Wednesday, March 17–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed but mostly lower overnight. U.S. stock indexes are pointed toward mixed openings when the New York day session begins. U.S. Treasury bond yields are on the rise again and that is giving stock markets pause. The U.S. Treasury 10-year Treasury note is presently yielding 1.641%.
Traders at mid-week are squarely focused on the Federal Reserve’s two-day Open Market Committee (FOMC) meeting that began Tuesday morning and ends Wednesday afternoon with a statement and new U.S. economic projections, as well as a press conference from Fed Chairman Jerome Powell. While no change in U.S. monetary policy is expected at this week’s meeting, traders will be closely scrutinizing the Fed’s wording and Powell’s comments regarding U.S. and global economic growth and inflation prospects.
An inflation reading coming out of the Euro Zone today continues to show very tame prices. The February consumer price index came in up 0.2% from January and up 0.9%, year-on-year. Those numbers were in line with market expectations.
The key “outside markets” today see Nymex crude oil futures prices lower and trading around $64.30 a barrel. Meantime, the U.S. dollar index is just a bit lower early today.
Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, new residential construction and the weekly DOE liquid energy stocks report.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are near steady in early U.S. trading and trading just below Tuesday’s contract and record 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 and 18-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 3,970.75 and then at 4,000.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at this week’s low of 3,913.00 and then at 3,900.00. Wyckoff’s Intra-day Market Rating: 5.0
June Nasdaq index futures: Prices are slightly down in early U.S. trading, on a mild corrective pullback from recent solid gains. 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 average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the overnight high of 13,173.75 and then at this week’s high of 13,287.25. On the downside, shorter-term support is seen at 13,000.00 and then at 12,900.00. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are lower in early U.S. trading and near the recent contract low. Bears have the solid overall near-term technical advantage. 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 156 4/32 and then at this week’s high of 156 20/32. Shorter-term support lies at the contract low of 155 12/32 and then at 155 even. Wyckoff’s Intra-Day Market Rating: 4.0
June U.S. T-Notes: Prices are lower in early U.S. trading and near the recent contract low. 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 bearish early today. Shorter-term resistance lies at the overnight high of 131.31.0 and then at this week’s high of 132.05.5. Shorter-term technical support lies at the contract low of 131.23.0 and then at 131.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The June Euro currency futures are slightly firmer in early U.S. trading. Bears have the overall near-term technical advantage. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is even with the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.1990 and then at last week’s high of 1.2014. Shorter-term support is seen at this week’s low of 1.1905 and then at the March low of 1.1861. Wyckoff’s Intra Day Market Rating: 5.0
NYMEX CRUDE OIL
April Nymex crude oil prices are weaker in early U.S. trading on more profit taking. Bulls still have the solid overall near-term technical advantage amid a price uptrend in place on the daily chart. The shorter-term moving averages are neutral early today as the 4-day is even with the 9-day. The 9-day is above 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 $65.00 and then at the overnight high of $65.34. Look for sell stops just below technical support at this week’s low of $63.80 and then at $63.13. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
U.S. grain futures are steady to lower in early U.S. pre-market trading. Not much new. Trading remains choppy as the grain traders await the very important March 31 USDA planting intentions and quarterly grains stocks reports. Grain market bulls still have the firm overall near-term technical advantage as prices are still mostly trending up—both on a near-term and longer-term basis.
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