Tuesday, February 22–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly lower overnight. The U.S. stock indexes are pointed toward weaker openings when the New York day session begins. Trader and investor risk aversion elevated following a three-day U.S. markets-holiday weekend. Russia has sent troops into breakaway parts of Ukraine, with Russian President Putin calling it a “peace-keeping” mission. The U.S. and the West have slapped new sanctions on Russia, including Germany halting operations on a key oil pipeline into Russia. The U.S. says Russia now has 190,000 troops at the Ukrainian border. This matter is likely to remain on the front burner of the marketplace for some time to come. “Markets are on war footing” was a news headline from Barrons today.
Gold prices hit an eight-month high of $1,918.00 an ounce overnight, on safe-haven demand.
The key outside markets today see Nymex crude oil prices sharply higher, hitting a 7.5-year high of $96.00 a barrel and presently trading around $94.25 a barrel. The U.S. dollar index is a bit weaker early today. The benchmark U.S. 10-year Treasury note is presently yielding 1.925%. U.S. Treasury yields are falling early this week, on safe-haven demand for U.S. debt.
U.S. economic data due for release Tuesday includes the monthly house price index, the quarterly house price index, the U.S. flash manufacturing and services purchasing managers indexes, the Richmond Fed business survey and the consumer confidence index.
–Jim
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are slightly lower and hit a four-week low in early U.S. trading. Prices are trending lower on the daily bar chart. 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 bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 4,391.25 and then at 4,425.00. Support for active traders is seen at 4,321.00 and then at 4,300.00. Wyckoff’s Intra-day Market Rating: 4.5
March Nasdaq index futures: Prices are lower in early U.S. trading and hit an eight-month low overnight. Shorter-term moving averages (4- 9-and 18-day) are bearish early today. The 4-day moving below the 9-day and 18-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at the overnight high of 14,157.50 and then at 14,300.00. On the downside, shorter-term support is seen at 14,706.00 and then at the overnight low of 13,580.25. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are slightly down in early U.S. trading. Bears still have the solid overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 153 16/32 and then at 154 even. Shorter-term support lies at the overnight low of 152 17/32 and then at 152 even. Wyckoff’s Intra-Day Market Rating: 4.5
March U.S. T-Notes: Prices are lower in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at 126.25.5 and then at 127.00.0. Shorter-term technical support lies at 126.07.0 and then at 126.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The March Euro currency futures are firmer in early U.S. trading. Bears have the overall near-term technical advantage. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is below the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at last week’s high of 1.1402 and then at 1.1450. Shorter-term support is seen at last week’s low of 1.1287 and then at 1.1250. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
March Nymex crude oil prices are solidly higher and hit a 7.5-year high in early U.S. trading. Bulls have the solid overall near-term technical advantage. 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 bullish today. Look for buy stops to reside just above technical resistance at the overnight high of $96.00 and then at $97.50. Look for sell stops just below technical support at $92.50 and then at $90.00. Wyckoff’s Intra-Day Market Rating: 6.5
GRAINS
U.S. grain futures are higher in early U.S. pre-market trading. Grain markets are seeing price gains on the uncertainty regarding the Russia-Ukraine conflict. Russia and Ukraine are major global wheat producers. Grain market bulls have the overall near-term technical advantage. On tap today is the weekly USDA export inspections report.
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.
Jim Wyckoff