Thursday, March 14–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
Asian stock were lower overnight and and European stock markets were mostly higher. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins.
British lawmakers voted late Wednesday on another Brexit plan that said the U.K. would not do a “hard Brexit” on March 29, the date for which the U.K. is set to leave the European Union. Now, the Parliament is expected to vote Thursday on a plan to delay Brexit. However, any extension of the Brexit date must get EU approval. The marketplace is reading this as positive that a “soft Brexit” will occur down the road. While somewhat impacting the European markets, the current Brexit uncertainty is not a major element moving world stock and financial markets.
In other overnight news, China’s industrial output fell to a 17-year low in February, at up just 0.43% from January. Year-on-year, the number was up 5.3%. This report could be weighing on the gold futures market today, which is scoring double-digit losses. China’s economy is the major metals consumer worldwide.
In the back-and-forth rhetoric on the U.S.-China trade war front, President Trump said Wednesday he is in “no rush” to ink a trade deal with China, and reiterated the deal must meet U.S. demands. The past few days had seen the marketplace more optimistic regarding a trade agreement between the world’s two largest economies getting completed soon.
The outside markets today see the U.S. dollar index higher. Nymex crude oil prices are slightly up and trading around $58.32 a barrel.
U.S. economic reports due for release Thursday includes the weekly jobless claims report, import and export prices, and new residential sales.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are slightly down in early U.S. trading. Bulls have regained upside momentum this week as the index hit a four-month high Wednesday. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at the Wednesday’s high of 2,826.50 and then at 2,831.75. Buy stops likely reside just above those levels. Downside support for active traders today is located at Wednesday’s low of 2.788.25 and then at 2,750.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.0
June Nasdaq index futures: Prices are slightly down in early U.S. trading. Bulls have upside technical momentum as prices hit a five-month high Wednesday. 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 early today. Shorter-term technical resistance is seen at Wednesday’s high of 7,324.25 and then at 7,350.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at Wednesday’s low of 7,211.00 and then at 7,150.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are lower in early U.S. trading today. Bulls still have the firm overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is even with 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 146 1/32 and then at this week’s high of 146 17/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 145 21/32 and then at this week’s low of 145 3/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
June U.S. T-Notes: Prices are lower 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 and 18-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 the overnight high of 122.24.5 and then at this week’s high of 122.31.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 122.19.0 and then at this week’s low of 122.12.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
U.S. DOLLAR INDEX
The June U.S. dollar index is firmer in early U.S. trading. Bulls have the firm overall near-term technical advantage. The shorter-term moving averages for the dollar index are neutral early today, as the 4-day is below the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at Wednesday’s high of 96.460 and then at 96.725. Shorter-term support is at 96.000 and then at this week’s low of 95.810. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
April Nymex crude oil prices are slightly lower in early U.S. trading but did hit a four-month high overnight. The shorter-term moving averages are bullish early today as the 4-day is above the 9-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 the overnight high of $58.67 and then at $59.00. Look for sell stops just below technical support at $57.50 and then at $57.00. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Grain futures were mixed overnight. Comments from President Trump Wednesday on the U.S.-China trade front were deemed downbeat, which is pressuring the grains a bit today. Traders are awaiting today’s weekly USDA export sales report. Grain market bears have the overall near-term technical advantage amid overall worldwide slack demand for U.S. ag products.
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