Thursday, September 8–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly firmer overnight, following the strong gains in the U.S. stock market on Wednesday. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins. The feature in the marketplace late this week is the big drop in crude oil prices, amid concerns of global economic recession as most major central banks are tightening their monetary policies. The Federal Reserve’s beige book, out Wednesday afternoon, pointed out weaker U.S. economic growth. Fed Chairman Jerome Powell will speak today at a Cato Institute panel discussion. It’s his last scheduled speech before the Sept. 20-21 FOMC meeting. The European Central Bank meets today and most expect the ECB to raise its main interest rate by 75 basis points.
The key outside markets today see Nymex crude oil prices near steady and trading around $82.00 a barrel after hitting an eight-month low overnight. The U.S. dollar index is lower on a corrective pullback after hitting a 20-year high Wednesday. The yield on the 10-year U.S. Treasury note is fetching 3.25%.
U.S. economic data due for release Thursday includes the weekly jobless claims report, consumer credit and the DOE liquid energy stocks report.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are slightly higher in early U.S. trading. Prices are still in a downtrend on the daily bar chart. The shorter-term moving averages (4-, 9- and 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-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 Tuesday’s high of 4,035.75 and then at 4,075.00. Support for active traders is seen at 3,950.00 and then at this week’s low of 3,900.00. Wyckoff’s Intra-day Market Rating: 5.5
December Nasdaq index futures: Prices are slightly higher in early U.S. trading. Prices are still trending down on the daily bar chart. Shorter-term moving averages (4- 9-and 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-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 12,534.25 and then at 12,730.25. On the downside, shorter-term support is seen at 12,200.00 and then at 12,000.00. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are slightly up in early U.S. trading after hitting an 11-week low on Wednesday. Prices are in a five-week-old downtrend on the daily bar chart and bears have the firm advantage. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at the overnight high of 134 8/32 and then at 135 even. Shorter-term support lies at the overnight low of 133 13/32 and the at 133 even. Wyckoff’s Intra-Day Market Rating: 5.5
December U.S. T-Notes: Prices are firmer in early U.S. trading after hitting an 11-week low on Wednesday. Prices are in a five-week-old downtrend on the daily bar chart and bears have the firm technical advantage. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-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 116.16.0 and then at this week’s high of 116.27.5. Shorter-term technical support lies at the overnight low of 116.03.0 and then at 115.24.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The December Euro currency futures are slightly higher in early U.S. trading. Bears 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 1.0100 and then at 1.0150. Shorter-term support is seen at 1.0000 and then at the contract low of .9935. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
October Nymex crude oil prices are firmer in early U.S. trading but hit an eight-month low overnight. The shorter-term moving averages are bearish early today as the 4-day is below the 9-day and 18-day. The 9-day is below 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 $84.00 and then at $85.00. Look for sell stops just below technical support at the overnight low of $81.20 and then at $80.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
U.S. grain futures were mixed to firmer overnight. The corn market is trending up and the bulls have the chart advantage. Soybean prices are chopping sideways and bulls and bears are on a level technical playing field. Soybeans are being supported by a bullish soybean meal market. Wheat markets have seen bullish upside breakouts from the recent sideways trading ranges at lower levels and the bulls have gained upside momentum this week.
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