Wednesday, June 14–Jim Wyckoff’s morning markets report
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins. Traders are awaiting Wednesday morning’s U.S. producer price index report for May, which is seen down 0.1%, month-on-month. A Wall Street Journal headline reads: “Inflation cut in half in May from peak last year.”
The U.S. data point of the week is the FOMC meeting of the Federal Reserve, that began Tuesday morning and ends Wednesday afternoon with a statement and press conference from Fed Chairman Powell. A majority of the marketplace thinks the Fed will pause in its interest-rate-tightening cycle. Tuesday’s CPI report that came in as expected at up 4.0%, year-on-year, falls into the camp of those expecting the Fed to pause at this week’s FOMC meeting. The European Central Bank meets Thursday and is expected to raise its main interest rate by 25 basis points.
The key outside markets today see the U.S. dollar index lower. Nymex crude oil prices are higher and trading around $70.50 a barrel. Meantime, the benchmark 10-year U.S. Treasury note yield is presently fetching 3.81%.
Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey and the weekly DOE liquid energy stocks report.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are slightly higher in early U.S. trading and hit another 10-month high. Bulls have the solid 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 to bullish early today. Today, shorter-term technical resistance comes in at 4,450.00 and then at 4,475.00. Support for active traders is seen at Tuesday’s low of 4,381.75 and then at this week’s low of 4,348.75. Wyckoff’s Intra-day Market Rating: 6.0
September Nasdaq index futures: Prices are slightly up in early U.S. trading and hit another 10-month high overnight. Bulls have the solid near-term technical advantage. 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 neutral to bullish early today. Shorter-term technical resistance is seen at 15,250.00 and then at 15,400.00. On the downside, shorter-term support is seen at Tuesday’s low of 14,963.00 and then at this week’s low of 14,732.00. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are slightly 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 even with the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at 127 even and then at 128 even. Shorter-term support lies at the June low of 125 27/32 and then at 125 even. Wyckoff’s Intra-Day Market Rating: 5.5
September U.S. T-Notes: Prices are firmer in early U.S. trading. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 113.00.0 and then at 113.10.0. Shorter-term technical support is seen at this week’s low of 112.20.5 and then at 112.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The September Euro currency futures are slightly higher in early U.S. trading. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are bullish early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.0881 and then at 1.0900. Shorter-term support is seen at this week’s low of 1.0792 and then at 1.0750. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
July Nymex crude oil prices are higher in early U.S. trading on a corrective bounce from recent losses. The shorter-term moving averages are bearish early today as the 4-day is below the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral to bullish early today. Look for buy stops to reside just above technical resistance at $71.00 and then at $72.00. Look for sell stops just below technical support at the overnight low of $69.07 and then at $68.00. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
Grain futures prices were lower overnight. Corn and soybean market bulls have the near-term technical advantage. Wheat markets are still bearish. Weather in the Corn Belt leans slightly bullish for the grain markets, as it is dry in some regions. Don’t be surprised if some degree of a weather market scare pops up in the near term. Late June and early July is a critical timeframe for the grain markets.
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