Thursday, September 10–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly weaker overnight. U.S. stock indexes are set for modestly lower openings when the New York day session begins. Traders and investors are wondering if the rebound in the U.S. stock market will continue, following solid gains posted in the stock indexes Wednesday. The months of September and October can produce serious turbulence in the stock and financial markets.
The focus for the global marketplace Thursday is the regular monetary policy meeting of the European Central Bank. The ECB is not expected to make any significant changes in policy, but traders are wondering if the central bank will mention the strength of the Euro currency against the U.S. dollar recently. Also, the ECB could revise its outlook on inflation after the Federal Reserve backed off on its stricter inflation constricts last month.
The weekly U.S. jobless claims report is also out Thursday morning and is expected to show a slight drop in new claims, to around 850,000, following last week’s total of 881,000. These numbers are historically still very high.
The important outside markets today see the U.S. dollar index weaker following decent gains posted earlier this week. Nymex crude oil prices lower and trading around $37.50. The yield on the U.S. Treasury 10-year note is trading around 0.7% today.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the producer price index, monthly wholesale trade, and the weekly DOE liquid energy stocks report.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are lower in early U.S. trading. Bulls still have the overall near-term technical advantage but a five-month-old price uptrend on the daily bar chart has been at least temporarily negated. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-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 Wednesday’s high of 3,424.00 and then at this week’s high of 3,447.00. Buy stops likely reside just above those levels. Downside support for active traders today is seen at 3,350.00 and then at 3,325.00. Wyckoff’s Intra-day Market Rating: 4.0
September Nasdaq index futures: Prices are lower in early U.S. trading. Bulls still have the overall technical advantage but a price uptrend on the daily chart has been negated to suggest a market top is in place. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at the overnight high of 11,455.25 and then at 11,585.00. On the downside, shorter-term support is seen at 11,200.00 and then at 11,000.00. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are steady in early U.S. trading. Bulls and bears are on a level overall near-term technical playing field. 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 technical resistance is seen at the overnight high of 177 21/32 and then at 178 even. Shorter-term support lies at this week’s low of 176 28/32 and then at 176 16/32. Wyckoff’s Intra-Day Market Rating: 5.0
September U.S. T-Notes: Prices are near steady in early U.S. trading. Bulls have the overall near-term technical advantage. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term resistance lies at Wednesday’s high of 139.23.0 and then at 139.27.5. Shorter-term technical support lies at this week’s low of 139.06.0 and then at 139.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
EURO CURRENCY
The December Euro currency futures are higher in early U.S. trading. Bulls have the firm overall near-term technical advantage but trading has turned choppy and sideways at higher levels. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is below the 9-day and 18-day. The 9-day is even with the 18-day moving average. Short-term oscillators for the Euro are neutral to bullish early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.1874 and then at 1.1900. Shorter-term support is seen at the overnight low of 1.1825 and then at this week’s low of 1.1777. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
October Nymex crude oil prices are lower in early U.S. trading. The shorter-term moving averages 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 (RSI and slow stochastics) are bearish early today. Look for buy stops to reside just above technical resistance at the overnight high of $38.18 and then at $39.00. Look for sell stops just below technical support at this week’s low of $36.13 and then at $35.50. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
US grain futures are mixed to higher in early U.S. pre-market trading. Bulls have the near-term technical advantage in all three markets. Weather in the U.S. Corn Belt has become a non-market factor as harvest approaches. Demand from China remains strong for soybeans and even some corn. Friday’s USDA monthly supply and demand report is coming into focus. Many believe the report will favor the bears. Trading is likely to be quieter today ahead of that midday 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