Daily Morning Report

Monday, October 19–Jim Wyckoff’s Morning Markets Report

Global stock markets were mixed overnight. U.S. stock indexes are set to open the New York day session higher. Trader and investor risk appetite is more upbeat to start the trading week, on renewed hopes for an agreement between U.S. congressional Democrats and Republicans on a stimulus package for Americans. House Speaker Nancy Pelosi over the weekend set a Tuesday deadline for an agreement with the White House. President Trump said he is closer to Democrats’ demandsfor a larger overall package than congressional Republicans. The Senate Wednesday plans to vote again on a $500 billion coronavirus aid package.

There was also upbeat economic data coming out of China, as its economy in the third quarter grew by 4.9%, which was slower than expected but still considered a good recovery from the business lockdowns experienced earlier in the year. China remains the fastest-recovering major economy, after the lockdowns.

Reports said new legislation passed Saturday enables the Chinese government to restrict rare earth mineral exports to foreign companies and nations. China had already been using access to rare earth minerals and other materials to persuade companies to set up manufacturing in China. However, the passing of official legislation on the matter marks an escalation of the strategy to control critical commodity markets and gain the upper hand on Western manufacturing. The legislation also applies to advanced technologies required by manufacturers such as LEDs, where China dominates global supply. The new law takes effect December 1.

The important outside markets early today see the U.S. dollar index lower. Nymex crude oil prices are modestly lower and trading around $40.60 a barrel. The yield on the benchmark U.S. 10-year Treasury note is 0.78% today.

U.S. economic data due for release Monday is light and includes the NAHB housing market index. Fed Chairman Powell also speaks today at an International Monetary Fund forum.

–Jim

U.S. STOCK INDEXES

December S&P 500 e-mini futures: Prices are higher in early U.S. trading. Bulls have the firm 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 even with 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 Friday’s high of 3,508.50 and then at 3,524.00. Buy stops likely reside just above those levels. Downside support for active traders today is seen at Friday’s low of 3,461.25 and then at last week’s low of 3,431.50. Wyckoff’s Intra-day Market Rating: 6.0

December Nasdaq index futures: Prices are higher 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 Friday’s high of 12,022.00 and then at 12,100.00. On the downside, shorter-term support is seen at the overnight low of 11,816.75 and then at last week’s low of 11,687.75. Wyckoff’s Intra-Day Market Rating: 6.5.

U.S. TREASURY BONDS AND NOTES FUTURES

December U.S. T-Bonds: 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 to bearish early today. Shorter-term technical resistance is seen at the overnight high of 174 27/32 and then at 175 even. Shorter-term support lies at 174 even and then at the October low of 173 11/32. Wyckoff’s Intra-Day Market Rating: 4.0

December 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 to bearish early today. Shorter-term resistance lies at 139.00.0 and then at 139.07.5. Shorter-term technical support lies at the overnight low of the October low of 138.22.5 and then at 138.18.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0

EURO CURRENCY

The December Euro currency futures are higher in early U.S. trading. 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 to bullish early today. The Euro currency finds shorter-term technical resistance at 1.1800 and then at the October high of 1.1847. Shorter-term support is seen at 1.1750 and then at last week’s low of 1.1702. Wyckoff’s Intra Day Market Rating: 6.5

NYMEX CRUDE OIL

November Nymex crude oil prices are a bit weaker in early U.S. trading. Price action has turned choppy and sideways. 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 early today. Look for buy stops to reside just above technical resistance at last week’s high of $41.29 and then at the October high of $41.47. Look for sell stops just below technical support at $40.00 and then at last week’s low of $39.04. Wyckoff’s Intra-Day Market Rating: 4.5

GRAINS

US grain futures are higher in early U.S. pre-market trading. Grain market bulls remain in solid technical control. Bullish speculators continue to be lured into the grain futures markets. There are no early clues to suggest that market tops are close at hand. 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

Friday, October 16–Jim Wyckoff’s Morning Markets Report

Global stock markets were mixed overnight. U.S. stock indexes are set to open the New York day session firmer. Traders and investors are more risk averse late this week, as Covid-19 cases are on the rise in many major world economies, including the U.S., and notions are growing that a big “second wave” of infections could again cripple economies, even if they don’t lock down to the degree seen this spring.

There are important U.S. economic reports out Friday, including retail sales and industrial production data. Retail sales in September are seen up 0.7% from August. Industrial production is seen up 0.5% in the same period.

The important outside markets early today see the U.S. dollar index weaker. Nymex crude oil prices are modestly lower and trading around $40.50 a barrel. The yield on the benchmark U.S. 10-year Treasury note is 0.724% today.

U.S. economic data due for release Friday includes retail sales, industrial production and capacity utilization, manufacturing and trade inventories, the University of Michigan consumer sentiment survey, and Treasury international capital data.

–Jim

U.S. STOCK INDEXES

December S&P 500 e-mini futures: Prices are modestly up in early U.S. trading. Bulls have the firm overall near-term technical advantage. However, more price pressure in the near term would create a bearish double-top reversal pattern on the daily bar chart. The shorter-term moving averages (4-, 9- and 18-day) are still bullish early today. The 4-day moving average is above 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 3,500.00 and then at 3,524.00. Buy stops likely reside just above those levels. Downside support for active traders today is seen at 3,450.00 and then at this week’s low of 3,431.50. Wyckoff’s Intra-day Market Rating: 5.5

December Nasdaq index futures: Prices are firmer 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 Thursday’s high of 11,983.25 and then at 12,100.00. On the downside, shorter-term support is seen at the overnight low of 11,825.50 and then at this week’s low of 11,736.50. Wyckoff’s Intra-Day Market Rating: 5.5.

U.S. TREASURY BONDS AND NOTES FUTURES

December U.S. T-Bonds: Prices are slightly higher in early U.S. trading. Bulls are having the better week. 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 176 even and then at this week’s high of 176 10/32. Shorter-term support lies at 175 even and then at 174 16/32. Wyckoff’s Intra-Day Market Rating: 5.5

December U.S. T-Notes: Prices are firmer 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 this week’s high of 139.14.0 and then at 139.20.0. Shorter-term technical support lies at the overnight low of 139.03.0 and then at 139.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5

EURO CURRENCY

The December Euro currency futures are higher in early U.S. trading. 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 Thursday’s high of 1.1772 and then at 1.1800. Shorter-term support is seen at this week’s low of 1.1702 and then at 1.1650. Wyckoff’s Intra Day Market Rating: 6.0

NYMEX CRUDE OIL

November Nymex crude oil prices are weaker in early U.S. trading. Price action has turned choppy and sideways. 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 bearish early today. Look for buy stops to reside just above technical resistance at this week’s high of $41.29 and then at the October high of $41.47. Look for sell stops just below technical support at $40.00 and then at this week’s low of $39.04. Wyckoff’s Intra-Day Market Rating: 4.5

GRAINS

US grain futures are higher in early U.S. pre-market trading. Grain market bulls remain in solid technical control and have gained more power late this week. There are no early clues to suggest that market tops are close at hand. On tap today is the weekly USDA export sales 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

Thursday, October 15–Jim Wyckoff’s Morning Markets Report

Global stock markets were mostly down overnight. U.S. stock indexes are set to open the New York day session solidly lower. The worrisome spread of the Covid-19 virus in major industrialized countries and elsewhere, with Europe getting hit extra hard, has traders and investors in more risk averse modes late this week. France declared a state of emergency on Wednesday, regarding the spreading virus.

Reports Wednesday the U.S. Congress is nowhere close to a second, new major stimulus package for Americans has also dampened trader and investor sentiment. The marketplace is also getting a bit more jittery ahead of the U.S. elections in less than three weeks.

Reports this week say China is looking to punish foreign nations and companies by restricting their access to rare earth minerals. The National People’s Congress is expected to review draft legislation on the matter ahead of its potential decree and implementation next year. The law would be a serious threat to western manufacturers, even though China has been limiting the availability of key rare earth minerals for some time by using export quotas and selling mainly to companies with manufacturing bases in China.

The important outside markets early today see the U.S. dollar index higher. Nymex crude oil prices are lower and trading around $40.00 a barrel. The yield on the benchmark U.S. 10-year Treasury note is 0.698% today.

The weekly U.S. jobless claims will be in focus during the U.S. trading session, with new claims seen at around 830,000 in the latest week.

Other U.S. economic data due for release Thursday includes the Empire State manufacturing survey, the Philadelphia Fed business survey, the weekly DOE liquid energy stocks report and import and export prices.

–Jim

U.S. STOCK INDEXES

December S&P 500 e-mini futures: Prices are down in early U.S. trading, on a corrective pullback after hitting a six-week high Monday. Bulls still have the firm overall near-term technical advantage. However, more price pressure in the near term would create a bearish double-top reversal pattern on the daily bar chart. The shorter-term moving averages (4-, 9- and 18-day) are still bullish early today. The 4-day moving average is above the 9-day and 18-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 3,486.50 and then at 3,500.00. Buy stops likely reside just above those levels. Downside support for active traders today is seen at the overnight low of 3,433.75 and then at 3,400.00. Wyckoff’s Intra-day Market Rating: 3.5

December Nasdaq index futures: Prices are lower on a corrective pullback after hitting a six-week high on Tuesday. Shorter-term moving averages (4- 9-and 18-day) are still 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 11,983.25 and then at 12,100.00. On the downside, shorter-term support is seen at the overnight low of 11,736.50 and then at 11,600.00. Wyckoff’s Intra-Day Market Rating: 3.5.

U.S. TREASURY BONDS AND NOTES FUTURES

December U.S. T-Bonds: Prices are higher and hit a two-week high in early U.S. trading. Bulls are having a good week. 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 the overnight high of 176 7/32 and then at 176 16/32. Shorter-term support lies at the overnight low of 175 7/32 and then at 175 even. Wyckoff’s Intra-Day Market Rating: 6.0

December U.S. T-Notes: Prices are firmer 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 the overnight low of 139.13.0 and then at 139.16.0. Shorter-term technical support lies at the overnight low of 139.06.0 and then at 139.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0

EURO CURRENCY

The December Euro currency futures are lower and hit a two-week low in early U.S. trading. 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 bearish early today. The Euro currency finds shorter-term technical resistance at the overnight high of 1.1772 and then at 1.1800. Shorter-term support is seen at the overnight low of 1.1717 and then at 1.1700. Wyckoff’s Intra Day Market Rating: 4.0

NYMEX CRUDE OIL

November Nymex crude oil prices are lower in early U.S. trading. Price action has turned choppy and sideways. The shorter-term moving averages are neutral early today as the 4-day is even with the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral to bearish early today. Look for buy stops to reside just above technical resistance at $41.00 and then at the October high of $41.47. Look for sell stops just below technical support at this week’s low of $39.04 and then at $38.00. Wyckoff’s Intra-Day Market Rating: 4.0

GRAINS

US grain futures are mixed to weaker in early U.S. pre-market trading. Markets this week are seeing a normal pause. Grain market bulls remain in firm technical control. This is normally a time of year when U.S. harvest pressure caps price gains. Such could continue to limit the upside in the near term.    

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, October 14–Jim Wyckoff’s Morning Markets Report

Global stock markets were mixed overnight. U.S. stock indexes are set to open the New York day session near steady levels. Featured in the stock markets this week is third-quarter earnings reports from major companies. The worrisome spreading of the Covid-19 virus in major industrialized countries and elsewhere has traders and investors tentative at mid-week. Microsoft founder Bill Gates, who has been studying pandemics for many years, said in a CNBC interview today that the U.S. should expect a “rough” next several months regarding the Covid-19 virus.

The approaching U.S. presidential election and doubts of any new U.S. stimulus package for Americans before the end of the year are also unknowns that have paused the stock indexes at mid-week.

From a charts perspective, the U.S. stock indexes have had a good run just recently and are due for normal, corrective pullbacks.

In overnight news, the Euro zone August industrial output came in at up 0.7% from July but down 7.4%, year-on-year. Those numbers were in line with market expectations.

The important outside markets early today see the U.S. dollar index slightly firmer. Nymex crude oil prices are weaker and trading around $40.00 a barrel. The yield on the benchmark U.S. 10-year Treasury note is 0.71% today.

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey and the producer price index.

–Jim

U.S. STOCK INDEXES

December S&P 500 e-mini futures: Prices are slightly down in early U.S. trading, on a corrective pullback after hitting a six-week high Monday. Bulls still have the solid 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 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 this week’s high of 3,541.00 and then at the September high of 3,576.75. Buy stops likely reside just above those levels. Downside support for active traders today is seen at this week’s low of 3,464.25 and then at 3,425.00. Wyckoff’s Intra-day Market Rating: 4.5

December Nasdaq index futures: Prices are weaker on a corrective pullback after hitting a six-week high on Tuesday. 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 the overnight high of 12,178.00 and then at this week’s high of 12,248.00. On the downside, shorter-term support is seen at 12,000.00 and then at 11,900.00. Wyckoff’s Intra-Day Market Rating: 4.5.

U.S. TREASURY BONDS AND NOTES FUTURES

December U.S. T-Bonds: Prices are higher in early U.S. trading on more short covering. 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 175 25/32 and then at 176 even. Shorter-term support lies at 175 even and then at Tuesday’s low of 174 8/32. Wyckoff’s Intra-Day Market Rating: 5.5

December U.S. T-Notes: Prices are firmer 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 139.12.0 and then at 139.16.0. Shorter-term technical support lies at the overnight low of 139.05.5 and then at 139.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5

EURO CURRENCY

The December Euro currency futures are slightly weaker in early U.S. trading. 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 1.1800 and then at last week’s high of 1.1847. Shorter-term support is seen at the overnight low of 1.1734 and then at 1.1700. Wyckoff’s Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

November Nymex crude oil prices are weaker in early U.S. trading. The shorter-term moving averages are neutral early today as the 4-day is above the 9-day. The 9-day is even with 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 Tuesday’s high of $40.53 and then at last week’s high of $41.47. Look for sell stops just below technical support at this week’s low of $39.04 and then at $38.00. Wyckoff’s Intra-Day Market Rating: 6.0

GRAINS

US grain futures are mixed to weaker in early U.S. pre-market trading. Markets this week are seeing a normal pause and downside corrections. Grain market bulls remain in firm technical control. This is normally a time of year when U.S. harvest pressure caps price gains. Such could continue to limit the upside in the near term. Remember that a bull market needs to be fed fresh, positive fundamental news very often, and the recent surge in demand for U.S. grains could be factored into prices.    

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