Friday, April 28–Jim Wyckoff’s morning markets report
Global stock markets were mostly higher overnight. U.S. stock indexes are pointed toward weaker openings when the New York day session begins, following solid gains posted Thursday that pulled the indexes out of their recent slump.
The U.S. data point of the day is the personal income and outlays report for March, which includes the closely watched PCE price index. The core PCE reading (excluding food and energy) is expected to come in at up 4.5%, year-on-year, compared to last month’s reading of up 4.6%. Also closely watched will be the employment cost index report for the first quarter, which is expected to come in at up 1.0% from the fourth quarter.
Traders and investors are already looking ahead to next week when the Federal Reserve’s Open Market Committee (FOMC) meets and is expected to raise the key U.S. interest rate by 0.25%. The European Central Bank also meets next week. The ECB is also expected to raise its main interest rate by a quarter-point.
The key outside markets today see the U.S. dollar index higher. Nymex crude oil prices are slightly up and trading around $75.00 a barrel. The benchmark 10-year U.S. Treasury note yield is presently fetching around 3.477%.
Other U.S. economic data due for release Friday includes the Chicago ISM business survey and the University of Michigan consumer sentiment survey.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are lower in early U.S. trading, on a corrective pullback from solid gains seen Thursday. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is even with the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Today, shorter-term technical resistance comes in at this week’s high of 4,166.50 and then at the April high of 4,198.25. Support for active traders is seen at 4,100.00 and then at this week’s low of 4,080.75. Wyckoff’s Intra-day Market Rating: 4.5
June Nasdaq index futures: Prices are slightly down in early U.S. trading, on a downside correction after strong gains posted Thursday. 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 early today. Shorter-term technical resistance is seen at the April high of 13,348.75 and then at 13,500.00 On the downside, shorter-term support is seen at 13,000.00 and then at this week’s low of 12,800.00. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are solidly up 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 bullish early today. Shorter-term technical resistance is seen at Thursday’s high of 131 20/32 and then at 132 even. Shorter-term support lies at 130 16/32 and then at this week’s low of 129 26/32. Wyckoff’s Intra-Day Market Rating: 6.0
June U.S. T-Notes: Prices are higher 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 bullish early today. Shorter-term resistance lies at Thursday’s high of 115.17.5 and then at this week’s high of 115.30.5. Shorter-term technical support is seen at this week’s low of 114.14.4 and then at 114.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
EURO CURRENCY
The June Euro currency futures are lower in early U.S. trading. Bulls have the solid overall near-term technical advantage. The shorter-term moving averages for the Euro 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 for the Euro are bearish early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.1129 and then at 1.1200. Shorter-term support is seen at 1.1000 and then at last week’s low of 1.0947. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
June Nymex crude oil prices are slightly up in early U.S. trading after dipping to a four-week low overnight. The shorter-term moving averages are bearish early today as the 4-day is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral early today. Look for buy stops to reside just above technical resistance at $75.83 and then at $77.00. Look for sell stops just below technical support at the overnight low of $73.93 and then at $72.50. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Grain futures prices were mostly higher overnight, on corrective bounces after this week’s drubbing. The technical postures for all the grain markets remain fully bearish. Generally good corn and soybean planting weather so far is bearish for the grains. Growing U.S. and/or global recession fears are also keeping the grain market bulls standing on the sidelines at present.
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