Thursday, April 21–Jim Wyckoff’s Morning Markets Report
Global stocks markets were mostly higher overnight. The U.S. stock indexes are pointed toward higher openings when the New York day session begins. The U.S. stock index bulls are having the better week, so far, as near-term price downtrends in the indexes have stalled out. However, risk appetite among traders and investors is by no means robust due to major geopolitical concerns.
The World Bank and IMF meetings continue in Washington, D.C. today. Major central bank chiefs, including Fed Chair Powell, are scheduled to speak on and IMF panel today. The central bankers are expected to sound hawkish tones on their monetary policies. The Fed is leaning heavily hawkish, with a string of 50-basis-point interest rate increases likely in the coming months. Meantime,
traders are betting the European Central Bank will raise rates above zero this year for the first time since 2012, after a string of hawkish comments from ECB policy makers. Money markets are pricing 75 basis points of interest-rate hikes by the ECB’s December meeting.
In overnight news, Euro zone inflation in March hit a record high of 7.4%, year-on-year.
Nymex crude oil futures prices are firmer today and trading around $103.00 a barrel. The U.S. dollar index is lower again early today on a corrective pullback after hitting a two-year high Tuesday. The yield on the 10-year U.S. Treasury note is presently fetching 2.869%.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the Philadelphia Fed business survey and leading economic indicators.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are higher in early U.S. trading. Prices are no longer trending down on the daily bar chart. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is above 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 4,550.00 and then at 4,600.00. Support for active traders is seen at 4,450.00 and then at 4,400.00. Wyckoff’s Intra-day Market Rating: 6.0
June Nasdaq index futures: Prices are higher in early U.S. trading and are no longer trending lower on the daily chart. 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 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 14,298.00 and then at 14,500.00. On the downside, shorter-term support is seen at 14,000.00 and then at this week’s low of 13,729.50. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are lower in early U.S. trading. Bears are in strong technical command. 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 neutral early today. Shorter-term technical resistance is seen at this week’s high of 141 13/32 and then at 142 even. Shorter-term support lies at 139 even and then at the contract low of 138 14/32. Wyckoff’s Intra-Day Market Rating: 4.0
June U.S. T-Notes: Prices are lower in early U.S. trading. Bears are in solid near-term technical control. 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 neutral to bearish early today. Shorter-term resistance lies at this week’s high of 120.00.5 and then at 120.10.0. Shorter-term technical support lies at the contract low of 118.19.5 and then at 118.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The June Euro currency futures are higher in early U.S. trading on more short covering. Bears still have the solid overall near-term technical advantage. The shorter-term moving averages for the Euro are bearish early today, as the 4-day is below the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are bullish early today. The Euro currency finds shorter-term technical resistance at the overnight high of 1.0958 and then at 1.1000. Shorter-term support is seen at the overnight low of 1.0845 and then at 1.0800. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
Nymex crude oil prices are slightly higher 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 early today. Look for buy stops to reside just above technical resistance at $103.00 and then at $104.00. Look for sell stops just below technical support at this week’s low of $99.88 and then at $98.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
U.S. grain futures prices were lower in early U.S. pre-market trading, on corrective pullbacks from recent good gains. Corn and soybean bulls have the solid overall near-term technical advantage. Wheat bulls are fading again. If wheat futures continue to sag then the upside will also be limited in corn and soybeans. Wheat may be the most important grain market to watch in the coming days. On tap today is the weekly USDA export sales 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