Tuesday, July 7–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly lower in overnight trading. The U.S. stock indexes are pointed toward lower openings when the New York day session begins. Global equities markets on Tuesday are seeing corrective pullbacks and profit taking from the shorter-term futures traders, following recent solid gains. There were also some downbeat economic projections released Tuesday from the OECD think tank and the European Commission. The OECD said global unemployment in 2020 will be the highest since the Great Depression of the 1930s. The EC said the Euro zone economy will shrink by 8.3% this year, which is a greater decline than its earlier forecast of minus 7.4%. German industrial production also came in weaker than expected today.
The important outside markets today see Nymex crude oil prices lower and trading around $40.00 a barrel. The U.S. dollar index is higher early today. The yield on the benchmark U.S. Treasury 10-year note is currently around the 0.67% level.
U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, and the IBD-TIPP economic optimism index. Several Federal Reserve officials are slated to give speeches today.
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are lower in early U.S. trading, on a corrective pullback and profit taking. Bulls still have the firm overall near-term technical advantage. 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 is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at the overnight high of 3,184.00 and then at 3,200.00. Buy stops likely reside just above those levels. Downside support for active traders today is seen at Monday’s low of 3,105.75 and then at 3,062.75. Wyckoff’s Intra-day Market Rating: 4.0
September Nasdaq index futures: Prices are lower in early U.S. trading on profit taking after hitting a record high overnight. Bulls remain in solid overall technical control. 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 bullish early today. Shorter-term technical resistance is seen at the overnight record high of 10,664.50 and then at 10,750.00. On the downside, shorter-term support is seen at 10,500 and then at 10,400.00. Wyckoff’s Intra-Day Market Rating: 7.5.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are firmer in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at Monday’s high of 178 28/32 and then at 179 even. Shorter-term support lies at Monday’s low of 177 6/32 and then at 177 even. Wyckoff’s Intra-Day Market Rating: 5.5
September U.S. T-Notes: Prices are slightly up in early U.S. trading. Bulls still have the solid near-term technical advantage as prices trade sideways at higher levels. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at Monday’s high of 139.07.5 and then at last week’s high of 139.14.0. Shorter-term technical support lies at last week’s low of 138.23.5 and then at 138.20.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
The September Euro currency futures are lower in early U.S. trading. Bulls still have the overall near-term technical advantage. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is above the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are neutral to bearish early today. The Euro currency finds shorter-term technical resistance at Monday’s high of 1.1364 and then at 1.1371. Shorter-term support is seen at Monday’s low of 1.1236 and then at this week’s low of 1.1200. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
August Nymex crude oil prices are weaker in early U.S. trading. A price uptrend is in place on the daily chart. The shorter-term moving averages are bullish early today as the 4-day is above the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral to bearish early today. Look for buy stops to reside just above technical resistance at Monday’s high of $41.08 and then at the June high of $41.63. Look for sell stops just below technical support at the Monday’s low of $39.84 and then at $39.00. Wyckoff’s Intra-Day Market Rating: 4.0
US grain futures are mostly weaker in early U.S. pre-market trading, on corrective pullbacks from recent good gains. Still, a weather market is developing in the U.S. Corn Belt that could produce price uptrends in the near term. Speculators are getting more interested in the long side of the grain markets, along with the big “fund” shorts in the market having to capitulate.
IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any traders and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.
Here is what the Commodity Futures Trading Commission
(CFTC) has said about futures trading (and I agree 100%):
1. Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.