Wednesday, December 9–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed but mostly up overnight. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins. The U.S. indexes have this week set more record highs. The marketplace continues to generally look over the horizon into 2021, when most believe the Covid-19 pandemic will be tamped down by successful vaccines taken by hundreds of million people and major global economies will be well on the road to full recoveries. However, the World Health Organization has just said, “The epidemic in the U.S. is punishing. It’s widespread. It’s quite frankly shocking to see one to two persons a minute die in the U.S.” The virus is blamed for more than 286,000 deaths and over 15 million confirmed infections in the U.S. New records on daily deaths, infections and hospitalizations continue to be set in the U.S.
Traders and investors are also more upbeat on the increasing likelihood the U.S. Congress will soon pass a financial aid package for Americans that totals just under $1 trillion.
The U.S. dollar index is weaker early today and not far above last week’s 2.5-year low. The other important outside market sees January Nymex crude oil futures prices a bit higher and trading around $45.70 a barrel. The yield on the benchmark 10-year U.S. Treasury note futures is currently trading at 0.91%.
U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, monthly wholesale trade and the weekly DOE liquid energy stocks report.
–Jim
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are slightly up in early U.S. trading and hit another record high overnight. 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 to bullish early today. Today, shorter-term technical resistance comes in at the overnight contract and record high of 3,707.00 and then at 3,725.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at this week’s low of 3,656.50 and then at 3,625.00. Wyckoff’s Intra-day Market Rating: 6.0
March Nasdaq index futures: Prices are slightly lower in early U.S. trading after hitting a record high overnight. Bulls have the solid overall near-term technical advantage. 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 to bearish early today. Shorter-term technical resistance is seen at the overnight record high of 12,667.75 and then at 12,750.00. On the downside, shorter-term support is seen at this week’s low of 12,473.00 and then at 12,400.00. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are lower in early U.S. trading. Bears have the solid 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 neutral to bearish early today. Shorter-term technical resistance is seen at the overnight high of 172 28/32 and then at this week’s high of 173 16/32. Shorter-term support lies at 172 even and then at last week’s low of 171 4/32. Wyckoff’s Intra-Day Market Rating: 4.0
March U.S. T-Notes: Prices are lower in early U.S. trading. Bears have the firm 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 resistance lies at the overnight high of 137.23.5 and then at this week’s high of 137.31.5. Shorter-term technical support lies at 137.16.0 and then at last week’s low of 137.07.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The March Euro currency futures are slightly higher in early U.S. trading. Bulls are in solid technical control. 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 neutral to bearish early today. The Euro currency finds shorter-term technical resistance at last week’s high of 1.2208 and then at 1.2250. Shorter-term support is seen at this week’s low of 1.2111 and then at 1.2072. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
January Nymex crude oil prices are slightly higher in early U.S. trading. Bulls have the solid overall near-term technical advantage amid a price uptrend in place on the daily chart. The shorter-term moving averages are bullish early today as the 4-day is above the 9-day and 18-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 the overnight high of $46.24 and then at last week’s high of $46.68. Look for sell stops just below technical support at $45.00 and then at $44.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
US grain futures are mixed to slightly higher in early U.S. pre-market trading. Grain bulls are wobbly now. The Covid-19 pandemic in the U.S. and other parts of the world and worries about demand, especially from China, are hurting the grains. Traders are awaiting Thursday morning’s latest USDA monthly supply and demand report and trading may be quieter today, ahead of that data.
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