (RSI, slow stochastics) are neutral
early today. Shorter-term resistance lies at the overnight
high of 149 12/32 and then at the contract high of 149
23/32. Buy stops likely reside just above those levels.
Shorter-term technical support lies at the overnight low of
148 30/32 and then at this week’s low of 148 9/32. Sell
stops likely reside just below those levels. Wyckoff's
Intra-Day Market Rating: 5.0
 
June U.S. T-Notes: Prices are near steady early today after
hitting a contract high Wednesday. Bulls have the solid
overall 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 and 18-day. The 9-day is
above the 18-day moving average. Oscillators (RSI, slow
stochastics) are neutral early today. Shorter-term
resistance lies at the contract high of 133.25.0 and then
at 134.00.0. Buy stops likely reside just above those
levels. Shorter-term technical support lies at 133.16.0 and
then at 133.08.0. Sell stops likely reside just below those
levels. Wyckoff's Intra-Day Market Rating: 5.0

U.S. DOLLAR INDEX

The U.S. dollar index is higher in early U.S. trading and is
seeing a corrective bounce after prices hit a nine-week low
on Wednesday. The bulls have faded badly recently. Slow
stochastics for the dollar index are bearish early today.
The dollar index finds shorter-term technical resistance at
the overnight high of 81.830 and then at 82.000. Shorter-
term support is seen at the overnight low of 81.640 and then
at Wednesday’s low of 81.370. Wyckoff's Intra Day Market
Rating: 6.0

NYMEX CRUDE OIL

Crude oil prices are firmer early today on a corrective
bounce from this week’s strong selling pressure. Bears still
have some downside momentum on their side. In June Nymex
crude, look for buy stops to reside just above resistance at
$92.00 and then at $92.50. Look for sell stops just below
technical support at $91.00 and then at the overnight low of
$90.65. Wyckoff's Intra-Day Market Rating: 5.5

GRAINS

Markets were higher in overnight trading, on a corrective
rebound from selling pressure seen Wednesday. Rains and
cold temperatures in the forecast for the U.S. Corn Belt in
the coming days are bullish for corn, which in turn is the
leader of the grains complex, at present. Wheat bulls still
have some upside near-term technical momentum on their
side. The U.S. hard red winter wheat crop is in bad shape.
Meantime, light farmer selling in the U.S. cash market
supports soybean futures prices. Grain traders will closely
examine Thursday morning’s weekly USDA grain export sales
report.
 

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