Thursday, April 18–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
Asian and European stock indexes were mixed to weaker overnight. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins.
The marketplace, especially the FOREX sector, is keeping a very close eye on the Turkish lira, which has weakened significantly against the U.S. dollar recently. There are concerns about Turkey’s low foreign currency reserves that would have to be used to defend the lira in case speculative FOREX traders mounted a selling attack on it.
The U.S.-China trade negotiations are continuing and apparently the world’s two largest economies are moving closer to a final agreement. There is talk in the marketplace that President Trump and Chinese President Xi Jinping could meet next month to seal the deal.
The key outside markets today find the U.S. dollar index higher, as the Euro currency is pressured by some weak manufacturing data coming out of the Euro zone today. Meantime, Nymex crude oil prices are slightly down and trading around $63.75 a barrel.
It’s a busy day for U.S. economic reports due for release Thursday, including the weekly jobless claims report, the Philadelphia Fed business survey, retail sales, the flash U.S. services and manufacturing purchasing managers indexes, manufacturing and trade inventories, and leading economic indicators.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are near steady in early U.S. trading today. Bulls still have the firm near-term technical advantage amid a price uptrend on the daily chart. 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 above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at this week’s six-month high of 2,923.50 and then at 2,940.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 2,889.50 and then at last week’s low of 2,877.25. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.0
June Nasdaq index futures: Prices are near steady in early U.S. trading. 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 this week’s high of 7,733.50 and then at the October high of 7,767.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at this week’s low of 7,598.75 and then at 7,550.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are higher on short covering after hitting a four-week low on Wednesday. Bulls have faded recently and a downtrend is in place on the daily bar chart. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below with 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 the overnight high of 146 29/32 and then at this week’s high of 147 5/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 146 7/32 and then at this week’s low of 145 31/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
June U.S. T-Notes: Prices are higher on short covering after hitting a four-week low Wednesday. Bulls have faded recently as a price downtrend is in place on the daily bar chart. 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 bullish early today. Shorter-term resistance lies at the overnight high of 123.07.0 and then at 123.16.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 122.27.0 and then at this week’s low of 122.20.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
U.S. DOLLAR INDEX
The June U.S. dollar index is higher early today. Bulls have the solid overall near-term technical advantage. The shorter-term moving averages for the dollar index are neutral early today, as the 4-day is even with the 9-day. The 9-day is even with the 18-day moving average. Short-term oscillators for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at the March high of 97.160 and then at 97.500. Shorter-term support is seen at the overnight low of 96.620 and then at last week’s low of 96.365. Wyckoff’s Intra Day Market Rating: 6.5
NYMEX CRUDE OIL
May Nymex crude oil prices are slightly lower in early U.S. trading today. Bulls have the firm near-term technical advantage and are keeping a gentle uptrend in place on the daily bar chart. The shorter-term moving averages 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 (RSI and slow stochastics) are bearish early today. Look for buy stops to reside just above technical resistance at the April high of $64.79 and then at $65.00. Look for sell stops just below technical support at this week’s low of $62.99 and then at $62.50. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Grain futures were mixed overnight. This morning’s weekly USDA export sales report will be the focus of traders. Grain market bears still have the firm overall near-term technical advantage. Focus is turning to U.S. Corn Belt weather, which has been cold and wet recent weeks, with more precip forecast for next week, which is going to cause field work and possibly corn-planting delays.
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