Thursday, January 22--Jim Wyckoff's Morning Web Log
***NOTE: There will be no Friday morning report. I will be out of the office to attend my daughter's wedding.--Jim
OVERNIGHT/EARLY MORNING DEVELOPMENTS
There is no standout market feature in overnight/early morning trading today, amid quieter market dealings early.
JIM'S MARKET THOUGHT OF THE DAY *
I got an email yesterday from a trader who said he was stuck in a losing streak. He said he's been stopped out for a loss on each of his last four trades. He then asked me if the markets had been extra choppy recently. My answer was yes, the markets have indeed been choppier and less trending recently. The trader was a bit down, understandably, after four losing trades in a row. However, I told him that four losing trades in a row in the business of trading futures is not uncommon. I also told him that my trading mentor suffered a streak of 13 losing trades in a row--and still did not alter his trading methods, which he still considered sound. And finally, I told this trader that had he not been employing protective stops in his trades, his smaller, manageable losses could have turned into bigger, catastrophic losses. Any trader who's been trading for any period of time has had to endure a losing streak. They are never fun. But they are a part of the endeavor of trading markets. By the way, I do enjoy hearing from my readers worldwide. Drop me an email just to say hi and tell me where you live. My email address is jim@jimwykcoff.com . --Jim
U.S. STOCK INDEXES
The U.S. stock indexes are weaker in early morning trading today. Bears still have the overall near-term technical advantage. The stock indexes have become a major "outside market" that many other markets are monitoring very closely.
March S&P 500: 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 early today. Today, shorter-term technical support comes in at the overnight low of 827.90 and then at 813.00. Sell stops likely reside just under those levels. Upside resistance for active traders today is located at the overnight high of 843.60 and then at 850.00. Buy stops are likely located just above those levels. Wyckoff's Intra-day Market Rating: 4.5
Today's key near-term Fibonacci support/resistance level: 840.00.
PIVOT POINT LEVELS FOR MARCH S&P 500:
Pivot:------------- 825.35
1st Support:-------- 812.50
2nd Support:-------- 788.15
1st Resistance:----- 849.70
2nd Resistance:----- 862.55
March Nasdaq Index: 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 average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical support is located at the overnight low of 1,181.50 and then at 1,150.00. Sell stops likely reside just below those levels. On the upside, short-term resistance is seen at the overnight high of 1,201.25 and then at this week's high of 1,219.00. 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: 1,200.00
PIVOT POINT LEVELS FOR MARCH NASDAQ:
Pivot:------------ 1,168.50
1st Support:------ 1,152.00
2nd Support:------ 1,122.50
1st Resistance:--- 1,198.00
2nd Resistance:--- 1,214.50
March Dow: Sell stops likely reside just below support at 8,100 and then more stops just below support at 8,000. Buy stops likely reside just above shorter-term technical resistance at 8,250 and then just above resistance at 8,300. Shorter-term moving averages are bearish early today, as the 4-day moving average is below the 9-day. The 9-day moving average is below the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are bullish early today. Wyckoff's Intra-Day Market Rating: 5.0
Today's key near-term Fibonacci support/resistance level: 8,363
PIVOT POINT LEVELS FOR MARCH DOW:
Pivot:------------ 8,086
1st Support:------ 7,982
2nd Support:------ 7,786
1st Resistance:--- 8,282
2nd Resistance:--- 8,386
U.S. TREASURY BONDS AND NOTES
U.S. T-Bonds and T-Notes futures are lower again in early trading today. The bulls are fading again and some near-
term chart damage has now occurred.
March 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 bearish early today. Shorter-term technical support lies at the overnight low of 130 19/32 and then at 130 even. Sell stops likely reside just below those levels. Shorter-term technical resistance lies at the overnight high of 131 20/32 and then at 132 even. Buy stops likely reside just above those levels. Wyckoff's Intra-Day Market Rating: 4.0
Today's key near-term Fibonacci support/resistance level: 130 1/32
PIVOT POINT LEVELS FOR MARCH U.S. T-BONDS:
Pivot:----------- 132 12/32
1st Support:----- 130 16/32 2nd Support:----- 129 14/32
1st Resistance:-- 133 14/32
2nd Resistance:-- 135 10/32
March U.S. T-Notes: Shorter-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Buy stops likely reside just above shorter-term technical resistance at 125.00.0 and then at 125.16.0. Shorter-term moving averages 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. Sell stop orders are likely located just below support at the overnight low of 124.08.5 and then at 124.00.0. Wyckoff's Intra Day Market Rating: 4.5
Today's key near-term Fibonacci support/resistance level: 125.12.0
PIVOT POINT LEVELS FOR MARCH U.S. T-NOTES:
Pivot:----------- 125 4/32
1st Support:----- 124 10/32 2nd Support:----- 123 26/32
1st Resistance:-- 125 20/32
2nd Resistance:-- 126 14/32
CURRENCIES
The March U.S. dollar index is slightly lower in early trading today, on mild profit-taking pressure. Bulls still have some upside technical momentum. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at 86.50 and then at 87.00. Shorter-term support is seen at 86.00 and then at the overnight low of 85.82. Today's key near-term Fibonacci support/resistance level: 85.54. Wyckoff's Intra Day Market Rating: 5.0
The December Euro is slightly higher in early electronic trading, on short covering. Euro finds sell stop orders are likely located just below technical support at the overnight low of 1.2933 and then at 1.2900. Shorter-term technical resistance for the Euro is seen at 1.3000 and then at the overnight high of 1.3074. Buy stops likely reside just above those levels. Slow stochastics for the Euro are neutral early today. Today's key near-term Fibonacci support/resistance level: 1.3017. Wyckoff's Intra Day Market Rating: 5.0
GOLD
Gold is near slightly lower in early dealings today. For February gold, shorter-term technical resistance is seen at the overnight high of $859.50 and then at this week's high of $866.60. Buy stops likely reside just above those levels. Sell stops likely reside just below support at $843.00 and then at $836.00. Today's key near-term Fibonacci support/resistance level: $846.50. Wyckoff's Intra-Day Market Rating: 4.5
CRUDE OIL
Crude oil prices are slightly lower early today. Bears still have the near-term technical advantage. In March crude, look for buy stops to reside just above resistance at $45.00 and then just above resistance at $46.00. Look for sell stops just below technical support at $42.50 and then more sell stops just below support at $42.00. Today's key near-term Fibonacci support/resistance level: $44.30. Wyckoff's Intra-Day Market Rating: 4.5
GRAINS
Prices were higher in overnight trading. Grain traders are now focusing more on their own market fundamentals and less on outside markets. Recent price action partly reflects the upcoming acreage battle between corn and soybeans that will take place in the U.S. this spring. The present notion is that soybean acres will substantially increase in the U.S. this year, while corn acres will show a marked drop. Corn and soybean traders are continuing to monitor South American weather, which has not seen ideal growing conditions for corn and soybeans, and is providing a bullish upside force, especially for soybeans. I still am cautious about the "February Break" seasonal phenomenon in grains.