Thursday, November 11–Jim Wyckoff’s Morning Markets Report
Global stock markets were flat to a bit higher in overnight trading. The U.S. stock indexes are pointed to firmer openings when the New York day session begins. The focus of the marketplace is now on the increasing odds of higher and even problematic price inflation worldwide. Two U.S. inflation reports this week ran hot and underscored inflation is tightening its grip on world economies. The U.S. consumer price index report released Wednesday showed inflation running at a 30-plus year high. Gold prices hit a five-month high and silver scored a three-month high on Wednesday, as traders and investors seek out inflation hedges in hard assets. There are now growing notions the Federal Reserve will be forced to raise U.S. interest rates much sooner that the central bank has recently suggested.
Today is a U.S. federal holiday, Veterans Day, and the U.S. government and Treasury markets are closed. There is no U.S. economic data due for release Thursday, due to the holiday.
In overnight news, the Euro zone forecast its economic growth in 2021 at 5.0%, at up 4.3% in 2022 and at 2.4% growth in 2023. The Euro zone forecast its inflation in 2021 at up 2.4%, up 2.2% in 2022 and up 1.4% in 2023. Those inflation forecasts seem low when compared to inflation numbers that have been released recently.
The key outside markets today see the U.S. dollar index higher and hitting a 15-month high overnight. Nymex crude oil prices are lower and trading around $80.50 a barrel. Meantime, the 10-year U.S. Treasury note yield is presently fetching 1.57%.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are firmer in early U.S. trading but not far below last week’s record high. Bulls have the solid overall near-term technical advantage as prices are trending up. 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 early today. Today, shorter-term technical resistance comes in at Wednesday’s high of 4,680.25 and then at the contract and record high of 4,711.25. Buy stops likely reside just above those levels. Downside support for active traders is seen at this week’s low of 4,625.25 and then at 4,600.00. Sell stops likely reside below those levels. Wyckoff’s Intra-day Market Rating: 6.0
December Nasdaq index futures: Prices are higher in early U.S. trading. Prices last week hit a record high. 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at Wednesday’s high of 16,243.00 and the at the contract and record high of 16,448.50. Buy stops likely reside just above those levels. On the downside, shorter-term support is seen at this week’s low of 15,896.50 and then at and then at 15,750.00. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are a bit lower in early U.S. trading. 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 163 even and then at this week’s high of 164 1/32. Buy stops likely reside just above those levels. Shorter-term support lies at this week’s low of 161 9/32 and then at 161 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
December U.S. T-Notes: Prices are slightly lower in early U.S. trading. 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 bearish early today. Shorter-term resistance is seen at 131.00.0 and then at 131.08.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 130.15.0 and then at 130.08.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
EURO CURRENCY
The December Euro currency futures are lower and hit a 16-month low in early U.S. trading. Bears have the solid overall near-term technical advantage. The shorter-term moving averages for the Euro 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 Euro are bearish early today. The Euro currency finds shorter-term technical resistance at 1.1500 and then at 1.1550. Buy stops likely reside just above those levels. Shorter-term support is seen at the overnight low of 1.1460 and then at 1.1400. Sell stops likely reside just below those levels. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
Nymex crude oil prices are lower in early U.S. trading. Bulls have the firm near-term technical advantage but there are stiff overhead resistance levels just above the market that have turned back rallies. The shorter-term moving averages are neutral early today as the 4-day is even with 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 the overnight high of $82.16 and then at $83.00. Look for sell stops just below technical support at the overnight low of $80.20 and then at $80.00. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
U.S. grain futures were mixed to weaker overnight. Key for soybeans in the near term is the soybean meal futures market. Meal is now trending higher, which begins to signal a market bottom is close at hand for soybeans. Corn and wheat bulls have the near-term technical advantage. Corn is presently following the lead of the stronger wheat market.
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