Jim's Morning Markets Report--September 19

September 19, 2013 02:14 AM
 

Thursday, September 19--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

Most world stock, financial and commodity markets were
cheered by the surprising news from the FOMC Wednesday
afternoon. The FOMC’s decision to not taper its $85 billion-
a-month bond-buying program, which is also called
quantitative easing, caught the market place completely off
guard. The FOMC members said they are still not convinced
the U.S. economy is healthy enough to begin winding down QE.
The Fed members are worried about the recent rise in U.S.
interest rates choking off the fledgling economic recovery.
Given the markets’ reactions to the FOMC meeting results, it
appears no tapering could be at least a near-term game-
changer for many markets. The printing presses of the
Federal Reserve will continue to run at high speed for at
least a while, or even for longer. That’s bullish for stock,
bond and commodity markets as it keeps the market place
awash in cash that is looking for an asset home. However,
the market place has to once again try to figure out when
the Federal Reserve will reduce its monthly bond buying. It
could be that after a short rally in the aforementioned
markets, trader and investor uncertainty due to the still-
unresolved timing of any Fed monetary policy change again
pervades the market place. Keener uncertainty on major
issues in the market place is usually a bearish underlying
factor. The looming U.S. budget and debt ceiling issues that
will soon be hotly debated by the U.S. Congress and the
Obama administration will become a front-burner matter for
the market place, and one that is likely to be bearish for
most markets, as there is already talk the U.S. government
could shut down for a short time. U.S. economic data due for
release Thursday includes the weekly jobless claims report,
existing home sales, leading economic indicators and the
Philadelphia Fed business outlook survey.--Jim
   
U.S. STOCK INDEXES

S&P 500 futures: Prices are higher early today and hit
another record high overnight. Bulls 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 and 18-day. The 9-day
is above the 18-day moving average. Short-term oscillators
(RSI, slow stochastics) are neutral to bullish early today.
Today, shorter-term technical resistance comes in at the
overnight all-time high of 1,726.50 and then at 1,735.00.
Buy stops likely reside just above those levels. Downside
support for active traders today is located at the overnight
low of 1,718.40 and then at 1,705.00. Sell stops are likely
located just below those levels. Wyckoff's Intra-day Market
Rating: 6.0

Nasdaq index futures: Prices are higher early today and hit
another fresh 12-year high overnight. The bulls 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 bullish early today. Shorter-
term technical resistance is located at the overnight high
of 3,235.75 and then at 3,250.00. Buy stops likely reside
just above those levels. On the downside, short-term support
is seen at the overnight low of 3,224.50 and then at
3,200.00. Sell stops are likely located just below those
levels. Wyckoff's Intra-Day Market Rating: 6.0.

Dow futures: Prices are higher early Thursday and hit a new
all-time high overnight. Bulls have the solid overall near-
term technical advantage. Buy stops likely reside just above
technical resistance at Wednesday’s high of 15,650 and then
at 15,700. Sell stops likely reside just below technical
support at 15,600 and then at 15,550. Shorter-term moving
averages are bullish early today, as the 4-day moving
average is above the 9-day. The 9-day moving average is
above the 18-day moving average. Shorter-term oscillators
(RSI, slow stochastics) are neutral to bullish early today.
Wyckoff's Intra-Day Market Rating: 6.0

U.S. TREASURY BONDS AND NOTES

September U.S. T-Bonds: Prices are weaker early today on a
corrective pullback from Wednesday’s solid gains. Bears
still have the overall near-term technical advantage.
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 133 12/32 and
then at Wednesday’s high of 133 31/32. Buy stops likely
reside just above those levels. Shorter-term technical
support lies at 132 28/32 and then at 132 16/32. Sell stops
likely reside just below those levels. Wyckoff's Intra-Day
Market Rating: 4.5
 
September U.S. T-Notes: Prices are firmer early today and
poked to a fresh six-week high overnight. Bears still have
the overall near-term technical advantage. However, the
bulls have gained upside momentum with Wednesday’s big
gains. 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 bullish
early today. Shorter-term resistance lies at the overnight
high of 125.31.0 and then at 126.08.0. Buy stops likely
reside just above those levels. Shorter-term technical
support lies at the overnight low of 125.19.5 and then at
125.16.0 Sell stops likely reside just below those levels.
Wyckoff's Intra-Day Market Rating: 5.5

U.S. DOLLAR INDEX

The September U.S. dollar index is weaker early today and
hit a fresh 7.5-month low overnight. Bears are in technical
command. Slow stochastics for the dollar index are bearish
early today. The dollar index finds shorter-term technical
resistance at 80.500 and then at 80.750. Shorter-term
support is seen at the overnight low of 80.155 and then at
80.000. Wyckoff's Intra Day Market Rating: 4.0

NYMEX CRUDE OIL

October Nymex crude oil prices are slightly higher early
today on mild follow-through buying from Wednesday’s strong
gains. Crude oil bulls have the solid overall near-term
technical advantage. In October Nymex crude, look for buy
stops to reside just above resistance at the overnight high
of $108.99 and then at $110.00. Look for sell stops just
below technical support at $108.00 and then at $107.50.
Wyckoff's Intra-Day Market Rating: 5.5

GRAINS

Markets were firmer overnight, supported by the bullish
effect of the FOMC news on Wednesday. Focus is on early
yield reports on the harvesting of the U.S. corn and
soybean crops in the Corn Belt—and on any fresh export
demand for U.S. grains. Technically, the soybean bulls
still have the overall advantage, while corn and wheat
market bears are in firm technical command. My bias is that
the corn and wheat markets do not have strong downside
price potential at present levels.
 

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