Monday, June 24–Jim Wyckoff’s Morning Markets Report
Asian and European stock markets were mixed to weaker overnight. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins. This is likely to be a more important trading week, amid big events upcoming.
The U.S.-Iran confrontation in the Persian Gulf region continues to simmer on the front burner of the marketplace. News over the weekend surfaced that the U.S. last week employed a cyber-attack on Iran, specifically its ability to track big ships at sea, and to launch missiles. Also, President Trump says there will be “major” new sanctions put in Iran this week.
U.S. President Trump and Chinese President Xi are scheduled to meet in Japan at the G20 meetings late this week and discuss their ongoing trade war. The outcome of that meeting could have huge implications for markets, especially if an agreement is reached to end the trade war.
The key “outside markets” today see Nymex crude oil prices higher and trading just below $58.00 a barrel. Meantime, the U.S. dollar index is weaker and hit a three-month low overnight.
U.S. economic data due for release Monday includes the Chicago Fed national activity index and the Texas manufacturing outlook survey.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are slightly up and very close to this year’s high scored on Friday. Bulls have the solid overall near-term technical advantage to suggest still more upside. 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 to bullish early today. Today, shorter-term technical resistance comes in at the contract high of 2,969.25 and then at 2,985.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at 2,930.00 and then at 2,915.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5
September Nasdaq index futures: Prices are higher in early U.S. trading and not far below this year’s high. Bulls have the solid overall near-term technical advantage to suggest still more upside. 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at last week’s high of 7,821.00 and then at 7,850.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 7,692.75 and then at 7,650.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are higher in early U.S. trading. Bulls have the solid overall near-term technical advantage to suggest more upside. 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 155 31/32 and then at the contract high of 156 17/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 154 17/32 and then at 154 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
September U.S. T-Notes: Prices are higher in early U.S. trading. 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 support lies at the overnight low of 127.17.0 and then at 127.12.0. Sell stops likely reside just below those levels. Shorter-term technical resistance lies at Friday’s high of 128.00.5 and then at the contract high of 128.08.5. Buy stops likely reside just above those levels. Wyckoff’s Intra-Day Market Rating: 6.0
U.S. DOLLAR INDEX
The September U.S. dollar index is lower and hit a three-month low in early U.S. trading. Bears have good downside momentum. 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 bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 95.715 and then at 96.000. Shorter-term support is seen at 95.500 and then at 95.250. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
August Nymex crude oil prices are higher and hit another three-week high overnight. Bulls have gained good upside momentum recent, to suggest more upside in the near term. 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 bullish early today. Look for buy stops to reside just above technical resistance at the overnight high of $58.22 and then at $59.00. Look for sell stops just below technical support at $57.00 and then at Friday’s low of $56.66. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
U.S. grain futures prices were higher overnight, with corn around 4 cent higher, soybeans up around 6 cents and wheat 2 to 5 cents higher. It’s going to be a very big trading week in the grains, starting with Monday afternoon’s weekly crop progress reports and ending Friday with the updated U.S. acreage and quarterly grain stocks report from the Agriculture Department. Friday’s acreage report will be one of the most important grain market reports of the year, due to the uncertainty surrounding it. Grain traders do not have any consensus on corn and soybean planted acres numbers. U.S. Corn Belt weather still slightly favors the bulls. Rainy and stormy conditions are forecast for the U.S. Midwest much of this week. However, now the corn and soybeans that have not been planted very likely will not be even if conditions do dry out in the Midwest. Also late this week the U.S. and Chinese presidents meet to discuss trade. Ideas are also widely mixed on the outcome of that meeting, whose outcome could have major implications for grain prices.
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