Daily Morning Report

Wednesday, January 4–Jim Wyckoff’s Morning Markets Report

Global stock markets were mostly firmer overnight. U.S. stock indexes are pointed toward modestly higher openings when the New York day session begins. There is some heightened trepidation in the marketplace this first week of the new year. Potentially slowing economic growth in the major industrialized countries along with problematic price inflation in 2023 are keeping traders pensive.

One gauge of anxiety in the marketplace was seen Tuesday, when gold prices posted solid gains despite a strong rally in the U.S. dollar index. In past months the USDX and gold prices have traded in a strong inverse relationship on a daily basis. The rally in the gold market Tuesday was due to safe-haven demand amid wobbly global stocks markets and worries about rising Covid infections in China continuing to crimp the world’s second-largest economy.

The key outside markets today see the U.S. dollar index lower. Nymex crude oil prices are solidly lower and trading around $75.00 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently 3.681%. 

Traders and investors are starting to focus on Friday’s U.S. December employment situation report from the Labor Department. The key non-farm payrolls number is expected to come in at up 200,000, following a rise of 263,000 in the November report.

U.S. economic data due for release Wednesday includes the MBA mortgage applications survey, the Johnson Redbook weekly retail sales report, the ISM report on business manufacturing, domestic auto industry sales and the minutes from the last FOMC meeting.

–Jim

U.S. STOCK INDEXES

March S&P 500 e-mini futures: Prices are firmer in early U.S. trading. 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 below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at this week’s high of 3,906.75 and then at 3,919.75. Support for active traders is seen at the overnight low of 3,839.25 and then at 3,800.00. Wyckoff’s Intra-day Market Rating: 5.5

March Nasdaq index futures: Prices are firmer in early U.S. trading. 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 average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at this week’s high of 11,182.00 and then at 11,411.00. On the downside, shorter-term support is seen at the overnight low of 10,920.25 and then at last week’s low of 10,758.75. Wyckoff’s Intra-Day Market Rating: 5.5.

U.S. TREASURY BONDS AND NOTES FUTURES

March U.S. T-Bonds: Prices are solidly 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 technical resistance is seen at 128 even and then at 129 even. Shorter-term support lies at the overnight low of 126 17/32 and then at 126 even. Wyckoff’s Intra-Day Market Rating: 6.5

March U.S. T-Notes: Prices are solidly higher 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 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 113.20.0 and then at 113.28.0. Shorter-term technical support lies at the overnight low of 112.26.5 and then at 112.20.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.5

EURO CURRENCY

The March Euro currency futures are higher in early U.S. trading. Bulls still have the overall near-term technical advantage. However, a three-month-old uptrend on the daily chart has been negated. The shorter-term moving averages for the Euro 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 for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.0736 and then at last week’s high of 1.0767. Shorter-term support is seen at 1.0600 and then at this week’s low of 1.0570. Wyckoff’s Intra Day Market Rating: 6.0

NYMEX CRUDE OIL

February Nymex crude oil prices are solidly lower in early U.S. trading. Bulls are fading. A fledgling price uptrend on the daily bar chart has been negated. The shorter-term moving averages 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 (RSI and slow stochastics) are bearish early today. Look for buy stops to reside just above technical resistance at the overnight high of $77.42 and then at $80.00. Look for sell stops just below technical support at $74.00 and then at $73.00. Wyckoff’s Intra-Day Market Rating: 3.5

GRAINS

Prices were mixed to weaker overnight. Risk aversion in the marketplace at present has the grain market bulls very timid. Corn bulls have the slight overall near-term technical advantage but are fading this week. Wheat bears have the overall near-term technical advantage. Soybeans bulls still have the chart edge as prices are in an uptrend.   

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, January 3–Jim Wyckoff’s Morning Markets Report

Global stock markets were mixed overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins. The stock indexes begin the new year with some optimism after the S&P 500 stock index in 2022 suffered its worst year since 2008. 

Inflation worries, central bank monetary policies and the Russia-Ukraine war are likely to remain near the front burner of the marketplace in 2023.

The key outside markets today see the U.S. dollar index sharply higher. Nymex crude oil prices are lower and trading around $79.00 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently 3.761%. 

U.S. economic data due for release Tuesday is light and includes construction spending.

–Jim

U.S. STOCK INDEXES

March S&P 500 e-mini futures: Prices are firmer in early U.S. trading. 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 to bullish early today. Today, shorter-term technical resistance comes in at the overnight high of 3,906.75 and then at 3,919.75. Support for active traders is seen at the overnight low of 3,842.75 and then at 3,800.00. Wyckoff’s Intra-day Market Rating: 5.5

March Nasdaq index futures: Prices are slightly up in early U.S. trading. 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 average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at the overnight high of 11,171.00 and then at 11,411.00. On the downside, shorter-term support is seen at the overnight low of 10,952.00 and then at last week’s low of 10,758.75. Wyckoff’s Intra-Day Market Rating: 5.5.

U.S. TREASURY BONDS AND NOTES FUTURES

March U.S. T-Bonds: Prices are solidly 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 neutral to bullish early today. Shorter-term technical resistance is seen at 127 even and then at 128 even. Shorter-term support lies at 126 even and then at the overnight low of 125 3/32. Wyckoff’s Intra-Day Market Rating: 6.5

March U.S. T-Notes: Prices are solidly 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 113.02.0 and then at 113.10.0. Shorter-term technical support lies at the overnight low of 112.12.5 and then at 112.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.5

EURO CURRENCY

The March Euro currency futures are sharply and hit a three-week low in early U.S. trading. Bulls still have the overall near-term technical advantage. However, a three-month-old uptrend on the daily chart has been negated. The shorter-term moving averages for the Euro 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 for the Euro are bearish early today. The Euro currency finds shorter-term technical resistance at 1.0650 and then at 1.0700. Shorter-term support is seen at the overnight low of 1.0570 and then at 1.0500. Wyckoff’s Intra Day Market Rating: 3.5

NYMEX CRUDE OIL

February Nymex crude oil prices are weaker in early U.S. trading. A fledgling price uptrend on the daily bar chart has stalled out. 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 $80.00 and then at the overnight high of $81.50. Look for sell stops just below technical support at last week’s low of $76.79 and then at $75.00. Wyckoff’s Intra-Day Market Rating: 4.0

GRAINS

Corn bulls start 2023 with the overall near-term technical advantage as prices are trending higher. Wheat bears have the overall near-term technical advantage, but bulls are working on fledgling price uptrends that suggest near-term market bottoms are in place. Soybeans bulls still have the chart edge as prices are in an uptrend. 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

Thursday, December 29–Jim Wyckoff’s Morning Markets Report

Global stock markets were flat to weaker overnight. U.S. stock indexes are pointed toward firmer openings when the New York day session begins. The marketplace is quieter this week following the Christmas holiday and just ahead of the new year. 

The World Gold Council reports central bank gold buying at the highest rate since 1967, with Russia and China likely the leaders. “Sanctions on Russia and strained relations between the West and China have led to both countries adopting a policy of ‘de-dollarization’ to rely less on the policies of the U.S. central bank and government,” said broker SP Angel in a morning email dispatch. According to the World Gold Council, central banks bought 399 metric tons of gold in the third quarter, compared to 186 metric tons in the first quarter and 88 metric tons in the first quarter of 2022. Officially, Turkey led buying with 29 metric tons in the third quarter, though many central banks including China and Russia do not always report gold holdings. 

The key outside markets today see the U.S. dollar index weaker. Nymex crude oil prices are lower and trading around $77.75 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently 3.875%. 

U.S. economic data due for release Thursday includes the weekly jobless claims report and the weekly DOE liquid energy stocks report.

–Jim

U.S. STOCK INDEXES

March S&P 500 e-mini futures: Prices are a bit firmer in early U.S. trading, on short covering after hitting a six-week low late last week. The shorter-term moving averages (4-, 9- and 18-day) are still 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 this week’s high of 3,900.50 and then at last week’s high of 3,919.75. Support for active traders is seen at 3,800.00 and then at the December low of 3,788.50. Wyckoff’s Intra-day Market Rating: 5.5

March Nasdaq index futures: Prices are slightly up in early U.S. trading, on short covering after hitting a seven-week low Wednesday. 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 average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 11,000.00 and then at this week’s high of 11,183.75. On the downside, shorter-term support is seen at this week’s low of 10,758.75 and then at the October low of 10,595.25. Wyckoff’s Intra-Day Market Rating: 5.5.

U.S. TREASURY BONDS AND NOTES FUTURES

March U.S. T-Bonds: Prices are near steady 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 technical resistance is seen at Wednesday’s high of 125 31/32 and then at 127 even. Shorter-term support lies at this week’s low of 124 22/32 and then at 124 even. Wyckoff’s Intra-Day Market Rating: 5.0

March U.S. T-Notes: Prices are near steady 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 Wednesday’s high of 112.22.0 and then at 113.00.0. Shorter-term technical support lies at 112.00.0 and then at 111.24.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0

EURO CURRENCY

The March Euro currency futures are slightly up in early U.S. trading. Bulls have the firm overall near-term technical advantage. Prices are in a three-month-old uptrend on the daily chart. The shorter-term moving averages for the Euro 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 for the Euro are neutral to bearish early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.0733 and then at the December high of 1.0807. Shorter-term support is seen at last week’s low of 1.0634 and then at 1.0600. Wyckoff’s Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

February Nymex crude oil prices are weaker in early U.S. trading. A fledgling price uptrend on the daily bar chart has stalled out. 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 $80.00 and then at this week’s high of $81.18. Look for sell stops just below technical support at the overnight low of $76.79 and then at $75.00. Wyckoff’s Intra-Day Market Rating: 4.0

GRAINS

Prices were lower overnight. Not much new this week. Corn bulls have the overall near-term technical advantage as prices are now trending higher. Wheat bears have the overall near-term technical advantage, but bulls are working on fledgling price uptrends that suggest near-term market bottoms are in place. Soybeans bulls still have the chart edge as prices are in an uptrend. 

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