Monday, April 13–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed to weaker in overnight trading. U.S. stock indexes are pointed toward lower openings when the New York day session begins. The U.S. stock indexes have seen near-term price uptrends develop, which suggest at least near-term lows are in place. While the Covid-19 pandemic continues to kill thousands worldwide, the rate of the spread of the illness is slowing in the U.S. and Europe. The major debate among North Americans and Europeans is, if the curve of infections continues to flatten when will governments begin to start up their heavily damaged economies. May 1 has been mentioned frequently as a “rolling start” date for the U.S. economy. Still, at present that timeframe seems to be a best-case scenario.
Reports said the U.S. Treasury on Saturday began distributing stimulus funds to American taxpayers.
Over the weekend, the OPEC oil cartel, Russia, the U.S. and other oil-producing nations agreed to a collective oil production cut of around 13%, which amounts to 9.7 million barrels per day. The oil futures markets had pretty much already factored into their prices the cut and were only modestly up Monday. Nymex crude oil prices were trading around $23.00 a barrel.
Other important markets see the U.S. dollar index weaker this morning. The 10-year U.S. Treasury note yield is trading around 0.73% Thursday morning.
There are no major U.S. economic reports out Monday.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are lower in early U.S. trading but did hit a four-week high overnight. Prices are in a near-term uptrend on the daily chart, which suggests a near-term market bottom is in place. 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 the overnight high of 2,819.50 and then at 2,850.00. Buy stops likely reside just above those levels. Downside support for active traders today is seen at the overnight low of 2,717.75 and then at 2,700.00. Wyckoff’s Intra-day Market Rating: 4.0
June Nasdaq index futures: Prices are lower in early U.S. trading after hitting a four-week high overnight. Recent gains suggest a market bottom is in place, including a price uptrend in place on the daily chart. 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 high of 8,327.50 and then at 8,400.00. On the downside, short-term support is seen at the overnight low of 8,073.25 and then at 8,000.00. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are higher 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 neutral early today. Shorter-term technical resistance is seen at 180 even and then at 181 even. Shorter-term support lies at the overnight low of 178 7/32 and then at last week’s low of 177 18/32. Wyckoff’s Intra-Day Market Rating: 6.0
June U.S. T-Notes: Prices are slightly higher 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 neutral early today. Shorter-term resistance lies at the overnight high of 138.11.0 and then at 138.16.0. Shorter-term technical support lies at the overnight low of 138.00.0 and then at last week’s low of 137.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
U.S. DOLLAR INDEX
The June U.S. dollar index is slightly higher in early U.S. trading. Bulls still have the near-term technical advantage but are fading again. The shorter-term moving averages for the dollar index are bearish early today, as the 4-day is below the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at 99.750 and then at 100.000. Shorter-term support is seen at the overnight low of 99.110 and then at 99.000. Wyckoff’s Intra Day Market Rating: 5.0
NYMEX CRUDE OIL
May Nymex crude oil prices are near steady in early U.S. trading. Trading has turned choppy at lower price levels but the bears still have the overall near-term technical advantage. The shorter-term moving averages are neutral early today as the 4-day is below the 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 $24.00 and then at the overnight high of $24.74. Look for sell stops just below technical support at the overnight low of $22.03 and then at $21.00. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
US grain futures are mixed in early US pre-market trading. While U.S. and global stock markets have stabilized, which has been good for the grain market bulls, crippled global economies remain a major bearish element for the grain markets. On tap today is the weekly USDA export inspections report. Technically, wheat bulls have the overall near-term technical advantage, with soybeans in a neutral posture and corn bears still in firm technical control.
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