Jim's Morning Markets Report--Nov. 22

November 22, 2013 12:51 AM
 

Friday, November 22--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

In overnight news, the Euro currency was given a modest
boost by some upbeat economic data coming out of leading EU
economic power Germany. The Ifo business confidence index
rose to 109.3 in November, beating expectations for a
reading of 107.7.

The Japanese yen weakened to a multi-year low against
several currencies overnight, on ideas the Bank of Japan
will continue to ease its already very easy monetary policy.
A BOJ official said Friday the central bank will continue to
work toward getting inflation at a 2% annual rate.

The past few months the market place has appeared to be
consumed by "taper talk," regarding just when the U.S.
Federal Reserve will or will not make its long-anticipated
move to cut back on its monthly bond-buying program, also
called quantitative easing. The precious metals and other
markets have been impacted by when the precise timing of
such a move may occur. Generally, the market place has seen
a mostly bullish reaction to any news that suggests it may
take longer for the Fed to start tapering its monetary
policy. I got a note from a gold market watcher Thursday
saying he hopes the Fed starts to taper right away—get it
over with. His reasoning: Such would put a top in the stock
markets and money coming out of stocks would flow into other
asset classes, including precious metals. I cannot disagree
with his premise. The world’s major economies are awash in
cash seeking the best returns. At present, the vast majority
of traders and investors view the stock market as the best
game in town for investment returns. When too many people
get on one side of the boat, we all know what happens--and
history shows it, too. I don’t know precisely when the stock
market bubble will burst, but history shows it will. My bias
is that it will be sooner rather than later. When money
starts moving away from the stock market, the bulls in other
asset classes will be licking their chops.

U.S. economic data due for release Friday includes the
Kansas City Fed business survey and the manufacturing
activity index.

Wyckoff’s Daily Risk Rating: 6.0 (The market place does not
have much news headline risk at present, but the weekend
could find new developments come Monday morning—thus the
slight uptick in the risk rating today.)

(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).

--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 still 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 Monday’s record high of 1,799.50 and
then at 1,810.00. Buy stops likely reside just above those
levels. Downside support for active traders today is located
at this week’s low of 1,775.50 and then at 1,765.00. Sell
stops are likely located just below those levels. Wyckoff's
Intra-day Market Rating: 5.5

Nasdaq index futures: Prices are slightly 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 3,408.00 and then at this week’s high of
3,425.75. Buy stops likely reside just above those levels.
On the downside, short-term support is seen at 3,375.00 and
then at this week’s low of 3,358.50. Sell stops are likely
located just below those levels. Wyckoff's Intra-Day Market
Rating: 5.5.

Dow futures: Prices are near steady early today. Buy stops
likely reside just above technical resistance at 16,000 and
then at 16,050. Sell stops likely reside just below
technical support at Thursday’s low of 15,925 and then at
15,900. 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 to bearish early today. Wyckoff's Intra-Day
Market Rating: 5.5

U.S. TREASURY BONDS AND NOTES

March U.S. T-Bonds: Prices are near steady early today as
the market tries to stabilize after hitting a two-month low
Thursday. The bears still have some downside momentum.
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 early today. Shorter-
term resistance lies at the overnight high of 130 1/32 and
then at 130 16/32. Buy stops likely reside just above those
levels. Shorter-term technical support lies at the overnight
low of 129 22/32 and then at 129 12/32. Sell stops likely
reside just below those levels. Wyckoff's Intra-Day Market
Rating: 5.0
 
March U.S. T-Notes: Prices are near steady early today.
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
125.04.5 and then at 125.10.0. Buy stops likely reside just
above those levels. Shorter-term technical support lies at
this week’s low of 124.18.0 and then at the November low of
124.14.0. Sell stops likely reside just below those levels.
Wyckoff's Intra-Day Market Rating: 5.0

U.S. DOLLAR INDEX

The March U.S. dollar index is lower early today. The
greenback bears have the overall near-term technical
advantage. Slow stochastics for the dollar index are bearish
early today. The dollar index finds shorter-term technical
resistance at the overnight high of 81.260 and then at this
week’s high of 81.505. Shorter-term support is seen at the
overnight low of 80.960 and then at this week’s low of
80.750. Wyckoff's Intra Day Market Rating: 4.0

NYMEX CRUDE OIL

January Nymex crude oil prices are slightly lower early
today, following good gains posted Thursday. Bears still
have the overall near-term technical advantage. Prices are
in an 11-week-old downtrend on the daily bar chart. In
January Nymex crude, look for buy stops to reside just above
resistance at Thursday’s high of $95.63 and then at $96.00.
Look for sell stops just below technical support at $95.00
and then at $94.50. Wyckoff's Intra-Day Market Rating: 5.0

GRAINS

Markets were mostly firmer overnight on more short covering.
Reports say cash basis levels are improving in the U.S.,
which could mean that the lower prices have attracted fresh
export demand for U.S. grains. Focus of the market place has
turned more to the demand side of the equation, now that the
U.S. harvest is virtually complete. Technically, corn bears
are in firm command. Soybean bulls have faded a bit, while
wheat bears are in full control.
 

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