Daily Morning Report

Tuesday, October 10–Jim Wyckoff’s morning markets report

Asian and European stocks were mostly higher overnight. U.S. stock indexes are pointed to firmer openings when the New York day session begins.

The marketplace is keenly focused on the Middle East as Israel has declared war on Hamas. Many veteran market watchers, including this one, have been surprised the marketplace has not reacted more strongly to the major geopolitical crisis. The Wall Street Journal reported financial markets reacted more strongly to last Friday’s U.S. jobs report than they did to the weekend violence in the Middle East that for Israel was the worst in 50 years. One respected CNBC commentator summed it up by saying at present the marketplace is not factoring in a further escalation in the Israel-Hamas conflict, meaning no other countries like Iran, Syria or the U.S. will become significantly involved. Many times when unexpected market shocks like this one occur, traders and investors quickly factor into market prices a worst-case outcome, on a knee-jerk reaction. Then, as the worst-case scenario does not play out, market prices begin to retrace their initial big moves. Not the case this time. This veteran market watcher finds it unlikely the Israel-Hamas war will not significantly involve any of the aforementioned countries, which would mean a significant escalation in the conflict. To put in simply: This matter will very likely get worse before it gets better. Beware traders and investors.

The key outside markets today see the U.S. dollar index modestly lower. Nymex crude oil prices are near steady and trading around $86.25 a barrel. The yield on the benchmark U.S. Treasury 10-year note yield is presently fetching 4.67%. The yield has down-ticked a bit early this week on flight-to-quality buying amid the Middle East turmoil.

U.S. economic data due for release Tuesday includes the NFIB small business index, the Johnson Redbook retail sales report and monthly wholesale trade.

U.S. STOCK INDEXES

December S&P 500 e-mini futures: Prices are slightly up in early U.S. trading and hit a two-week high. A 2.5-month-old downtrend on the daily bar chart has been negated. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at 4,400.00 and then at 4,450.00. Support for active traders is seen at 4,330.00 and then at 4,300.00. Wyckoff’s Intra-day Market Rating: 5.5

December Nasdaq index futures: Prices are slightly higher and hit a three-week high in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at 15,300.00 and then at 15,500.00. On the downside, shorter-term support is seen at 15,100.00 and then at 15,000.00. Wyckoff’s Intra-Day Market Rating: 5.5.

U.S. TREASURY BONDS AND NOTES FUTURES

December U.S. T-Bonds: Prices are weaker in early U.S. trading and not far above last Friday’s contract low. 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 neutral early today. Shorter-term technical resistance is seen at the overnight high of 112 15/32 and then at 113 even. Shorter-term support lies at this week’s low of 110 11/32 and then at 110 even. Wyckoff’s Intra-Day Market Rating: 4.5

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 even with the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at the overnight high of 107.30.5 and then at 108.10.0. Shorter-term technical support is seen at this week’s low of 107.02.05 and then at 106.24.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0

EURO CURRENCY

The December Euro currency futures are firmer in early U.S. trading. Prices are still trending lower and bears are in solid overall near-term technical control. 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 bullish early today. The Euro currency finds shorter-term technical resistance at 1.0650 and then at 1.0700. Shorter-term support is seen at this week’s low of 1.0551 and then at 1.0500. Wyckoff’s Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

November Nymex crude oil prices are weaker 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 neutral to bearish early today. Look for buy stops to reside just above technical resistance at this week’s high of $87.24 and then at $88.00. Look for sell stops just below technical support at this week’s low of $84.67 and then at $83.00. Wyckoff’s Intra-Day Market Rating: 4.5

GRAINS

Grain futures prices were lower in overnight trading. Keener risk aversion in the marketplace this week is bearish for the grains. Harvesting of soybeans and corn is in full swing and that is also a bearish seasonal factor amid commercial hedge selling. Technicals are bearish for corn, wheat and soybeans. On tap today is the weekly USDA export inspections report and the weekly USDA crop progress reports.

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

Monday, October 9–Jim Wyckoff’s morning markets report

Asian and European stocks were mostly lower overnight. U.S. stock indexes are pointed to lower openings when the New York day session begins. The marketplace got a rare, major geopolitical shock over the weekend when Hamas raided Israel, killing hundreds of civilians and taking hostages. Israel retaliated harshly and declared war on Hamas. This is the largest act of violence seen in Israel in 50 years. Risk aversion is high to start the trading week, as the ramifications of the weekend attack by Hamas are huge, both politically and economically. The U.S. is building up its military presence in the Middle East region.

The major Middle East conflict will likely in the coming months impact major economies, including affecting central bank policies. There is also speculation the Israel war with Hamas may even impact the U.S. Congress and the process of selecting a new Speaker of the House of Representatives.

The U.S. government is closed for a federal holiday Monday, so the U.S. Treasury market is closed. However, most markets are open today, including the U.S. Treasury futures markets.

Gold prices are sharply higher on safe-haven demand, while the U.S. dollar and U.S. Treasuries are also seeing “flight-to-quality” buying. Nymex crude oil prices are sharply higher and trading around $85.50 a barrel. The yield on the benchmark U.S. Treasury 10-year note yield is presently fetching 4.795%.

U.S. economic data due for release Monday includes the employment trends index.

U.S. STOCK INDEXES

December S&P 500 e-mini futures: Prices are lower in early U.S. trading. Prices are in a 2.5-month-old downtrend on the daily bar chart. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at last week’s high of 4,358.50 and then at 4,400.00. Support for active traders is seen at 4,270.00 and then at the October low of 4,235.50. Wyckoff’s Intra-day Market Rating: 4.0

December Nasdaq index futures: Prices are lower in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above the 9-day. Both are below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at last week’s high of 15,160.25 and then at 15,300.00. On the downside, shorter-term support is seen at 14,800.00 and then at the September low of 14,586.00. Wyckoff’s Intra-Day Market Rating: 4.0.

U.S. TREASURY BONDS AND NOTES FUTURES

December U.S. T-Bonds: Prices are firmer in early U.S. trading and not far above Friday’s contract low. 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 neutral to bullish early today. Shorter-term technical resistance is seen at Tuesday’s high of 111 even and then at 112 even. Shorter-term support lies at 110 even and then at the contract low of 109 20/32. Wyckoff’s Intra-Day Market Rating: 5.5

December U.S. T-Notes: Prices are higher 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 and 18-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 high of 107.20.5 and then at last week’s high of 107.29.5. Shorter-term technical support is seen at 107.00.00 and then at 106.16.0. 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 in early U.S. trading. Prices are trending lower and bears are in solid near-term technical control. 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 1.0632 and then at 1.0700. Shorter-term support is seen at 1.0500 and then at the October low of 1.0482. Wyckoff’s Intra Day Market Rating: 4.0

NYMEX CRUDE OIL

November Nymex crude oil prices are sharply up 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 neutral to bullish early today. Look for buy stops to reside just above technical resistance at the overnight high of $87.24 and then at $88.00. Look for sell stops just below technical support at the overnight low of $84.67 and then at $83.00. Wyckoff’s Intra-Day Market Rating: 7.0

GRAINS

Grain futures prices were higher in overnight trading. Harvesting of soybeans and corn is in full swing and that is a bearish seasonal factor amid commercial hedge selling. Technicals are bearish for corn, wheat and soybeans. USDA today is closed, so no reports today.

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 6–Jim Wyckoff’s morning markets report

Asian and European stocks were mixed but mostly higher overnight. U.S. stock indexes are pointed to firmer openings when the New York day session begins.

Traders are looking ahead to Friday morning’s important September employment situation report from the Labor Department. The key non-farm payrolls number is expected to come in at up 170,000 compared to a rise of 187,000 in the September report. Wednesday’s big downside miss in the ADP jobs report has many thinking the more important jobs report Friday morning will also be a miss to the downside. A weakening U.S. economy would actually be a good thing of sorts for the marketplace, in that it would likely cool the ascent in bond yields.

The key outside markets today see the U.S. dollar index slightly down. Nymex crude oil prices are near steady and trading around $82.50 a barrel. Just last week Nymex crude prices poked just above $95.00 a barrel. Meantime, the benchmark U.S. Treasury 10-year note yield is presently fetching 4.738%.

Other U.S. economic data due for release Friday includes the consumer credit report.

U.S. STOCK INDEXES

December S&P 500 e-mini futures: Prices are firmer in early U.S. trading. Prices are in a nine-week-old downtrend on the daily bar chart. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at Tuesday’s high of 4,335.75 and then at this week’s high of 4,355.50. Support for active traders is seen at this week’s low of 4,235.50 and then at 4,200.00. Wyckoff’s Intra-day Market Rating: 5.5

December Nasdaq index futures: Prices are slightly higher in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is even with the 9-day. Both are below the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at last week’s high of 15,060.75 and then at 15,150.00. On the downside, shorter-term support is seen at Thursday’s low of 14,716.25 and then at the September low of 14,586.00. Wyckoff’s Intra-Day Market Rating: 5.5.

U.S. TREASURY BONDS AND NOTES FUTURES

December U.S. T-Bonds: Prices are lower in early U.S. trading and not far above this week’s contract low. 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 neutral to bearish early today. Shorter-term technical resistance is seen at Tuesday’s high of 112 24/32 and then at this week’s high of 113 24/32. Shorter-term support lies at the contract low of 109 20/32 and then at 109 even. 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 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. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at Tuesday’s high of 107.14.0 and then at this week’s high of 107.29.5. Shorter-term technical support is seen at 106.18.00 and then at the contract low of 106.03.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0

EURO CURRENCY

The December Euro currency futures are near steady in early U.S. trading. Prices are trending lower and bears are in solid near-term technical control. 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 1.0652 and then at 1.0700. Shorter-term support is seen at this week’s low of 1.0482 and then at 1.0450. Wyckoff’s Intra Day Market Rating: 5.0

NYMEX CRUDE OIL

November Nymex crude oil prices are slightly up and hit a five-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 neutral to bearish early today. Look for buy stops to reside just above technical resistance at $85.00 and then at $86.00. Look for sell stops just below technical support at $81.00 and then at $80.00. Wyckoff’s Intra-Day Market Rating: 5.0

GRAINS

Grain futures prices were mixed in overnight trading. Not much new today. Risk aversion in the general marketplace recently is keeping the grain market bulls timid. Harvesting of soybeans and corn is in full swing and that is also a bearish seasonal factor amid commercial hedge selling. Technicals are fully bearish for corn, wheat and meal, and moderately bearish for soybeans.

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 4–Jim Wyckoff’s morning markets report

Asian and European stocks were mixed overnight. U.S. stock indexes are pointed to narrowly mixed openings when the New York day session begins. Risk appetite is not keen at mid-week, following the ouster of the U.S. Speaker of the House of Representatives Tuesday afternoon. The AP said “it was a stunning moment for Speaker Kevin McCarthy, a punishment fueled by growing grievances but sparked by his decision to work with Democrats to keep the federal government open rather than risk a shutdown. Removing the speaker launches House Republicans into chaos heading into a busy fall when Congress will need to fund the U.S. government again or risk a mid-November shutdown.”

And then there’s the U.S. Treasury sell off that has the marketplace spooked. A Barron’s headline today reads: “The bond and stock sell off has momentum. Here’s how it could end.” The story goes on to say “markets have decided to pay attention to the prospect of the Federal Reserve keeping interest rates higher for longer. And now that’s all they can see.” The story said the ways the bond market rout can end would be if the Fed stops or reduces its bond selling. Or, “something breaks.” The article added weakening U.S. economic data may be needed to help turn the tide of the higher rates narrative. “Friday’s September jobs report could be the place for that to begin.”

Indeed, traders are starting to look ahead to Friday’s September employment situation report from the Labor Department. The key non-farm payrolls number is expected to come in at up 170,000 compared to a rise of 187,000 in the September report.

The key outside markets today see the U.S. dollar index weaker on a corrective pullback after hitting a 10-month high Tuesday. Nymex crude oil prices are lower and trading around $88.00 a barrel. There is an OPEC meeting today. Meantime, the benchmark U.S. Treasury 10-year note yield is presently fetching 4.817% and has hit a 16-year high.

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the ADP national employment report, the U.S. services PMI, the global services PMI, the ISM report on business services, manufacturers’ shipments and inventories and the weekly DOE liquid energy stocks report.

U.S. STOCK INDEXES

December S&P 500 e-mini futures: Prices are near steady in early U.S. trading after hitting a four-month low overnight. Prices are in a two-month-old downtrend on the daily bar chart. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at 4,300.00 and then at Tuesday’s high of 4,335.75. Support for active traders is seen at the overnight low of 4,235.50 and then at 4,200.00. Wyckoff’s Intra-day Market Rating: 4.5

December Nasdaq index futures: Prices are slightly lower in early U.S. trading. 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 below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at 14,850.00 and then at last week’s high of 15,060.75. On the downside, shorter-term support is seen at the September low of 14,586.00 and then at 14,500.00. Wyckoff’s Intra-Day Market Rating: 4.5.

U.S. TREASURY BONDS AND NOTES FUTURES

December U.S. T-Bonds: Prices are lower in early U.S. trading and hit another contract low. 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 neutral to bearish early today. Shorter-term technical resistance is seen at Tuesday’s high of 112 24/32 and then at this week’s high of 113 24/32. Shorter-term support lies at the overnight contract low of 109 20/32 and then at 109 even. Wyckoff’s Intra-Day Market Rating: 4.0

December U.S. T-Notes: Prices are lower and hit a contract low 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 and 18-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 Tuesday’s high of 107.14.0 and then at this week’s high of 107.29.5. Shorter-term technical support is seen at the overnight contract low of 106.03.5 and then at 106.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0

EURO CURRENCY

The December Euro currency futures are firmer on short covering after hitting a 10-month low on Tuesday. Prices are trending lower and bears are in solid near-term technical control. 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 1.0600 and then at 1.0652. Shorter-term support is seen at this week’s low of 1.0482 and then at 1.0450. Wyckoff’s Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

November Nymex crude oil prices are lower and hit a more-than-two-week low in early U.S. trading. The shorter-term moving averages are neutral early today as the 4-day is below the 9-day and 18-day. The 9-day is above 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 the overnight high of $89.59 and then at Tuesday’s high of $90.27. Look for sell stops just below technical support at $87.00 and then at $86.00. Wyckoff’s Intra-Day Market Rating: 4.0

GRAINS

Grain futures prices were mixed in overnight trading. Risk aversion in the general marketplace is keeping the grain market bulls very timid. Harvesting of soybeans and corn is in full swing and that is also a bearish seasonal factor amid commercial hedge selling. Technicals are fully bearish for corn, wheat and meal, and moderately bearish for soybeans.

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