Wednesday, June 22–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 begins, after posting solid gains Tuesday. It’s a risk-off trading day at mid-week, amid ongoing inflation, U.S. recession and geopolitical worries.
Inflation continues to run hot in Europe. The U.K. today reported its May consumer inflation was up 9.1%, which is a 40-year high.
The key outside markets today see Nymex crude oil prices solidly lower and trading around $104.75 a barrel. The U.S. dollar index is a bit firmer in early trading. The yield on the 10-year U.S. Treasury note is fetching 3.218%.
U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey and the Johnson Redbook weekly retail sales report.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are lower in early U.S. trading and not far above the recent contract low. 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 neutral to bearish early today. Today, shorter-term technical resistance comes in at this week’s high of 3,783.75 and then at 3,843.00. Support for active traders is seen at the overnight low of 3,693.25 and then at this week’s low of 3,661.50. Wyckoff’s Intra-day Market Rating: 4.0
September Nasdaq index futures: Prices are lower in early U.S. trading and close to last week’s contract low. 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 to bearish early today. Shorter-term technical resistance is seen at the overnight high of 11,583.00 and then at this week’s high of 11,678.25. On the downside, shorter-term support is seen at this week’s low of 11,273.75 and then at the contract low of 11,068.50. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are solidly higher in early U.S. trading, on short covering. Bears are still in solid overall near-term technical control. 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 136 even and then at 137 even. Shorter-term support lies at 134 even and then at this week’s low of 133 9/32. Wyckoff’s Intra-Day Market Rating: 6.0
September U.S. T-Notes: Prices are solidly higher in early U.S. trading, on short covering. Bears are still in solid 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 below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term resistance lies at 117.00.0 and then at 117.16.0. Shorter-term technical support lies at 116.00.0 and then at this week’s low of 115.22.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
EURO CURRENCY
The September Euro currency futures are slightly lower in early U.S. trading. Bears have the solid 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 early today. The Euro currency finds shorter-term technical resistance at last week’s high of 1.0668 and then at 1.0700. Shorter-term support is seen at the overnight low of 1.0534 and then at 1.0500. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
Nymex crude oil prices are solidly lower and hit a four-week low in early U.S. trading. 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 bearish early today. Look for buy stops to reside just above technical resistance at $106.00 and then at $107.00. Look for sell stops just below technical support at the overnight low of $103.20 and then at $102.00. Wyckoff’s Intra-Day Market Rating: 3.5
GRAINS
U.S. grain futures prices were mixed in early U.S. pre-market trading. Grain market bulls have faded recently, with wheat suffering serious chart damage and corn also seeing some near-term technical damage. Weather in the U.S. Corn Belt is so far non-threatening. I still look for a sideways, trading-range grind the next two weeks, into the key Fourth-of-July holiday period.
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