Tuesday, July 25–Jim Wyckoff’s morning markets report
Asian and European stock markets were mixed in quieter overnight trading. U.S. stock indexes are pointed toward mixed openings when the New York day session begins.
In overnight news, Chinese officials said they plan to implement stimulus measures to support its ailing property sector. The move was seen as disappointing by China watchers, who wanted more stimulus action in the broader economy.
The U.S. data point of the week is the Federal Reserve’s Open Market Committee (FOMC) meeting that begins Tuesday morning and ends Wednesday afternoon with a statement. Most market watchers believe the Fed will raise the main U.S. rate, the Fed funds rate, by 0.25%. As usual, the marketplace will closely scrutinize the FOMC statement and Fed Chair Powell’s remarks at his press conference for clues on the trajectory of Fed monetary policy in the coming months.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook retail sales report, the monthly house price index, the S&P Case-Shiller home indexes, the Richmond Fed business survey, and the consumer confidence index.
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are slightly firmer in early U.S. trading and not far below last week’s 15-month high. Bulls have the solid overall near-term technical advantage. 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 early today. Today, shorter-term technical resistance comes in at last week’s high of 4,609.25 and then at 4,650.00. Support for active traders is seen at 4,550.00 and then at last week’s low of 4,528.00. Wyckoff’s Intra-day Market Rating: 5.5
September Nasdaq index futures: Prices are slightly higher in early U.S. trading. Bulls still have the solid 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. 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 last Friday’s high of 15,719.25 and then at 15,850.00. On the downside, shorter-term support is seen at Monday’s low of 15,483.75 and then at 15,350.00. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are lower in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at the overnight high of 126 6/32 and then at 127 even. Shorter-term support lies at 125 even and then at 124 even. Wyckoff’s Intra-Day Market Rating: 4.0
September U.S. T-Notes: Prices are lower in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 112.01.5 and then at Monday’s high of 112.17.5. Shorter-term technical support is seen at 111.16.0 and then at 111.08.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The September Euro currency futures are weaker 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. 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 1.1117 and then at Monday’s high of 1.1177. Shorter-term support is seen at the overnight low of 1.1070 and then at 1.1000. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
September Nymex crude oil prices are slightly higher in early U.S. trading. 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 bullish early today. Look for buy stops to reside just above technical resistance at Monday’s high of $79.28 and then at $80.00. Look for sell stops just below technical support at Monday’s low of $76.44 and then at $75.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures prices were lower in overnight trading on profit taking and downside corrections from recent strong gains. Weather in the Midwest is very hot with little to no precipitation this week. Meantime, the Russia-Ukraine war has escalated to included more attacks on Ukraine grain facilities. Technicals are bullish for soybeans for corn and wheat futures. Look for higher volatility in the grain in the near term.
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