Asian stocks were mixed overnight. China’s markets were still closed for a holiday Monday. European stock markets were a down modestly following some more downbeat manufacturing data coming out of Germany. The U.S. stock indexes are pointed toward weaker openings when the New York day session begins.
In focus Monday is the U.S.-China trade talks that restart this week in Washington, D.C. There is no consensus on whether this latest round of discussions will make any progress toward a trade agreement.
The World Gold Council said world central banks in August purchased 62.1 tons of gold and sold 4.8 tons. That’s way up from central banks buying a net total of 12.8 tons in July.
Nymex crude oil prices are up and trading around $53.00 a barrel today. The other key “outside market” sees the U.S. dollar index slightly up in early U.S. trading.
U.S. economic data due for release Monday includes the employment trends index and consumer credit.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are modestly lower in early U.S. trading. There is still very strong overhead resistance at the recent highs, scored in July and September. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at Friday’s high of 2,953.25 and then at 2,975.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at 2,820.00 and then at last Friday’s low of 2,896.75. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5
December Nasdaq index futures: Prices are modestly lower in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are bearish early today. The 4-day moving average is below 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 Friday’s high of 7,773.75 and then at 7,800.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 7,682.50 and then at Friday’s low of 7,624.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are weaker in early U.S. trading, on profit taking after hitting a four-week high overnight. Bulls have the solid overall near-term technical advantage. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at the overnight high of 165 7/32 and then at 165 16/32. Buy stops likely reside just above those levels. Shorter-term support lies at 164 16/32 and then at 164 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
December U.S. T-Notes: Prices are weaker in early U.S. trading after poking to a four-week high overnight. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term support lies at Friday’s low of 131.15.5 and then at 131.10.0. Sell stops likely reside just below those levels. Shorter-term technical resistance lies at the overnight high of 131.31.5 and then at 132.08.0. Buy stops likely reside just above those levels. Wyckoff’s Intra-Day Market Rating: 4.5
U.S. DOLLAR INDEX
The December U.S. dollar index is slightly up in early U.S. trading. Bulls have the solid overall near-term technical advantage. The shorter-term moving averages for the dollar index 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 dollar index are neutral early today. The dollar index finds shorter-term technical resistance at the overnight high of 98.680 and then at 99.000. Shorter-term support is seen at last week’s low of 98.300 and then at 98.000. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
November Nymex crude oil prices are modestly up in early U.S. trading on short covering after prices last Thursday hit a nearly two-month low. The shorter-term moving averages are bearish early today as the 4-day is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral to bullish early today. Look for buy stops to reside just above technical resistance at $54.00 and then at $55.00. Look for sell stops just below technical support at $52.50 and then at $52.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
US grain futures prices were narrowly mixed in overnight trading. Corn was up around 1 cent, soybeans down 1 cent and wheat around 1 cent lower. The major event in the grain markets this week will be the USDA monthly supply and demand report out Thursday morning. There is no clear consensus regarding what the USDA will do regarding the size of the US corn and soybean crops, especially after the agency last week made surprising cuts to US corn and soybean stockpiles. Weather in the US Midwest is bullish to start the trading week, as later this week is expected to find snow falling in the northern Midwest, with a hard freeze in portions of the northern Corn Belt that will halt the growing season in that area. The U.S.-China trade talks restart in Washington, D.C. this week, and will be closely watched. There is no consensus on whether this latest round of discussions will make any progress toward a trade agreement.
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