Wednesday, September 1–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly firmer overnight. The U.S. stock indexes are pointed to firmer openings when the New York day session begins, with S&P 500 and Nasdaq futures near this week’s record highs. Risk appetite remains robust late this summer. However, it has not gone un-noticed in the marketplace that the calendar has turned to September, which begins a two-month stretch in which history shows stock and financial markets can become more turbulent. But this week is still the last unofficial week of summer, with Americans looking forward to the three-day Labor day holiday weekend. The “rubber will meet the road” for many traders and investors when they come back to work next Tuesday. There is one potential speed bump this week: Friday’s U.S. employment situation report from the Labor Department. The August non-farm payrolls component of the jobs report is expected to see growth of 720,000 workers compared to a rise of 943,000 non-farm jobs in July.
In overnight news, the Eurozone August manufacturing purchasing managers index (PMI) came in at 61.4 versus 62.8 in July. The August reading was close to market expectations.
The key outside markets today see the U.S. dollar index near steady. Nymex crude oil futures prices are slightly up and trading around $68.65 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently fetching 1.316%.
U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the ADP employment report, the U.S. manufacturing PMI, the ISM report on business manufacturing, construction spending, the global manufacturing PMI, and domestic auto industry sales.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are firmer in early U.S. trading. Bulls have the solid overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above 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 contract high of 4,532.25 and then at 4,550.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at this week’s low of 4,491.50 and then at 4,450.00. Sell stops likely reside below those levels. Wyckoff’s Intra-day Market Rating: 6.0
December Nasdaq index futures: Prices are a bit higher in early U.S. trading. Bulls have the solid chart advantage. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the contract high of 15,664.00 and then at 15,750.00. Buy stops likely reside just above those levels. On the downside, shorter-term support is seen at this week’s low of 15,409.25 and then at 15,300.00. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are slightly lower in early U.S. trading. 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 to bearish early today. Shorter-term technical resistance is seen at this week’s high of 163 27/32 and then at 164 even. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 162 16/32 and then at 162 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
December U.S. T-Notes: Prices are slightly down in early U.S. trading. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at this week’s high of 133.22.0 and then at 134.00.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 133.07.0 and then at 133.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
EURO CURRENCY
The December Euro currency futures are slightly higher in early U.S. trading. Bears still have the overall near-term technical advantage but a downtrend on the daily bar chart has been negated to suggest a near-term market bottom is in place. The shorter-term moving averages for the Euro 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 Euro are bullish early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.1869 and then at 1.1900. Buy stops likely reside just above those levels. Shorter-term support is seen at this week’s low of 1.1808 and then at 1.1761. Sell stops likely reside just below those levels. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
Nymex crude oil prices are slightly up in early U.S. trading. The shorter-term moving averages 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 (RSI and slow stochastics) are neutral to bullish early today. Look for buy stops to reside just above technical resistance at this week’s high of $69.64 and then at $70.00. Look for sell stops just below technical support at this week’s low of $67.67 and then at $67.00. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
U.S. grain futures were mixed to lower overnight. Bulls are fading this week. Hurricane Ida has seriously disrupted shipping of U.S. corn and soybeans to overseas customers, and that’s bearish. Most of U.S. corn and soybean exports go through the Mississippi River and Gulf of Mexico. Rains in the U.S. Midwest recently have also improved the corn and soybean crops and that’s also bearish.
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