Daily Morning Report

Friday, July 15–Jim Wyckoff’s Morning Markets Report

Global stock markets were mixed overnight. U.S. stock indexes are pointed toward firmer openings when the New York day session beings. It’s a busy U.S. data day to end the trading week, highlighted by the retail sales report for June. Sales are forecast up 0.9% compared to the May report that was down 0.3%.

Other U.S. economic data due for release Friday includes the Empire State manufacturing survey, import and export prices, industrial production and capacity utilization, manufacturing and trade inventories and the  University of Michigan consumer sentiment survey.

In overnight news, China, the world’s second-largest economy, reported its GDP cooled sharply in the second quarter due to Covid lockdowns. China’s GDP was up just 0.4%, year-on-year. That was below market expectations and the lowest since the first quarter of 2020, when the pandemic began.

The commodity markets have sent two strong, early signals to the marketplace the past couple weeks that traders and investors need to heed. Crude oil, gold, copper, silver, the grains, coffee, cotton and other markets have posted very sharp losses. Those two signals are one, that price inflation overall has very likely peaked, and two, that the U.S. and other major economies are on the verge of recession, if not already there. The smart money in the marketplace will not be making trades counter to those two strong signals.

The key outside markets today see Nymex crude oil prices higher and trading around $97.00 a barrel. The U.S. dollar index is weaker in early U.S. trading. The yield on the 10-year U.S. Treasury note is fetching 2.93%.

–Jim

U.S. STOCK INDEXES

September S&P 500 e-mini futures: Prices are slightly higher in early U.S. trading. Bears have the solid overall near-term technical advantage. 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 above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at 3,850.00 and then at 3,873.00. Support for active traders is seen at this week’s low of 3,723.75 and then at 3,700.00. Wyckoff’s Intra-day Market Rating: 5.5

September Nasdaq index futures: Prices are slightly up in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 12,000.00 and then at the July high of 12,211.00. On the downside, shorter-term support is seen at this week’s low of 11,479.25 and then at the July low of 11,381.75. Wyckoff’s Intra-Day Market Rating: 5.5.

U.S. TREASURY BONDS AND NOTES FUTURES

September U.S. T-Bonds: Prices are higher in early U.S. trading. Bears are in overall near-term technical control. 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 neutral early today. Shorter-term technical resistance is seen at this week’s high of 140 14/32 and then at 141 even. Shorter-term support lies at 139 even and then at 138 even. Wyckoff’s Intra-Day Market Rating: 5.5

September U.S. T-Notes: Prices are higher in early U.S. trading. Bears are in overall near-term technical control. 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 neutral early today. Shorter-term resistance lies at 119.00.0 and then at this week’s high of 119.06.0. Shorter-term technical support lies at 118.00.0 and then at this week’s low of 117.18.5. 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 up in early U.S. trading. Bears have the strong overall near-term technical advantage. The shorter-term moving averages for the Euro 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 for the Euro are neutral to bullish early today. The Euro currency finds shorter-term technical resistance at Wednesday’s high of 1.0172 and then at 1.0200. Shorter-term support is seen at this week’s low of 1.0000 and then at .9950. Wyckoff’s Intra Day Market Rating: 5.0

NYMEX CRUDE OIL

Nymex crude oil prices are higher in early U.S. trading, on short covering after hitting a three-month low Thursday. Bears have the near-term technical advantage. 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 $100.00 and then at $102.00. Look for sell stops just below technical support at $95.00 and then at $93.00. Wyckoff’s Intra-Day Market Rating: 6.0

GRAINS

U.S. grain futures were mixed to slightly up overnight. Bears are in firm near-term technical control. Attention remains on weather forecasts for the Corn Belt, which are now for mostly warmer and drier conditions the next two weeks. Today’s trading will be important, as traders may add some weather premium back into futures prices, as the Corn Belt forecast tilts in favor of the bulls.

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

Thursday, July 14–Jim Wyckoff’s Morning Markets Report

Global stock markets were mostly down overnight. U.S. stock indexes are pointed toward lower openings when the New York day session beings. Trader and investor risk aversion is keener late this week, following Wednesday’s U.S. consumer price index report that ran hotter than expected at up 9.1% in June, year-on-year, and at a 41-year high. On tap today is the U.S. producer price index report for June, which is expected to see a rise of 0.8% from May, following May’s reading of up 0.8% from April.

A feature in the marketplace for some time has been the strong appreciation of the U.S. dollar against other major currencies. Today, the U.S. dollar index, which is a basket of six major currencies weighted against the greenback, hit another 20-year high. The significant interest rate differentials in major economies, with the U.S. rates being higher, is prompting the so-called “carry trade” to be prominent, whereby international traders and institutions swap out their own currencies in favor of owning the U.S. dollar. History suggests this phenomenon can remain in place for quite some time, only making the greenback stronger.

The other feature is this week’s big downdraft in crude oil futures prices, with Nymex futures overnight falling to a three-month low of $93.24 a barrel. January crude oil futures are now trading at $84 a barrel, suggesting the marketplace thinks crude prices will continue to decline in the coming months. Crude’s plunge has pulled other major commodity market prices down, too. The weakening raw commodity sector is one significant early clue that inflationary pressures have peaked.

The key outside markets today see Nymex crude oil prices lower and trading around $93.75 a barrel. The U.S. dollar index is higher and hit a 20-year high following the hot CPI report Wednesday. The yield on the 10-year U.S. Treasury note is fetching 2.982%. The 2-year/10-year Treasury note yield curve remains inverted and at its most inverted in 22 years. Such is a clue of impending U.S. economic recession.

U.S. economic data due for release Thursday includes the weekly jobless claims report and the PPI.

–Jim

U.S. STOCK INDEXES

September S&P 500 e-mini futures: Prices are solidly lower in early U.S. trading. Bears have the solid overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 3,806.25 and then at 3,850.00. Support for active traders is seen at the July low of 3,744.00 and then at 3,700.00. Wyckoff’s Intra-day Market Rating: 4.0

September Nasdaq index futures: Prices are down in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at Wednesday’s high of 11,970.00 and then at the July high of 12,211.00. On the downside, shorter-term support is seen at this week’s low of 11,479.25 and then at the July low of 11,381.75. Wyckoff’s Intra-Day Market Rating: 4.0.

U.S. TREASURY BONDS AND NOTES FUTURES

September U.S. T-Bonds: Prices are lower in early U.S. trading. Bears are in overall near-term technical control. 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 technical resistance is seen at this week’s high of 140 14/32 and then at 141 even. Shorter-term support lies at 139 even and then at 138 even. Wyckoff’s Intra-Day Market Rating: 4.0

September U.S. T-Notes: Prices are lower in early U.S. trading. Bears are in overall near-term technical control. 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 bearish early today. Shorter-term resistance lies at this week’s high of 119.06.0 and then at 119.16.0. Shorter-term technical support lies at 118.00.0 and then at this week’s low of 117.18.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0

EURO CURRENCY

The September Euro currency futures are slightly lower in early U.S. trading. Bears have the strong overall near-term technical advantage. The shorter-term moving averages for the Euro 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 for the Euro are bearish early today. The Euro currency finds shorter-term technical resistance at Wednesday’s high of 1.0172 and then at 1.0200. Shorter-term support is seen at this week’s low of 1.0046 and then at 1.0000. Wyckoff’s Intra Day Market Rating: 4.0

NYMEX CRUDE OIL

Nymex crude oil prices are lower in early U.S. trading and hit a three-month low overnight. Bears have the near-term technical advantage. 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 bearish early today. Look for buy stops to reside just above technical resistance at $95.00 and then at the overnight high of $97.00. Look for sell stops just below technical support at $92.00 and then at $90.00. Wyckoff’s Intra-Day Market Rating: 4.0

GRAINS

U.S. grain futures were weaker overnight. Bears are in firm near-term technical control. Attention remains on weather forecasts for the Corn Belt, which are for mostly warmer conditions but with better rain chances the next two weeks. Traders are reading that as being benign for the grain markets, at present. But remember that Corn Belt weather in the summertime can “change on a dime.” 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

Wednesday, July 13–Jim Wyckoff’s Morning Markets Report

Global stock markets were mixed overnight. U.S. stock indexes are pointed toward slightly higher lower openings on tepid corrective bounces from this week’s selling pressure. The U.S. data point of the week, if not the month, will be Wednesday morning’s consumer price index report for June, which is seen coming in hot at up 8.5%, year-on-year. In the May report, CPI was up 8.6% annually.

Traders are still buzzing about Tuesday’s big downdraft in crude oil futures prices, with Nymex futures falling to a 2.5-month low of $93.67 overnight. Crude’s plunge pulled other major commodity market prices down, too. The weakening raw commodity sector is an early clue that inflationary pressures may have peaked.

In other overnight news, China’s exports rose in June by 17.9%, year-on-year, which was above market expectations. However, imports rose only 1.0% in the same period. Analysts expect China’s second-quarter GDP to be up only 0.9%, compared to a rise of 4.8% in the first quarter.

The key outside markets today see Nymex crude oil prices firmer on a corrective bounce after Tuesday’s strong losses, and trading around $96.50 a barrel. The U.S. dollar index is down after hitting after hitting a 20-year high Tuesday. The yield on the 10-year U.S. Treasury note is fetching 2.972%.

Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, real earnings, the weekly DOE liquid energy stocks report, the monthly Treasury budget statement and the Federal Reserve’s beige book.

–Jim

U.S. STOCK INDEXES

September S&P 500 e-mini futures: Prices are slightly higher in early U.S. trading. Bears 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 last week’s high of 3,922.00 and then at 3,950.00. Support for active traders is seen at 3,800.00 and then at the July low of 3,744.00. Wyckoff’s Intra-day Market Rating: 5.5

September Nasdaq index futures: Prices are slightly up in early U.S. trading. 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 early today. Shorter-term technical resistance is seen at 12,000.00 and then at last week’s high of 12,211.00. On the downside, shorter-term support is seen at this week’s low of 11,712.00 and then at 11,500.00. Wyckoff’s Intra-Day Market Rating: 5.5.

U.S. TREASURY BONDS AND NOTES FUTURES

September U.S. T-Bonds: Prices are slightly higher in early U.S. trading. Bears are still in overall near-term technical control. 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 this week’s high of 140 12/32 and then at the July high of 142 6/32. Shorter-term support lies at 139 even and then at 138 even. Wyckoff’s Intra-Day Market Rating: 5.5

September U.S. T-Notes: Prices are firmer in early U.S. trading. Bears are in overall near-term technical control. 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 resistance lies at this week’s high of 119.03.0 and then at 119.10.0. Shorter-term technical support lies at the overnight low of 118.13.5 and then at 118.00.0. 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. Bears have the strong overall near-term technical advantage. The shorter-term moving averages for the Euro 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 for the Euro are neutral to bullish early today. The Euro currency finds shorter-term technical resistance at 1.0150 and then at 1.0200. Shorter-term support is seen at this week’s low of 1.0048 and then at 1.0000. Wyckoff’s Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

Nymex crude oil prices are firmer in early U.S. trading after hitting a 2.5-month low overnight. Bears have the near-term technical advantage. 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 early today. Look for buy stops to reside just above technical resistance at $98.00 and then at $100.00. Look for sell stops just below technical support at $95.00 and then at the overnight low of $93.67. Wyckoff’s Intra-Day Market Rating: 5.5

GRAINS

U.S. grain futures were mixed overnight. Bears are again in firm near-term technical control after Tuesday’s major losses. There was a “flash” weather market in the grains that lasted only two trading sessions. Attention remains on weather forecasts for the Corn Belt, which are now for mostly warmer and drier conditions the next two weeks, but with scattered rain chances. Traders are reading that as being benign for the grain markets, at present. But remember that Corn Belt weather in the summertime can “change on a dime.”

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

Tuesday, July 12–Jim Wyckoff’s Morning Markets Report

Global stock markets were mostly weaker overnight. U.S. stock indexes are pointed toward lower openings when the New York day session begins. Trader and investor risk appetite remains dented amid recession and inflation fears. Asian countries are also dealing with the worrisome spread of Covid.

The U.S. data point of the week will be Wednesday’s consumer price index report for June, which is seen coming in up 8.5%, year-on-year. In the May report, CPI was up 8.6% annually.

The key outside markets today see Nymex crude oil prices solidly down and trading around $99.50 a barrel. The U.S. dollar index is up and hit another 20-year high early today. The yield on the 10-year U.S. Treasury note is fetching 2.921%.

U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and chain stores sales indexes, the NFIB small business index, and the IBD/TIPP economic optimism index.

–Jim

U.S. STOCK INDEXES

September S&P 500 e-mini futures: Prices are lower again in early U.S. trading. Bears 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 bearish early today. Today, shorter-term technical resistance comes in at last week’s high of 3,922.00 and then at 3,950.00. Support for active traders is seen at 3,800.00 and then at the July low of 3,744.00. Wyckoff’s Intra-day Market Rating: 4.0

September Nasdaq index futures: Prices are weaker in early U.S. trading. 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 bearish early today. Shorter-term technical resistance is seen at last week’s high of 12,211.00 and then at 12,500.00. On the downside, shorter-term support is seen at the overnight low of 11,758.25 and then at 11,500.00. Wyckoff’s Intra-Day Market Rating: 4.0.

U.S. TREASURY BONDS AND NOTES FUTURES

September U.S. T-Bonds: Prices are higher in early U.S. trading. Bears are still in overall near-term technical control. 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 neutral to bullish early today. Shorter-term technical resistance is seen at 141 even and then at the July high of 142 6/32. Shorter-term support lies at 139 even and then at the overnight low of 138 18/32. Wyckoff’s Intra-Day Market Rating: 6.5

September U.S. T-Notes: Prices are higher in early U.S. trading. Bears are in overall near-term technical control. 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 to bullish early today. Shorter-term resistance lies at the overnight high of 119.03.0 and then at 119.10.0. Shorter-term technical support lies at 118.20.0 and then at the overnight low of 118.09.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.5

EURO CURRENCY

The September Euro currency futures are lower and hit another 20-year low in early U.S. trading. Bears have the strong overall near-term technical advantage. The shorter-term moving averages for the Euro 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 for the Euro are bearish early today. The Euro currency finds shorter-term technical resistance at 1.0150 and then at 1.0200. Shorter-term support is seen at the overnight low of 1.0048 and then at 1.0000. Wyckoff’s Intra Day Market Rating: 3.5

NYMEX CRUDE OIL

Nymex crude oil prices are solidly lower in early U.S. trading. 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 bearish early today. Look for buy stops to reside just above technical resistance at $101.00 and then at $102.00. Look for sell stops just below technical support at $97.00 and then at the July low of $95.10. Wyckoff’s Intra-Day Market Rating: 4.0

GRAINS

U.S. grain futures were lower overnight. It appears there was a “flash” weather market in the grains that has already fizzled. Still, recent solid gains suggest near-term market bottoms are in place. On tap today is the monthly USDA supply and demand report. Then attention will return to weather forecasts for the Corn Belt, which remain mostly warmer and drier, but with scattered rain chances. Recent price action in the grains does lay out the likely trading ranges for them in the coming weeks: the mid-to-late-June highs to the July lows.

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