Daily Morning Report

Monday, September 24–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mostly lower overnight. U.S. stock indexes are pointed toward weaker openings when the New York day session begins. There is a bit more risk aversion in the world marketplace to start the trading week, as U.S.-China trade tensions are back on the front burner after China accused President Trump of being a trade bully and cancelled trade talks that had been set up for this week. And tariffs on $200 billion more in Chinese imports to the U.S. are set to kick in today. Stocks markets in China, Japan and South Korea were closed Monday for a holiday.

Focus this week will also be the Federal Reserve’s two-day Open Market Committee (FOMC) meeting that begins Tuesday. The FOMC is expected to slightly raise U.S. interest rates at this meeting. Fed Chairman Jerome Powell will also hold a press conference after the meeting.

The key outside markets today find the U.S. dollar index lower. Prices Friday hit a 2.5-month low. The greenback bears have downside technical momentum to suggest a market top is in place for the USDX. Meantime, November Nymex crude oil prices are solidly higher and hit a contract high today, and trading just above $72.00 a barrel.

U.S. economic data due for release today includes the Chicago Fed national activity index and the Texas manufacturing outlook survey.

–Jim

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Friday, September 21–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mostly firmer overnight. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins. The S&P 500 and Dow stock indexes are at record highs. There is little risk aversion in the world marketplace at present.

Goldman Sachs is predicting the U.S.-China trade war will be extended and will eventually see the U.S. putting tariffs on all Chinese imports into the U.S. Earlier this week, Alibaba founder Jack Ma said the U.S.-China trade war could last many years.

A feature in the marketplace this week has been falling U.S. Treasury prices (rising yields). The U.S. 10-year T-Note is presently yielding around 3.07%.

Traders and investors are looking ahead to next week, when the Federal Reserve’s Open Market Committee (FOMC) meets to discuss U.S. monetary policy. Many believe the Fed will make a slight interest rate increase at the meeting.

The key outside markets today find the U.S. dollar index mildly up on a corrective rebound from this week’s selling pressure that drove prices to a 2.5-month low on Thursday. The greenback bears have downside technical momentum to suggest a market top is in place for the USDX. Meantime, Nymex crude oil prices are firmer and trading just below $71.00 a barrel. Around present price levels rallies have been capped several times this year.

U.S. economic data due for release Friday includes the flash services purchasing managers index (PMI) and the flash manufacturing PMI.

–Jim

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he U.S. Treasury bonds and notes futures markets are trending lower and hit four-month lows this week. The U.S. Treasury bears have the near-term technical advantage, which suggests more sideways-to-lower price action in the coming days, or longer. Stay tuned!

Thursday, September 20–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mixed to firmer overnight. U.S.
stock indexes are pointed toward slightly higher openings
when the New York day session begins. It’s been a quieter
week on the fundamental news front, with the ongoing U.S.-
China trade war the main focus. However, traders and
investors are fatigued with that news and the markets are
reacting less and less to the latest salvos.

In overnight news, Turkey’s finance minister said his
country will experience lower economic growth and higher
inflation in the coming two years, with annual inflation
reaching a whopping 20%. The Turkish lira is down 40%
against the U.S. dollar this year.

Japan’s prime minister Abe on Thursday was re-elected as
his party’s leader by a landslide.

The key outside markets today find the U.S. dollar index
lower as the bulls are fading this week. Meantime, Nymex
crude oil prices are firmer and trading around $71.50 a
barrel. However, around present price levels rallies have
been capped several times this year.

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Wednesday, September 19–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mixed to firmer overnight. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins. There continues to be little to sometimes only modest risk aversion in the world marketplace at present.

Amid a lack of other fresh fundamental news so far this week, focus remains on the trade war between the U.S. and China. The U.S. hit China with more tariffs this week and China vowed to retaliate. Many traders and investors took note Tuesday of a comment by Alibaba founder Jack Ma, who said the trade dispute between the world’s two largest economies could take decades to resolve. Ma implied that the Chinese culture won’t allow that nation to “give in.” But Americans reckon President Trump won’t either. The U.S.-China trade war and the recent strength of the U.S. dollar have hit emerging markets and their currencies hard the past few months.

The key outside markets today find the U.S. dollar index weaker and Nymex crude oil prices slightly down and trading just below $70.00 a barrel.

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, new residential construction and the weekly DOE liquid energy stocks report.

–Jim

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The Nymex crude oil futures market once again saw a price rally turned back by stiff technical resistance layers that are located just above present price levels. Four times in the past few months rallies have been halted by the chart resistance around and just above $71.00 a barrel. Such suggests sideways-at-best trading action for the crude oil market in the coming weeks, or longer, barring a major geopolitical event in the oil-rich Middle East or in some other oil-producing region of the world. Stay tuned!