Jim Wyckoff’s Morning Blog

Jim Wyckoff, Senior Analyst, TraderPlanet.com, LLC

Tuesday- 6.9.09

OVERNIGHT/EARLY MORNING DEVELOPMENTS

There is no standout market feature in quieter overnight/early morning trading today.

JIM’S MARKET THOUGHT OF THE DAY *

Among traders and investors, there are the believers and the non-believers in the study of technical analysis of market prices. Having studied and written about markets for a quarter-century now, I fall into the believer camp. I do also follow the supply and demand fundamentals of a market, even though I follow too many markets to “drill down” too far on fundamentals of every single market. Recent price action in the markets has confounded many traders and analysts. The supply and demand or economic fundamentals of many markets do not appear to correlate with recent price action. This phenomenon is not uncommon. That’s why the study of technical analysis is employed by most successful traders. By looking at a price chart for a market, and determining the trend (up, down or sideways) a trader knows the market “is what it is.” –Jim

U.S. STOCK INDEXES

The U.S. stock indexes are steady to firmer in early morning trading today. Bulls still have some near-term technical momentum on their side after prices last week notched fresh multi-month highs. However, the uptrends in the indexes have decelerated as summertime is at hand.

September S&P 500: 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. The 9- day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical support comes in at 925.00 and then at last week’s low of 918.80. Sell stops likely reside just under those levels. Upside resistance for active traders today is located at Monday’s high of 941.50 and then at last week’s high of 947.20. Buy stops are likely located just above those levels. Wyckoff’s Intra- day Market Rating: 5.0

Today’s key near-term Fibonacci support/resistance level: 917.00.

PIVOT POINT LEVELS FOR SEPTEMBER S&P 500:

Pivot:————-  932.55
1st Support:——– 923.60
2nd Support:——– 912.55
1st Resistance:—– 943.60
2nd Resistance:—– 952.55

Nasdaq Index: 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 to bearish early today. Shorter-term technical support is located at 1,475.00 and then at Monday’s low of 1,465.00. Sell stops likely reside just below those levels. On the upside, short-term resistance is
seen at last week’s high of 1,500.50 and then at 1,515.00. Buy stops are likely located just above those levels. Wyckoff’s Intra-Day Market Rating: 5.0

Today’s key near-term Fibonacci support/resistance level: 1,475.00

PIVOT POINT LEVELS FOR NASDAQ:

Pivot:———— 1,483.75
1st Support:—— 1,470.50
2nd Support:—— 1,451.75
1st Resistance:— 1,502.50
2nd Resistance:— 1,515.75

September Dow: Sell stops likely reside just below support at 8,640 and then more stops just below support at Monday’s low of 8,605. Buy stops likely reside just above shorter-term technical resistance at last week’s high of 8,742 and then at 8,800. 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 early today. Wyckoff’s Intra-Day Market Rating: 5.0

Today’s key near-term Fibonacci support/resistance level: 8,558

PIVOT POINT LEVELS FOR SEPTEMBER DOW:

Pivot:———— 8,680
1st Support:—— 8,628
2nd Support:—— 8,553
1st Resistance:— 8,755
2nd Resistance:— 8,807

U.S. TREASURY BONDS AND NOTES

U.S. T-Bonds and T-Notes are firmer in early trading today, on a tepid short-covering bounce in a bear market. Bears still have the solid overall near-term technical advantage.

September U.S. T-Bonds: Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical support lies at the overnight low of 113 14/32 and then at last week’s low of 112 31/32. Sell stops likely reside just below those levels. Shorter-term technical resistance lies at the overnight high of 114 even and then at 114 16/32. Buy stops likely reside just above those levels. Wyckoff’s Intra-Day Market Rating: 5.5

Today’s key near-term Fibonacci support/resistance level: 114 26/32

September U.S. T-Bonds

138 27/32–lifetime high
123 28/32–100-day moving average
122 11/32–Previous Month’s high
117 19/32–18-day moving average
115 3/32–9-day moving average
114 30/32–second pivot point resistance
114 12/32–previous day’s high
114 12/32–previous month’s low
114 10/32–4-day moving average
114 4/32–first pivot point resistance
113 18/32–pivot point
113 10/32–previous day’s close
113 –previous day’s low
112 24/32–first pivot point support
112 6/32–second pivot point support
110 8/32–lifetime low

September U.S. T-Notes: Shorter-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Buy stops likely reside just above shorter-term technical resistance at Monday’s high of 113.26.0 and then at 114.00.0. Shorter-term moving averages 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. Sell stop orders are likely located just below support at the overnight low of 113.08.0 and then at Monday’s low of 112.31.5. Wyckoff’s Intra Day Market Rating: 5.5

Today’s key near-term Fibonacci support/resistance level: 114.11.0

September U.S. T-Notes

125 24/32–lifetime high
120 14/32–previous month’s high
120 3/32–100-day moving average
117 5/32–18-day moving average
115 12/32–previous month’s low
115 9/32–9-day moving average
114 14/32–4-day moving average
114 4/32–second pivot point resistance
113 26/32–previous day’s high
113 20/32–first pivot point resistance
113 9/32–pivot point
113 3/32–previous day’s close
112 31/32–previous day’s low
112 25/32–first pivot point support
112 14/32–second pivot point support
109 –lifetime low

CURRENCIES

The September U.S. dollar index is lower in early trading today. Slow stochastics for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at the overnight high of 81.57 and then at Monday’s high of 81.97. Shorter-term support is seen at the overnight low of 80.94 and then at 80.50. Today’s key near-term Fibonacci support/resistance level: 80.41. Wyckoff’s Intra Day Market Rating: 4.0

The September Euro is firmer in early electronic trading. Euro finds sell stop orders are likely located just below technical support at the overnight low of 1.3839 and then at Monday’s low of 1.3792. Shorter-term technical resistance for the Euro is seen at the overnight high of 1.3953 and then at Monday’s high of 1.3986. Buy stops likely reside just above those levels. Slow stochastics for the Euro are bearish early today. Today’s key
near-term Fibonacci support/resistance level: 1.4063. Wyckoff’s Intra Day Market Rating: 5.5

GOLD

Gold is firmer in early dealings today, as the U.S. dollar has weakened overnight. Gold bulls are fading and do need to show fresh power soon. For August gold, shorter-term technical resistance is seen at Monday’s high of $961.10 and then at $970.00. Buy stops likely reside just above those levels. Sell stops likely reside just below support at the overnight low of $948.30 and then at Monday’s low of $943.80. Today’s key near-term Fibonacci support/resistance level: $945.00. Wyckoff’s Intra-Day Market Rating: 5.5

CRUDE OIL

Crude oil prices are higher early today. Bulls are still technically strong amid an uptrend on the daily bar chart that is still firmly in place. In July crude, look for buy stops to reside just above resistance at $70.00 and then just above resistance at last week’s high of $69.55. Look for sell stops just below technical support at the overnight low of $68.43 and then more sell stops just below support at $68.00. Today’s key near-term Fibonacci support/resistance level: $67.87. Wyckoff’s Intra-Day Market Rating: 6.0

GRAINS

Prices were firmer in overnight trading. Trading has turned choppier. The key “outside markets” are mostly bullish early today as the U.S. stock indexes are steady to firmer, crude oil prices are higher and the U.S. dollar is lower. Traders are looking ahead to the key USDA supply and demand report, out on Wednesday morning. Weather in the Corn Belt at present is still deemed mostly benign, which does favor the bears. However, the key Fourth of July holiday weekend is approaching, at which time grain price trends can either change, or accelerate.