Greenback makes a comeback

Friday, March 22–Jim Wyckoff’s morning markets report

Asian and European stock indexes were mixed overnight. U.S. stock indexes are pointed toward higher openings and at or near this week’s record highs when the New York day session begins. The U.S. stock indexes are set to end their best week of gains this year.

The marketplace is paying little attention as the U.S. Congress today is working to avert another federal government shutdown.

The key outside markets today see the U.S. dollar index higher. The USDX has seen solid gains since Wednesday’s FOMC meeting conclusion and was helped by some stronger U.S. economic data released Thursday. Nymex crude oil prices are slightly up and trading around $81.25 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently fetching around 4.24%.

There are no major U.S. economic reports due out Friday.

STOCK INDEXES

June S&P 500 e-mini futures: Prices are slightly higher in early U.S. trading and near Thursday’s contract and record high. Bulls have the solid overall near-term technical advantage. Prices are in a 4.5-month-old uptrend on the daily bar chart. The shorter-term moving averages (4-day, 9-day 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 contract high of 5,322.75 and then at 5,350.00. Support for active traders is seen at Wednesday’s low of 5.233.00 and then at 5,200.00. Wyckoff’s Intra-day Market Rating: 6.0

June Nasdaq index futures: Prices are slightly higher and near the contract and record high set Thursday. 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 and 18-day. The 9-day is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at the contract high of 18,709.00 and then at 18,800.00. On the downside, shorter-term support is seen at 18,500.00 and then at 18,400.00. Wyckoff’s Intra-Day Market Rating: 6.0.

U.S. TREASURY BONDS AND NOTES FUTURES

June U.S. T-Bonds: Prices are up in early U.S. trading. 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 bullish early today. Shorter-term technical resistance is seen at 120 even and then at 121 even. Shorter-term support lies at this week’s low of 118 3/32 and then at the February low of 117 11/32. Wyckoff’s Intra-Day Market Rating: 6.0

June U.S. T-Notes: Prices are higher in early U.S. trading. 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 bullish early today. Shorter-term resistance lies at this week’s high of 110.26.5 and then at 111.00.0. Shorter-term technical support is seen at Thursday’s low of 110.08.5 and then at 110.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0

EURO CURRENCY

The June Euro currency futures are lower and hit a four-week low in early U.S. trading. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is below the 9-day and 18-day. The 9-day is even with the 18-day moving average. Short-term oscillators for the Euro are bearish early today. The Euro currency finds shorter-term technical resistance at the overnight high of 1.0905 and then at this week’s high of 1.0981. Shorter-term support is seen at the overnight low of 1.0845 and then at 1.0800. Wyckoff’s Intra Day Market Rating: 4.0

NYMEX CRUDE OIL

May Nymex crude oil prices are slightly firmer in early U.S. trading. The shorter-term moving averages 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 (RSI and slow stochastics) are neutral early today. Look for buy stops to reside just above technical resistance at Thursday’s high of $81.92 and then at this week’s high of $83.12. Look for sell stops just below technical support at $80.00 and then at $79.00. Wyckoff’s Intra-Day Market Rating: 5.0

GRAINS

Grain futures prices were lower overnight. The late-week surge in the U.S. dollar index is bearish for the grains. Charts remain overall bearish for corn, wheat, soybeans, meal and bean oil. However, corn, soybeans, meal and bean oil, and HRW wheat have broken their near-term price downtrends on the daily charts, to begin to suggest market bottoms are in place.   

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