Monday, November 13–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mostly weaker overnight. U.S. stock indexes are also pointed toward lower openings when the New York day session begins. Stock market traders are worried about progress bogging down on the U.S. tax-reform legislation working its way through Congress. Lower closes in the U.S. stock indexes last Friday produced some technical damage, to begin to suggest near-term market tops are in place. Bearish key reversals down on the daily bar charts were confirmed in the S&P and Nasdaq stock index futures.
In overnight news, the British pound is under selling pressure against world currencies as U.K. Prime Minister Theresa May is losing support among members of Parliament.
Reports said the value of the cryptocurrency bitcoin has plunged by around 25% in just a few days’ time. This development is likely lending some support to the safe-haven gold market.
The key outside markets on Monday find U.S. dollar index higher in early U.S. trading. The greenback bulls have the slight overall near-term technical advantage.
Meantime, Nymex crude oil futures prices are near steady and are trading just below $57.00 a barrel. It is still my bias that Nymex crude won’t be able to sustain prices at or above $60.00 a barrel.
There is no major U.S. economic data due for release Monday.
–Jim
U.S. STOCK INDEXES
S&P 500 December e-mini futures: Prices are weaker in early U.S. trading, on more profit taking after hitting a contract and record high last week. Bulls still have the overall near-term technical advantage. However, lower price action Friday did confirm a bearish “key reversal” down on the daily bar chart, which is an early technical clue that a market top is in place. 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. 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 2,584.50 and then at the contract high of 2,594.50. Buy stops likely reside just above those levels. Downside support for active traders today is located at last week’s low of 2,563.25 and then at 2,550.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5
Nasdaq index December futures: Prices are weaker in early U.S. trading, on more profit taking after hitting a contract and record high last week. Lower price action Friday did confirm a bearish “key reversal” down on the daily bar chart, which is an early technical clue that a market top is in place. But the bulls still have the overall near-term technical advantage. 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 6,323.50 and then at the contract high of 6,351.50. Buy stops likely reside just above those levels. On the downside, short-term support is seen at Friday’s low of 6,281.00 and then at last week’s low of 6,244.75. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES
December U.S. T-Bonds: Prices are higher in early U.S. trading, on a short-covering bounce after recent strong selling pressure. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 153 even and then at 153 16/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 152 1/32 and then at 151 16/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
December U.S. T-Notes: Prices are higher in early U.S. trading, on short covering. Bears have the overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at the 125.00.0 and then at 125.05.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 124.20.0 and then at 124.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
U.S. DOLLAR INDEX
The December U.S. dollar index is firmerr in early U.S. trading. The shorter-term moving averages for the dollar index are neutral as the 4-day is below the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at Friday’s high of 94.555 and then at 94.865. Shorter-term support is seen at last week’s low of 94.155 and then at 94.000. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
December Nymex crude oil prices are near steady in early U.S. trading. Bulls still have the firm overall near-term technical advantage amid a near-term price uptrend being in place. Look for buy stops to reside just above technical resistance at last week’s high of 57.92 and then at $58.50. Look for sell stops just below technical support at $56.41 and then at $56.00. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Grain futures markets were weaker overnight. Traders are still digesting last week’s bearish monthly USDA supply and demand report, showing a record U.S. average corn yield. Bears were given a fresh shot of power, to suggest a bit more downside price pressure in the near term.