Friday, September 26--Jim Wyckoff's Morning Web Log
OVERNIGHT/EARLY MORNING DEVELOPMENTS
The market feature in overnight/early morning trading today is lower crude oil and U.S. stock index futures prices, as the government's financial sector bailout package, which seemed near finalization and passage Thursday afternoon, fell apart among partisan wrangling by U.S. Congress members late Thursday night.
* JIM'S MARKET THOUGHT OF THE DAY *
Washington Mutual was seized by U.S. bank regulators overnight, in the largest bank failure in U.S. history. Combine this with the fact that the financial bailout talks have broken down in government and the stage is now set for an ugly day in the stock market Friday--especially heading into a weekend. Recent history has shown that weekends can to produce big surprises for the markets come Monday morning. If I'm a trader with any significant market exposure, given the overnight developments, I'm probably going to seriously lighten up my positions heading into the weekend. The only market that I would be "heavying up" on would be long U.S. Treasuries, which are the safest-haven investments in the world. Stay tuned, traders, the next few days should provide some more high drama in the world and trading and investing.--Jim
U.S. STOCK INDEXES
The U.S. stock indexes are solidly lower in early morning trading, amid a lack of a financial rescue plan agreement. The bears have downside technical momentum on their side. On the daily bar charts for the stock indexes, I still see bearish diamond patterns that have formed the past couple weeks.
December 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. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Today, shorter-term technical support comes in at the overnight low of 1,180.50. Sell stops likely reside just under that level. More sell stops likely reside under shorter-term technical support at 1,170.00. Upside resistance for active traders today is located at 1,200.00 and then at 1,210.00. Buy stops are likely located just above those levels. Wyckoff's Intra-day Market Rating: 4.0
Today's key near-term Fibonacci support/resistance level: 1,190.00.
PIVOT POINT LEVELS FOR DECEMBER S&P 500:
Pivot:------------ 1,208.05
1st Support:------ 1,191.60
2nd Support:------ 1,169.55
1st Resistance:--- 1,230.10
2nd Resistance:--- 1,246.55
December 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 to bearish early today. Shorter-term technical support is located at this week's low of 1,648.00. Sell stops likely reside just below that level, and then more sell stops are likely located just below technical support at the contract low of 1,612.00. On the upside, short-term resistance is seen at the overnight high of 1,683.00 and then at 1,701.00. Buy stops are likely located just above those levels. Wyckoff's Intra-Day Market Rating: 4.0
Today's key near-term Fibonacci support/resistance level: 1,678.00
PIVOT POINT LEVELS FOR DECEMBER NASDAQ:
Pivot:------------ 1,687.00
1st Support:------ 1,659.00
2nd Support:------ 1,638.00
1st Resistance:--- 1,708.00
2nd Resistance:--- 1,736.00
December Dow: Sell stops likely reside just below support at 10,800 and then more stops just below support at this week's low of 10,750. Buy stops likely reside just above shorter-term technical resistance at 10,900 and then just above resistance at 10,950. 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 neutral to bearish early today. Wyckoff's Intra-Day Market Rating: 3.0
Today's key near-term Fibonacci support/resistance level: 10,891
PIVOT POINT LEVELS FOR DECEMBER DOW:
Pivot:------------ 11,009
1st Support:------ 10,894
2nd Support:------ 10,769
1st Resistance:--- 11,134
2nd Resistance:--- 11,249
U.S. TREASURY BONDS AND NOTES
U.S. T-Bonds and T-Notes futures prices are higher early today, on a flight to quality move amid investor uncertainty. December 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 118 even and then at this week's high of 118 13/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at 117 even and then at the overnight low of 116 22/32. Sell stops likely reside just below those levels. Wyckoff's Intra-Day Market Rating: 6.0
Today's key near-term Fibonacci support/resistance level: 118 31/32
PIVOT POINT LEVELS FOR DECEMBER T-BONDS:
Pivot:----------- 116 25/32
1st Support:----- 116 5/32
2nd Support:----- 115 16/32
1st Resistance:-- 117 14/32
2nd Resistance:-- 118 2/32
December U.S. T-Notes: Shorter-term oscillators (RSI, slow stochastics) are bullish early today. Buy stops likely reside just above shorter-term technical resistance at this week's high of 115.21.0 and then at 116.00.0. 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 114.16.0 and then at the overnight low of 114.10.0. Wyckoff's Intra Day Market Rating: 6.0
Today's key near-term Fibonacci support/resistance level: 116.00.0
PIVOT POINT LEVELS FOR DECEMBER T-NOTES:
Pivot:----------- 114 15/32
1st Support:----- 113 25/32
2nd Support:----- 113 10/32
1st Resistance:-- 114 30/32
2nd Resistance:-- 115 20/32