Friday, September 17-Jim Wyckoff's Morning Web Log JIM'S MARKET THOUGHT OF THE DAY * Commodity markets are rallying across the board Friday morning, led by the grains and by gold hitting another all-time record high overnight. Investment money continues to flow heavily into the commodity markets, and therefore individual market supply and demand fundamentals have taken a back seat to the money flows. When this phenomenon occurs in the commodity markets, the main thing for traders to focus upon is the key "outside markets" that are main drivers of the other markets. The major outside markets at present are the value of the U.S. dollar (U.S. dollar index) and the U.S. stock indexes. --Jim U.S. STOCK INDEXES S&P 500 futures: Prices hit a fresh four-month high overnight. The shorter-term moving averages (4-, 9- and 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. Short- term oscillators (RSI, slow stochastics) are neutral to bullish early today. Today, shorter-term technical resistance comes in at the overnight high of 1,132.70 and then at 1,140.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,122.50 and then at this week's low of 1,109.20. Sell stops are likely located just below those levels. Wyckoff's Intra-day Market Rating: 6.0 Nasdaq index futures: Prices hit a fresh four-month high overnight. The shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4- day moving average is above the 9-day and 18-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 resistance is located at the overnight high of 1,970.00 and then at 1,981.50. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 1,952.00 and then at 1,941.00. Sell stops are likely located just below those levels. Wyckoff's Intra-Day Market Rating: 6.0 Dow futures: Sell stops likely reside just below support at 10,550 and then more stops just below support at Wednesday's low of 10,500. Buy stops likely reside just above technical resistance at 10,650 and then at the August high of 10,685. 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 to bearish early today. Wyckoff's Intra-Day Market Rating: 6.0 U.S. TREASURY BONDS AND NOTES December U.S. T-Bonds: Shorter-term moving averages (4- 9- 18-day) are still 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 neutral early today. Shorter-term resistance lies at 130 16/32 and then at 131 even. Buy stops likely reside just above those levels. Shorter-term technical support lies at the 129 16/32 and then at the overnight low of 129 11/32. Sell stops likely reside just below those levels. Wyckoff's Intra-Day Market Rating: 5.5 DECEMBER U.S. T-Bonds 135 19/32--lifetime high 135 19/32--Previous Month's high 132 12/32--18-day moving average 131 27/32--second pivot point resistance 131 4/32--previous day's high 131 4/32--9-day moving average 130 26/32--first pivot point resistance 130 22/32--4-day moving average 130 4/32--pivot point 129 26/32--previous day's close 129 13/32--previous day's low 129 3/32--first pivot point support 128 13/32--second pivot point support 126 7/32--previous month's low 125 14/32--100-day moving average 112 --lifetime low December U.S. T-Notes: Shorter-term oscillators (RSI, slow stochastics) are neutral early today. Buy stops likely reside just above shorter-term technical resistance at this week's high of 124.16.0 and then at 124.24.0. Shorter-term moving averages are neutral early today. The 4-day moving average is above 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 123.16.5 and then at this week's low of 122.30.0. Wyckoff's Intra Day Market Rating: 5.5 DECEMBER U.S. T-Notes 126 2/32--lifetime high 126 2/32--previous month's high 124 27/32--second pivot point resistance 124 18/32--18-day moving average 124 15/32--previous day's high 124 12/32--first pivot point resistance 124 4/32--4-day moving average 124 3/32--9-day moving average 124 --pivot point 123 29/32--previous day's close 123 20/32--previous day's low 123 17/32--first pivot point support 123 5/32--second pivot point support 122 16/32--previous month's low 121 --100-day moving average 111 9/32--lifetime low U.S. DOLLAR INDEX The December U.S. dollar index is slightly lower in early trading and hit a fresh five-week low overnight. Slow stochastics for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at the overnight high of 81.60 and then at 82.00. Shorter-term support is seen at 81.24 and then at the overnight low of 81.07. Wyckoff's Intra Day Market Rating: 4.5 CRUDE OIL Crude oil prices are firmer early today on a short- covering bounce from recent selling pressure. Bulls have faded recently. In October crude, look for buy stops to reside just above resistance at $75.50 and then at $76.00. Look for sell stops just below technical support at Thursday's low of $74.11 and then at $73.50. Wyckoff's Intra-Day Market Rating: 5.5 GRAINS Prices were solidly higher in overnight trading, led by a surge in corn. Grain market bulls have near-term technical momentum on their side, as good speculator and fund interest continues to come to the grain markets. The technical charts also favor the grain market bulls at present. Look for corn to continue to be the leader of the grain markets in the near term.