Jim's Morning Markets Report--September 30

September 30, 2013 01:48 AM
 

Monday, September 30--Jim Wyckoff's Morning Web Log

* LATEST MARKET DEVELOPMENTS *

It’s a "risk-off" trader and investor mentality in the world
market place Monday. The main focus of the market place is
on the U.S. budget impasses that threatens to shut down part
of the U.S. government Tuesday—which would be the first
government shutdown in 17 years. The weekend saw no apparent
progress made by legislators on the matter. Also, in mid-
October the U.S. government will hit its borrowing limit.
These issues are presently an underlying bearish factor for
many markets and could become a major bearish factor in the
next couple weeks, if no progress is made among U.S.
lawmakers and the Obama administration. Gold may be seeing
some buying interest due to safe-haven demand amid the U.S.
budget and spending debacle. However, it can be argued
recent selling pressure in gold was because it acted more
like a raw commodity ahead of the U.S. budget deadlines.
It’s likely one of these scenarios will more clearly come to
the forefront for gold early this week. The other factor
causing a "risk-off" day in the market place Monday is
turmoil in the Italian government that threatens to collapse
it. Italian stocks and bonds were under pressure Monday.
Monday is also the last day of the month and of the quarter,
which could make for more active market activity as traders
square their books. China markets are closed the rest of
this week for the annual Golden holiday. In economic news
overnight, European Union inflation fell to its lowest level
in over three years in September. Consumer inflation rose by
1.1%, year-on-year, in the Euro zone. This news bolsters the
European Central Bank’s case that it could pump more money
into the EU financial system and still not spark
inflationary problems. In an important development for many
markets, Friday afternoon President Obama said he talked on
the telephone with the Iranian president, regarding Iran’s
pledge not to make nuclear weapons and both countries
working to establish more normal relations—after more than
30 years of animosity. A thawing in U.S.-Iran relations, a
de-escalation of the Syria-U.S. confrontation over its
chemical weapons and the surprising progress the U.S. had
made the past few years on dramatically increasing its own
crude oil production all suggest the Middle East may become
less of a powder keg for world markets in the coming months,
or longer. Others would argue the notion of a stable Middle
East is still just a pipe dream. Reports Monday said the
Chinese government will relax its restrictions on public
trading of gold, allowing more public and business
participation in gold trading. U.S. economic data due for
release Monday includes the Chicago Fed midwest
manufacturing index, the ISM Chicago business survey, and
the Texas manufacturing survey.--Jim
   
U.S. STOCK INDEXES

S&P 500 futures: Prices are lower early today and hit a
fresh three-week low overnight. Bulls are fading. The
shorter-term moving averages (4-, 9- and 18-day) are neutral
early today. The 4-day moving average is below the 9-day and
18-day. The 9-day is above the 18-day moving average. Short-
term oscillators (RSI, slow stochastics) are bearish early
today. Today, shorter-term technical resistance comes in at
the overnight high of 1,676.90 and then at 1,685.00. Buy
stops likely reside just above those levels. Downside
support for active traders today is located at 1,667.00 and
then at 1,660.00. Sell stops are likely located just below
those levels. Wyckoff's Intra-day Market Rating: 4.0

Nasdaq index futures: Prices are lower early today. The
bulls still have the overall near-term technical advantage.
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 bearish early today.
Shorter-term technical resistance is located at the
overnight high of 3,212.25 and then at 3,225.00. Buy stops
likely reside just above those levels. On the downside,
short-term support is seen at 3,189.00 and then at 3,175.00.
Sell stops are likely located just below those levels.
Wyckoff's Intra-Day Market Rating: 4.0.

Dow futures: Prices are lower early today. Bulls are fading.
Buy stops likely reside just above technical resistance at
15,100 and then at 15,140. Sell stops likely reside just
below technical support at 15,000 and then at 14,950.
Shorter-term moving averages are neutral early today, as the
4-day moving average is below 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 bearish
early today. Wyckoff's Intra-Day Market Rating: 4.0

U.S. TREASURY BONDS AND NOTES


December U.S. T-Bonds: Prices are firmer early today and hit
a nine-week high overnight. The bulls have upside near-term
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
neutral early today. Shorter-term resistance lies at the
overnight high of 133 25/32 and then at 134 even. Buy stops
likely reside just above those levels. Shorter-term
technical support lies at the overnight low of 133 9/32 and
then at 133 even. Sell stops likely reside just below those
levels. Wyckoff's Intra-Day Market Rating: 6.0
 
December U.S. T-Notes: Prices are firmer early today and
hit a three-month high overnight. The bulls have 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
neutral early today. Shorter-term resistance lies at the
overnight high of 126.21.5 and then at 127.00.0. Buy stops
likely reside just above those levels. Shorter-term
technical support lies at the overnight low of 126.11.5 and
then at 126.00.0 Sell stops likely reside just below those
levels. Wyckoff's Intra-Day Market Rating: 6.0

U.S. DOLLAR INDEX

The December U.S. dollar index is near steady early today.
Bears remain in overall near-term technical command. Slow
stochastics for the dollar index are neutral early today.
The dollar index finds shorter-term technical resistance at
the overnight high of 80.490 and then at last week’s high of
80.760. Shorter-term support is seen at last week’s low of
80.205 and then at the September low of 80.155. Wyckoff's
Intra Day Market Rating: 5.0

NYMEX CRUDE OIL

November Nymex crude oil prices are lower early today and
hit a fresh six-week low overnight. Bears have downside
near-term technical momentum. In November Nymex crude, look
for buy stops to reside just above resistance at $102.00 and
then at the overnight high of $102.54. Look for sell stops
just below technical support at $101.00 and then at the
August low of $100.80. Wyckoff's Intra-Day Market Rating:
4.0

GRAINS

Markets were mixed overnight. The "risk-off" mentality in
the market place is a bearish underlying factor for the
grains. U.S. harvest progress in soybeans are corn will
likely progress rapidly this week, and that’s also bearish.
Wheat bulls are making a good upside progress. There are
technical clues the wheat markets have put in major lows.
Traders are looking ahead to Monday’s USDA quarterly grain
stocks report. That report is expected to be bearish for
corn and soybeans.
 

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