Jim's Morning Markets Report--October 3

October 3, 2013 01:53 AM
 

Thursday, October 3--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

The partial U.S. government shutdown is in its third day
with little to no signs lawmakers’ federal budget impasse
will end soon. There is growing anxiety in the world market
place but not panic. If the situation drags on over the
weekend and into next week, then trader and investor anxiety
will increase. If confidence in the market place continues
to wane, the odds will grow that market price volatility
will increase. In mid-October the U.S. government will hit
its borrowing limit. If that arguably more important matter
cannot be agreed upon by U.S. lawmakers in a timely manner,
then it could be a much bigger event for the market place
than the current budget impasse. Fresh U.S. budget news
coming out of Washington Thursday could be market-sensitive.
There is a growing notion among market watchers that what
some of my readers un-affectionately call "the Washington,
D.C. clown show" will prompt the U.S. Federal Reserve to
continue its monthly bond-buying program (quantitative
easing) at least a while longer due to the damage the
present government shutdown is doing to the U.S. economy and
consumer confidence. Some U.S. government reports have been
postponed due to the government furloughs, including
Friday’s monthly employment report. Non-government U.S.
economic reports will be issued as scheduled. Reports
overnight said China’s official non-manufacturing purchasing
managers’ index rose to a six-month high of 55.4 in
September, from 53.9 in August. Meantime, the Markit
European Union PMI rose to 52.2 in September from 51.5 in
August—the fastest growth pace in over two years for the EU.
Any PMI reading above 50.0 suggests economic growth. U.S.
economic data due for release Thursday includes the global
services PMI, the Challenger job-cut report, and the weekly
jobless claims report.--Jim
   
U.S. STOCK INDEXES

S&P 500 futures: Prices are weaker early today. The shorter-
term moving averages (4-, 9- and 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. Short-
term oscillators (RSI, slow stochastics) are neutral to
bearish early today. Today, shorter-term technical
resistance comes in at the overnight high of 1,682.40 and
then at this week’s high of 1,692.00. Buy stops likely
reside just above those levels. Downside support for active
traders today is located at the overnight low of 1,673.50
and then at this week’s low of 1,667.00. Sell stops are
likely located just below those levels. Wyckoff's Intra-day
Market Rating: 4.5

Nasdaq index futures: Prices are weaker early today. The
bulls still 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. 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 3,239.75 and then at this week’s high
of 3,251.25. Buy stops likely reside just above those
levels. On the downside, short-term support is seen at the
overnight low of 3,223.00 and then at 3,213.00. Sell stops
are likely located just below those levels. Wyckoff's Intra-
Day Market Rating: 4.5.

Dow futures: Prices are weaker early today. Bulls have
faded. Buy stops likely reside just above technical
resistance at Wednesday’s high of 15,055 and then at 15,100.
Sell stops likely reside just below technical support at
Wednesday’s low of 14,970 and then at 14,950. Shorter-term
moving averages are bearish early today, as the 4-day moving
average is below the 9-day and 18-day. The 9-day moving
average is below the 18-day moving average. Shorter-term
oscillators (RSI, slow stochastics) are bearish early today.
Wyckoff's Intra-Day Market Rating: 4.5

U.S. TREASURY BONDS AND NOTES


December U.S. T-Bonds: Prices are weaker early today. The
bulls still have some upside near-term technical momentum.
Shorter-term moving averages (4- 9- 18-day) are still
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 to
bearish early today. Shorter-term resistance lies at the
overnight high of 133 15/32 and then at this week’s high of
133 29/32. Buy stops likely reside just above those levels.
Shorter-term technical support lies at this week’s low of
132 22/32 and then at 132 16/32. Sell stops likely reside
just below those levels. Wyckoff's Intra-Day Market Rating:
4.5
 
December U.S. T-Notes: Prices are weaker early today. The
bulls still have some upside technical momentum. 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 bearish early
today. Shorter-term resistance lies at the overnight high
of 126.16.5 and then at the September high of 126.21.5. Buy
stops likely reside just above those levels. Shorter-term
technical support lies at the overnight low of 126.05.0 and
then at this week’s low of 125.30.5 Sell stops likely
reside just below those levels. Wyckoff's Intra-Day Market
Rating: 4.5

U.S. DOLLAR INDEX

The December U.S. dollar index is slightly lower early today
and hit another eight-month low overnight. Bears remain in
firm overall near-term technical command. Slow stochastics
for the dollar index are neutral early today. The dollar
index finds shorter-term technical resistance at 80.155 and
then at Wednesday’s high of 80.380. Shorter-term support is
seen at the overnight low of 79.830 and then at 79.750.
Wyckoff's Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

November Nymex crude oil prices are slightly lower early
today on a corrective pullback after Wednesday’s sharp
gains. In November Nymex crude, look for buy stops to reside
just above resistance at this week’s high of $104.23 and
then at $105.00. Look for sell stops just below technical
support at the overnight low of $103.45 and then at $103.00.
Wyckoff's Intra-Day Market Rating: 4.5

GRAINS

Markets were firmer overnight. Corn and soybeans are seeing
some short covering following recent selling pressure.
Wheat bulls continue to gain upside near-term technical
momentum. There is just not much bullish news in the grain
markets at present. The "risk-off" mentality in the market
place this week is a bearish underlying factor for the
grains. U.S. harvest progress in soybeans are corn is
progressing rapidly this week, which is also bearish. With
much of USDA now closed, there will be a lack of fresh
fundamental news for grain traders to digest, and that will
likely favor the bearish camp.
 

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