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Thursday, February 21–Jim Wyckoff’s Morning Web Log

OVERNIGHT/EARLY MORNING DEVELOPMENTS

The market feature in overnight/early morning trading today is higher gold and silver prices. Gold futures hit a fresh all-time high above $950.00 overnight, while silver futures hit $18.00 an ounce and are at a 28-year high.

* JIM’S MARKET THOUGHT OF THE DAY *

Commodity traders should keep an eye on the value of the Euro currency against the U.S. dollar. The Euro is presently in a sideways trading range at higher levels. The direction in which the Euro “breaks out” of the trading range will likely be key for commodity traders. An upside breakout by the Euro, to fresh highs, would be commodity-market bullish and suggest another fresh leg up in commodity prices forthcoming. But a downside breakout in the Euro from the sideways trading range would be commodity-market bearish and suggest at least significant corrective pullbacks in many commodity markets.–Jim

U.S. STOCK INDEXES

The stock indexes are firmer in early morning electronic trading. The indexes has basically been in a sideways trading range for four weeks.

March S&P 500: The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is above 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 1,356.50. Sell stops likely reside just under that level. More sell stops likely reside under shorter-term technical support at 1,350.00. Upside resistance for active traders today is located at last week’s high of 1,371.10 and then at 1,380.00. 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: 1,355.00.

PIVOT POINT LEVELS FOR MARCH S&P 500:

Pivot:———— 1,352.50
1st Support:—— 1,340.40
2nd Support:—— 1,321.80
1st Resistance:— 1,371.10
2nd Resistance:— 1,383.20

March Nasdaq Index: The shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above the 9-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 1,788.75. Sell stops likely reside just below that level, and then more sell stops are likely located just below technical support at 1,770.00. On the upside, short-term resistance is seen at this week’s high of 1,821.00 and then at 1,831.25. 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: 1,790.00

PIVOT POINT LEVELS FOR MARCH NASDAQ:

Pivot:———— 1,780.00
1st Support:—— 1,764.00
2nd Support:—— 1,738.75
1st Resistance:— 1,805.25
2nd Resistance:— 1,821.25

March Dow: Sell stops likely reside just below support at 12,400 and then more stops just below support at 12,277. Buy stops likely reside just above shorter-term technical resistance at 12,500 and then just above resistance at 12,580. Shorter-term moving averages are neutral early today, as the 4-day moving average is above the 9-day. The 9-day moving average is below 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: 12,400

PIVOT POINT LEVELS FOR MARCH DOW:

Pivot:———— 12,375
1st Support:—— 12,284
2nd Support:—— 12,140
1st Resistance:— 12,519
2nd Resistance:— 12,610

U.S. TREASURY BONDS AND NOTES

U.S. T-Bonds and T-Notes futures prices are firmer in early trading today, on short covering.

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 and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance lies at the overnight high of 116 18/32 and then at 117 even. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 116 1/32. Sell stops likely reside just below that level. More sell stops are likely located below support at 115 24/32. Wyckoff’s Intra-Day Market Rating: 5.0

Today’s key near-term Fibonacci support/resistance level: 117 6/32

PIVOT POINT LEVELS FOR MARCH T-BONDS:

Pivot:———– 115 30/32
1st Support:—– 115 17/32
2nd Support:—– 114 25/32
1st Resistance:– 116 22/32
2nd Resistance:– 117 3/32

March 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 the overnight high of 115.19.0 and then just above resistance at Wednesday’s high of 115.29.0. Shorter-term moving averages are bearish early today. The 4-day moving average is below the 9-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 115.07.5 and then more sell stops just below support at 115.00.0. Wyckoff’s Intra Day Market Rating: 5.0

Today’s key near-term Fibonacci support/resistance level: 116.05.0

PIVOT POINT LEVELS FOR MARCH T-NOTES:

Pivot:———— 115.16.0
1st Support:—— 115.04.0
2nd Support:—— 114.23.0
1st Resistance:— 115.29.0
2nd Resistance:— 116.09.0

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Another day, another opening gap faded. We’re 3-for-3 this week with the market gapping one way and almost immediately reversing direction. This market is a gap-fader’s paradise. Despite what felt like a really bad reaction to the Philly Fed numbers today the indices are still just range-bound. It seems that the market’s reaction to both good and bad news these days is “tell me something I don’t already know”.

T. Boone Pickens was on CNBC this morning calling for oil to retrace about $15 before eventually hitting $150. Based on the chart below I can see the attractiveness of getting short right here — it’s been overbought for a couple of weeks and could easily slip back into its 4 month long range of about 86 to 98. (I’d like CNBC to bring back all the folks who swore we’d NEVER see $100 oil.)

Trend Table

Trend	Nasdaq	S&P 500	Russell 2000
Primary	Down	Down	Down
Intermediate	Down	Down	Down
Short-term	Down(-)	Lat	Lat

(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend

*** I’m simply using the indices’ relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.

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