Monday, April 29–Jim Wyckoff’s Morning Markets Report
Asian and European stock indexes were narrowly mixed in more subdued trading overnight. U.S. stock indexes are pointed toward mixed openings when the New York day session begins. There continues to be little activity on the geopolitical front to influence world markets, making for a generally calmer and quieter trading environment. The U.S. stock indexes last week hit record or multi-month highs amid upbeat corporate earnings reports being released.
It will likely be a busier trading week this week, as the U.S. economic data pace picks up, including the Federal Open Market Committee (FOMC) meeting that begins Tuesday morning and ends Wednesday afternoon with a statement and a press conference from Fed Chairman Jerome Powell. No change in U.S. monetary policy is expected at this meeting.
U.S. corporate earnings reports will also continue to be released this week.
U.S.-China trade talks also resume this week, with U.S. officials traveling to Beijing. Most of the marketplace is optimistic the U.S. and China will reach a plausible trade deal in the coming weeks.
The key “outside markets” today see the U.S. dollar index trading near steady after hitting a two-year high last Friday. Meantime, Nymex crude oil prices are lower on more profit taking after hitting a six-month high last week, and are now trading around $62.75 a barrel. Oil prices dropped sharply late last week due in part to remarks from President trump saying he told OPEC oil prices were too high.
U.S. economic data due for release Monday includes personal income and outlays, and the Texas manufacturing outlook survey.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are near steady in early U.S. trading today and hit a nearly seven-month high overnight. Bulls have the solid near-term technical advantage amid a price uptrend on the daily chart and no early clues that a market top is close at hand. The 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 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 the September high of 2,961.25 and then at 2,975.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at 2,925.00 and then at 2,915.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5
June Nasdaq index futures: Prices are slightly lower in early U.S. trading. Prices last week hit a contract high. Bulls have the solid overall near-term technical advantage amid a price uptrend on the daily bar chart. 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 last week’s contract high of 7,879.50 and then at 7,900.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 7,800.00 and then at Friday’s low of 7,778.25. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are slightly lower in early U.S. trading. A downtrend on the daily bar chart has been negated. Shorter-term moving averages (4- 9- 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 moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at last week’s high of 147 26/32 and then at 148 even. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 147 10/32 and then at 147 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
June U.S. T-Notes: Prices are near steady in early U.S. trading. A price downtrend on the daily bar chart has been negated. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day and 19-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at last week’s high of 123.24.0 and then at 123.29.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at 123.16.0 and then at Friday’s low of 123.09.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
U.S. DOLLAR INDEX
The June U.S. dollar index is slightly higher early today. Prices Friday hit a two-year high. Bulls have the solid overall near-term technical advantage. The shorter-term moving averages for the dollar index are bullish early today, as the 4-day is above the 9-day and 18-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 last week’s high of 98.085 and then at 98.250. Shorter-term support is seen at Friday’s low of 97.560 and then at 97.290. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
June Nymex crude oil prices are lower in early U.S. trading, on more profit taking from recent gains, and following sharp losses late last week. Bulls still have the overall near-term technical advantage but have faded and a gentle uptrend in place on the daily bar chart is now in jeopardy. 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 $64.00 and then at $65.00. Look for sell stops just below technical support at last week’s low of $62.28 and then at $62.00. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
Grain futures were mixed again overnight. Traders will closely examine todays’ weekly USDA grain export inspections reports. Grain market bears still have the overall near-term technical advantage. Focus is still on U.S. Corn Belt weather, which now favors the bulls as some wet weekend weather and rains in the extended forecasts are prompting some planting-delay concerns.
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