Jim's Morning Markets Report--Nov. 27

November 27, 2013 01:08 AM
 

Wednesday, November 27--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

It’s a somewhat quieter market place so far Wednesday, in a
pre-holiday trading atmosphere. The U.S. Thanksgiving
holiday is on Thursday. However, it’s a very busy day for
U.S. economic data, and that data could move the markets—
especially if trading volumes are already thin.

U.S. economic data due for release Wednesday includes the
weekly MBA mortgage applications survey, durable goods
orders, weekly jobless claims, the Chicago Midwest
manufacturing index, the Chicago Fed national activity
index, the ISM Chicago business survey, the University of
Michigan consumer sentiment index, leading economic
indicators, and the weekly DOE liquid energy stocks report.

In Europe Wednesday, the German GfK consumer confidence
index rose to its highest level in six years. This continues
a recent string of upbeat economic data coming out of the
EU.

There was an "incident" earlier this week when U.S. military
planes purposely flow over some islands in the East China
Sea, which China now claims as its own, but Japan also
claims it owns. China had just sent out a dispatch saying
those islands were now under its airspace watch. This news
may be part of the reason the safe-have gold market got a
lift Wednesday. The world is awaiting China’s response to
the U.S. military’s move.

Focus of traders and investors is already turning to
December, when the European Central Bank and U.S. Federal
Reserve hold their next monetary policy meetings. The market
place for many weeks has been preoccupied with the precise
timing of when the Fed will alter its monetary policy and
back off from its monthly bond-buying program—called
quantitative easing. Meantime, the ECB has just eased its
monetary policy and the market place is wondering what ECB
president Mario Draghi will have up his sleeve at the early-
December ECB meeting. The European Union is presently
battling very low inflation that could turn into dreaded
deflation.

Wyckoff’s Daily Risk Rating: 7.0 (While so far it’s a
quieter, pre-holiday market place Wednesday, there is a big
batch of U.S. economic data released, which could move the
markets.)

(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 slightly higher in early U.S.
trading. Prices are hovering near this week’s record high.
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
Monday’s record high of 1,808.80 and then at 1,825.00. Buy
stops likely reside just above those levels. Downside
support for active traders today is located at Monday’s low
of 1,799.00 and then at 1,792.20. 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
and hovering near this week’s 13-year high. 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
average is above the 18-day. Short-term oscillators (RSI,
slow stochastics) are bullish early today. Shorter-term
technical resistance is located at this week’s high of
3,456.00 and then at 3,475.00. Buy stops likely reside just
above those levels. On the downside, short-term support is
seen at the overnight low of 3,445.75 and then at this
week’s low of 3,422.75. Sell stops are likely located just
below those levels. Wyckoff's Intra-Day Market Rating: 5.5.

Dow futures: Prices are slightly higher early today and
hovering near this week’s record high. Buy stops likely
reside just above technical resistance at 16,100 and then at
16,150. Sell stops likely reside just below technical
support at 16,000 and then at 15,950. 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

March U.S. T-Bonds: Prices are weaker early today. The bears
have the overall near-term technical advantage as prices are
in a choppy, four-week-old downtrend on the daily bar chart.
Shorter-term moving averages (4- 9- 18-day) are neutral
early today. The 4-day moving average is above 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 131 2/32 and
then at this week’s high of 131 9/32. Buy stops likely
reside just above those levels. Shorter-term technical
support lies at the overnight low of 130 27/32 and then at
Tuesday’s low of 130 21/32. Sell stops likely reside just
below those levels. Wyckoff's Intra-Day Market Rating: 4.0
 
March U.S. T-Notes: Prices are weaker early today. 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 early today. Shorter-term
resistance lies at the overnight high of 125.22.5 and then
at last week’s high of 125.26.5. Buy stops likely reside
just above those levels. Shorter-term technical support
lies at the overnight low of 125.17.5 and then at Tuesday’s
low of 125.12.0. Sell stops likely reside just below those
levels. Wyckoff's Intra-Day Market Rating: 4.0

U.S. DOLLAR INDEX

The March U.S. dollar index is lower early today. The
greenback bears have the overall near-term technical
advantage amid recent choppy trading. Slow stochastics for
the dollar index are bearish early today. The dollar index
finds shorter-term technical resistance at the overnight
high of 80.89 and then at 81.000. Shorter-term support is
seen at the overnight low of 80.675 and then at 80.500.
Wyckoff's Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

January Nymex crude oil prices are lower early today and hit
a fresh five-month low overnight. Bears have the overall
near-term technical advantage. Prices are in a three-month-
old downtrend on the daily bar chart. In January Nymex
crude, look for buy stops to reside just above resistance at
the $93.00 and then at the overnight high of $93.60. Look
for sell stops just below technical support at $92.00 and
then at $91.50. Wyckoff's Intra-Day Market Rating: 4.0

GRAINS

Markets were firmer overnight on short covering. The South
American planting and growing season for corn and soybeans
is now a market factor. So far, weather conditions in South
America are favorable, which is a bearish underlying factor
for soybeans and to a lesser degree corn. Technically, corn
bears are in firm command. Soybean bulls have the near-term
technical advantage, and wheat bears remain in full
technical control.
 

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