Wednesday, March 19–Jim Wyckoff’s morning markets report
The marketplace has been subdued so far this week, ahead of the Federal Open Market Committee (FOMC) monetary policy meeting conclusion Wednesday afternoon that sees a statement and press conference from Fed Chairman Jerome Powell. No change in Fed policy is expected, but as always the marketplace will parse the statement and Powell’s presser for clues on the future path and timing of monetary policy. The Bank of England holds its regular monetary policy meeting Thursday.
In overnight news, European Central Bank president Christine Lagarde said if the ECB’s projections remain in line by June, the central bank can start “dialing back” interest rates.
The key outside markets today see the U.S. dollar index higher. The USDX has seen a solid rebound from the March low and the bulls have the technical advantage. Nymex crude oil prices are weaker and trading around $82.75 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently fetching 4.27%.
Other U.S. economic reports due out Wednesday include the weekly MBA mortgage applications survey and the weekly DOE liquid energy stocks report.
STOCK INDEXES
June S&P 500 e-mini futures: Prices are near steady in early U.S. trading and near the recent contract and record high. Bulls have the solid overall near-term technical advantage. Prices are in a 4.5-month-old uptrend on the daily bar chart. The shorter-term moving averages (4-day, 9-day and 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. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at the contract high of 5,257.25 and then at 5,275.00. Support for active traders is seen at this week’s low of 5,181.75 and then at 5,125.00. Wyckoff’s Intra-day Market Rating: 5.0
June Nasdaq index futures: Prices are slightly up in early U.S. trading. Bulls have the solid overall near-term technical advantage. 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 even with the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at this week’s high of 18,381.00 and then at 18,500.00. On the downside, shorter-term support is seen at last week’s low of 18,006.25 and then at 17,900.00. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are slightly up in early U.S. trading. 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 neutral early today. Shorter-term technical resistance is seen at 120 even and then at 121 even. Shorter-term support lies at this week’s low of 118 3/32 and then at the February low of 117 11/32. Wyckoff’s Intra-Day Market Rating: 5.5
June U.S. T-Notes: Prices are higher in early U.S. trading. 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 neutral early today. Shorter-term resistance lies at 110.16.0 and then at 110.24.0. Shorter-term technical support is seen at this week’s low of 109.24.5 and then at 109.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
EURO CURRENCY
The June Euro currency futures are lower in early U.S. trading. 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 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 this week’s high of 1.0946 and then at 1.1000. Shorter-term support is seen at this week’s low of 1.0874 and then at 1.0844. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
April Nymex crude oil prices are lower in early U.S. trading. Prices Tuesday hit a 4.5-month high. 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 to bearish early today. Look for buy stops to reside just above technical resistance at this week’s high of $83.85 and then at $85.00. Look for sell stops just below technical support at $81.00 and then at $80.00. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
Grain futures prices were mixed overnight. Charts remain overall bearish for corn, wheat, soybeans, meal and bean oil. However, corn, soybeans, meal and bean oil, and HRW wheat have broken their near-term price downtrends on the daily charts, to begin to suggest market bottoms are in place.
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