Jim's Morning Markets Report--Nov. 11

November 11, 2013 01:06 AM
 

Monday, November 11--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

The Armistice and Veterans Day holidays in Europe and the
U.S. Monday have squelched market activity. The U.S.
government is closed on Monday and no U.S. economic data is
due for release.

The market place is still digesting Friday’s U.S. employment
report for October, which showed a surprisingly larger-than-
expected 204,000 rise in non-farm payroll employment. That
number was expected to have grown by only around 120,000.
The jobs report fell into the camp of U.S. monetary policy
hawks who want to see the Fed start to "taper" its monetary
policy sooner rather than later. This week’s U.S. economic
data will give traders and investors more guidance on the
present health of the U.S. economy and just when the Fed
might start to wind down its monthly bond-buying program.
The next Federal Open Market Committee (FOMC) monetary
policy meeting is held in December.

Last week’s U.S. economic data gave the U.S. dollar a boost
against its other currency rivals. The U.S. dollar index hit
a nearly two-month high last week. The stronger greenback is
a bearish underlying factor for the raw commodity sector.
That sector continues to be in an overall bear market.

Reports overnight said China’s industrial production data,
released during the weekend, showed a 10.3% rise in October,
year-on-year. Consumer inflation in China was reported up
3.2% in October, on an annual basis. This economic data is
an underlying bullish factor for the raw commodity sector,
as it suggests the world’s second-largest economy and a
voracious raw commodity importer is on a healthy economic
growth path.

Monday’s Wyckoff’s Daily Risk Rating: 5.0 (Monday setting up
to be a quiet and uneventful trading day, amid the U.S.
holiday.)

(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). Each morning I will
look at several markets and scan the world’s news headlines
to get a sense of how risk appetite in the market place will
shape for the trading day. For example, extreme readings in
my Daily Risk Rating would be a very bullish U.S. jobs
report that would fully cheer investors—Wyckoff’s Daily Risk
Rating would be 1. Conversely, a daily rating of 10 would be
an unexpected military confrontation in the Middle East that
included combat. Most days Wyckoff’s Daily Risk Rating will
be around neutral--between 4 and 6.)

--Jim
   
U.S. STOCK INDEXES

S&P 500 futures: Prices are near steady in early U.S.
trading. 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 last week’s record high of 1,774.20
and then at 1,785.00. Buy stops likely reside just above
those levels. Downside support for active traders today is
located at 1,750.00 and then at last week’s low of 1,736.30.
Sell stops are likely located just below those levels.
Wyckoff's Intra-day Market Rating: 5.5

Nasdaq index futures: Prices are slightly lower 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 bearish early today.
Shorter-term technical resistance is located at 3,375.00 and
then at 3,387.00. Buy stops likely reside just above those
levels. On the downside, short-term support is seen at
3,350.00 and then at 3,325.00. Sell stops are likely located
just below those levels. Wyckoff's Intra-Day Market Rating:
5.0.

Dow futures: Prices are slightly higher early today. Buy
stops likely reside just above technical resistance at last
week’s record high of 15,745 and then at 15,800. Sell stops
likely reside just below technical support at 15,650 and
then at 15,600. 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

December U.S. T-Bonds: Prices are slightly lower early today
and hit a fresh two-month low overnight. Friday’s stronger
U.S. jobs report sunk the bond market. 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 bearish early today. Shorter-term
resistance lies at the overnight high of 131 24/32 and then
at 132 even. Buy stops likely reside just above those
levels. Shorter-term technical support lies at the overnight
low of 131 16/32 and then at 131 even. Sell stops likely
reside just below those levels. Wyckoff's Intra-Day Market
Rating: 4.5
 
December U.S. T-Notes: Prices are near steady early today
and hovering near a four-week low. Shorter-term moving
averages (4- 9- 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. Oscillators (RSI, slow stochastics)
are neutral to bearish early today. Shorter-term resistance
lies at the overnight high of 126.08.5 and then at
126.16.0. Buy stops likely reside just above those levels.
Shorter-term technical support lies at Friday’s low of
125.30.5 and then at 125.24.0. Sell stops likely reside
just below those levels. Wyckoff's Intra-Day Market Rating:
5.0

U.S. DOLLAR INDEX

The December U.S. dollar index is weaker early today, on a
corrective pullback from recent strong gains. Bulls still
have some more upside momentum. Slow stochastics for the
dollar index are neutral early today. The dollar index finds
shorter-term technical resistance at the overnight high of
81.420 and then at last week’s high of 81.580. Shorter-term
support is seen at 81.000 and then at Friday’s low of
80.790. Wyckoff's Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

December Nymex crude oil prices are weaker early today and
hovering not far above last week’s four-month low. Bears
still have the overall near-term technical advantage. Prices
are in a 10-week-old downtrend on the daily bar chart. In
December Nymex crude, look for buy stops to reside just
above resistance at $95.00 and then at last week’s high of
$95.40. Look for sell stops just below technical support at
$94.00 and then at $93.50. Wyckoff's Intra-Day Market
Rating: 4.5

GRAINS

Markets were mixed overnight. Friday’s USDA monthly supply
and demand report did not turn out to be the bearish report
that many grain traders had reckoned it would be. The
upside price action in corn and soybeans Friday begins to
hint that seasonal harvest lows are in place. That’s also
my bias, especially for corn. With the U.S. corn and
soybean harvest winding down, focus of grain market traders
will turn from U.S. production to overall worldwide demand
for grains, and on the upcoming South American planting and
growing season.
 

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