Monday, December 4–Jim Wyckoff’s morning markets report
Asian and European stock markets were mixed to firmer in overnight trading. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins.
Risk aversion is keener to start the trading week as tensions in the Middle East are on the rise. Missiles fired by Yemen’s Houthi rebels struck three commercial ships Sunday in the Red Sea, while a U.S. warship shot down three drones in self-defense, the U.S. military said. The Iranian-backed Houthis claimed two of the attacks. Meantime, Israel has resumed its military offensive in the Gaza strip.
The price of safe-haven gold hit a record high overnight, with February Comex futures hitting an intra-day new high of $2,152.30 an ounce. Prices have backed down from their daily highs just ahead of the New York day session.
Bitcoin prices overnight pushed above $41,000 and to a 20-month high, on ideas U.S. regulators are taking a more favorable view of the crypto currency.
The key outside markets today see the U.S. dollar index a bit firmer. Nymex crude oil prices are slightly down and trading around $73.50 a barrel. The yield on the benchmark U.S. Treasury 10-year note is presently fetching 4.245%.
U.S. economic data due for release Monday is light and includes manufacturers’ shipments and inventories.
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are slightly down in early U.S. trading. 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 last week’s high of 4,657.75 and then at 4,700.00. Support for active traders is seen at last week’s low of 4,594.00 and then at 4,569.25. Wyckoff’s Intra-day Market Rating: 4.5
March Nasdaq index futures: Prices are lower in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at 16,301.00 and then at the contract high of 16,410.25. On the downside, shorter-term support is seen at last week’s low of 16,057.00 and then at 16,000.00. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are weaker in early U.S. trading. Prices hit a nine-week high Friday. 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 bearish early today. Shorter-term technical resistance is seen at last week’s high of 118 17/32 and then at 119 even. Shorter-term support lies at 117 even and then at Friday’s low of 116 13/32. Wyckoff’s Intra-Day Market Rating: 4.5
March U.S. T-Notes: Prices are weaker in early U.S. trading on a corrective pullback after hitting a nine-week high Friday. 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 bearish early today. Shorter-term resistance lies at last week’s high of 110.28.0 and then at 111.00.0. Shorter-term technical support is seen at 110.00.0 and then at 109.22.0. 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 lower in early U.S. trading. Bulls have the slight overall near-term technical advantage but are fading. A price uptrend on the daily bar chart has stalled out. The shorter-term moving averages for the Euro 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 Euro are bearish early today. The Euro currency finds shorter-term technical resistance at Friday’s high of 1.0961 and then at 1.1000. Shorter-term support is seen at last week’s low of 1.0880 and then at 1.0850. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
January Nymex crude oil prices are slightly down in early U.S. trading. The shorter-term moving averages 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 (RSI and slow stochastics) are bearish early today. Look for buy stops to reside just above technical resistance at $75.00 and then at $76.00. Look for sell stops just below technical support at the November low of $72.37 and then at $71.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Grain futures prices were mixed overnight. On tap today is the weekly USDA export inspections and USDA weekly crop progress reports. Technicals remain overall bearish for corn and wheat. Technicals are slightly bullish for soybeans and meal as those markets’ price uptrends have been negated. Seasonal studies are turning friendlier for the grains now that the U.S. harvest of corn and soybeans has ended.
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