Jim's Morning Markets Report--Nov. 4

November 4, 2013 12:40 AM
 

Monday, November 4--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

The European Stoxx 600 index hit a five-year high overnight
on ideas the European Central Bank could ease its monetary
policy at Thursday’s meeting, and on upbeat economic data
coming out of  China. The ECB could be compelled to try to
boost the fragile economic recovery in the EU by lower
interest rates—especially after EU data last week showed
very low inflationary pressure in the bloc. Meantime,
China’s official non-manufacturing purchasing managers index
rose to a 14-month high of 56.3 in October. Germany’s better
economic health lifted the collective number, as the
periphery EU countries’ economies remain weak. The data firm
Markit also on Monday reported the European Union’s PMI came
in at 51.3 in October versus 51.1 in September. China’s
Communist party meets this week, during which time major
plans and reforms are unveiled by the leaders of the
country. The world market place will be closely watching for
any proclamations coming from that confab. Reports say slack
demand for physical gold from India, during its Diwali
festival season, is a bearish underlying fundamental factor
for the metal. Indian government import restrictions and
increased duties on gold imports have hurt consumer demand
in that major gold-consuming nation. U.S. economic data due
for release Monday includes the New York ISM report on
business, manufacturers’ shipments and orders, and the
global manufacturing PMI. There is a heavy slate of U.S.
economic data due for release this week, including the key
U.S. jobs report on Friday.--Jim
   
U.S. STOCK INDEXES

S&P 500 futures: Prices are firmer in early U.S. trading.
These bull market runs in the stock indexes are very mature,
with the bullish notions becoming too pervasive. That’s a
warning signal of a top being close at hand. The shorter-
term moving averages (4-, 9- and 18-day) are still bullish
early today. The 4-day moving average is above the 9- 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
1,764.00 and then at the record high of 1,773.10. Buy stops
likely reside just above those levels. Downside support for
active traders today is located at last week’s low of
1,747.50 and then at 1,734.50. 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. 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 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
3,394.00 and then at last week’s high of 3,401.75. Buy stops
likely reside just above those levels. On the downside,
short-term support is seen at the overnight low of 3,366.75
and then at last week’s low of 3,357.50. Sell stops are
likely located just below those levels. Wyckoff's Intra-Day
Market Rating: 5.5.

Dow futures: Prices are higher early today. Buy stops likely
reside just above technical resistance at last week’s record
high of 15,660 and then at 15,700. Sell stops likely reside
just below technical support at 15,585 and then at 15,500.
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 firmer early today on
short covering from selling pressure last week. Shorter-term
moving averages (4- 9- 18-day) are neutral early today. The
4-day moving average is below the 9-day. The 9-day is above
the 18-day moving average. Oscillators (RSI, slow
stochastics) are bearish early today. Shorter-term
resistance lies at 134 even and then at 134 16/32. Buy stops
likely reside just above those levels. Shorter-term
technical support lies at the overnight low of 133 20/32 and
then at 133 10/32. Sell stops likely reside just below those
levels. Wyckoff's Intra-Day Market Rating: 5.5
 
December U.S. T-Notes: Prices are firmer early today on
some short covering and bargain hunting. Shorter-term
moving averages (4- 9- 18-day) are neutral early today. The
4-day moving average is below 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 127.00.0 and then at Friday’s high of
127.09.0. Buy stops likely reside just above those levels.
Shorter-term technical support lies at the overnight low of
126.21.5 and then at 126.16.0. Sell stops likely reside
just below those levels. Wyckoff's Intra-Day Market Rating:
5.5

U.S. DOLLAR INDEX

The December U.S. dollar index is weaker early today on
profit taking after hitting a fresh six-week high early on.
While bears remain in overall near-term technical control,
the bulls are making a strong move, to suggest a market low
is in place. Slow stochastics for the dollar index are
bullish early today. The dollar index finds shorter-term
technical resistance at the overnight high of 81.020 and
then at 81.250. Shorter-term support is seen at 80.500 and
then at Friday’s low of 80.320. Wyckoff's Intra Day Market
Rating: 4.5

NYMEX CRUDE OIL

December Nymex crude oil prices are lower early today and
hit another fresh four-month low overnight. Bears have the
overall near-term technical advantage. Prices are in a nine-
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 $95.50. Look for sell stops just below
technical support at $94.00 and then at $93.50. Wyckoff's
Intra-Day Market Rating: 4.0

GRAINS

Markets were narrowly mixed overnight. Bulls and bears are
weighing conflicting factors to start the new trading week:
the still-bearish specter of the U.S. corn and soybean
harvest and the related hedge selling, and the better
export demand for U.S. grains seen recently. Traders will
focus on USDA data this week, including Monday evening’s
crop progress report and Friday’s latest monthly supply and
demand report. Technically, the corn bears are still in
firm command, while soybeans are technically neutral on a
near-term basis and wheat bears have the near-term
technical advantage.
 

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