Thursday, November 30–Jim Wyckoff’s morning markets report
In overnight news, Eurozone inflation fell more than expected. The bloc’s November consumer price index came in at up 2.4%, year-on-year, compared to up 2.9% in October and forecasts for up 2.8% in November. A Dow Jones Newswire headline today reads: “Euro zone inflation fell more than expected, putting ECB rate cuts into view.”
Meantime, China got some more dour economic news Thursday as its November official manufacturing purchasing managers index (PMI) slipped to 49.4 from 49.5 in October. That marks the second month in a row of the manufacturing PMI being below 50.0, which suggests contraction in the sector. China’s services PMI dropped to 49.3 in November from 50.1 in October.
The key outside markets today see the U.S. dollar index solidly higher. Nymex crude oil prices are higher and trading around $79.25 a barrel. Reports say OPEC, at its meeting today, will make additional cuts to the cartel’s collective crude oil production. The yield on the benchmark U.S. Treasury 10-year note is presently fetching 4.29%.
U.S. economic data due for release Thursday includes the weekly jobless claims report, personal income and outlays that include more personal consumption expenditures (PCE) inflation numbers, the Chicago ISM business survey, pending home sales and monthly retail chain store sales.
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are slightly firmer after hitting a three-month high Wednesday. The 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 is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Today, shorter-term technical resistance comes in at this week’s high of 4,646.50 and then at 4,700.00. Support for active traders is seen at this week’s low of 4,597.00 and then at last week’s low of 4,569.25. Wyckoff’s Intra-day Market Rating: 6.0
March Nasdaq index futures: Prices are slightly up in early U.S. trading after hitting a contract 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 is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at Wednesday’s contract high of 16,410.25 and then at 16,500.00. On the downside, shorter-term support is seen at this week’s low of 16,142.50 and then at 16,000.00. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are lower after hitting a nine-week high overnight. 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 to bearish early today. Shorter-term technical resistance is seen at the overnight high of 117 24/32 and then at 118 even. Shorter-term support lies at Wednesday’s low of 116 17/32 and then at 116 even. Wyckoff’s Intra-Day Market Rating: 4.0
March U.S. T-Notes: Prices are lower after hitting a nine-week high Wednesday. 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 to bearish early today. Shorter-term resistance lies at this week’s high of 110.15.5 and then at 110.24.0. Shorter-term technical support is seen at Wednesday’s low of 109.29.0 and then at 109.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The March Euro currency futures are lower in early U.S. trading after hitting a 3.5-month high Wednesday. Bulls have the overall near-term technical advantage. Prices are trending higher on the daily bar chart. The shorter-term moving averages for the Euro 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 for the Euro are bearish early today. The Euro currency finds shorter-term technical resistance at the overnight high of 1.1035 and then at this week’s high of 1.1070. Shorter-term support is seen at 1.0941 and then at 1.0900. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
January Nymex crude oil prices are firmer in early U.S. trading. The shorter-term moving averages are neutral early today as the 4-day is even with the 9-day. The 9-day is even with the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bullish early today. Look for buy stops to reside just above technical resistance at $80.00 and then at $81.00. Look for sell stops just below technical support at the overnight low of $77.46 and then at Wednesday’s low of $75.67. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures prices were steady to weaker overnight. On tap today is the weekly USDA export sales report. Technicals remain overall solidly bearish for corn and wheat. Technicals are just slightly bullish for soybeans and meal as those markets’ price uptrends have been negated.
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