Tuesday, April 16–Jim Wyckoff’s morning markets report
Risk aversion is still elevated Tuesday, following the weekend Iranian air attacks on Israel. Israel’s military chief said Israel will retaliate, despite U.S. warnings to Israel that the U.S. won’t participate in any retaliation. NBC reports that an Israeli military response to Iran’s attack is imminent. At present, the general marketplace appears to be taking any Israeli retaliation lightly, as markets are not seeing keen risk aversion or stronger moves into safe-haven assets. This full-time 40-year markets watcher thinks the marketplace is presently dead wrong, regarding thinking the Israel-Iran conflict will not escalate significantly. It seems to me that Israel finally has its good excuse to take out or seriously degrade Iran’s military and its nuclear weapons capability. Iran has vowed in the past to destroy Israel.
In overnight news, China’s first-quarter GDP beat market expectations by rising 5.3%, year-on-year versus 5.2% in the fourth quarter of 20/22 and 4.8% expected by forecasters. On the downside, China’s industrial production in March was up 6.1% versus up 7.0% February and 6.6% forecast. March retail Sales were up 4.7%, year-on-year versus up 5.5% in February and 5.4% expected. And the bad news: China’s property Investment was down 9.5% in March compared to down 9.0% in February and down 9.2% expected by the marketplace. Residential property Sales were down 30.7% in March versus down 32.7% in February, year-on-year.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook retail sales report, new residential construction, and industrial production and capacity utilization. Several Federal Reserve officials are also slated to speak today.
STOCK INDEXES
June S&P 500 e-mini futures: Prices are slightly firmer in early U.S. trading. Bulls still have the overall near-term technical advantage but are fading. A five-month-old uptrend on the daily bar chart has been negated. The shorter-term moving averages (4-day, 9-day 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 5,150.00 and then at 5,200.00. Support for active traders is seen at the overnight low of 5,081.25 and then at 5,050.00. Wyckoff’s Intra-day Market Rating: 5.5
June Nasdaq index futures: Prices are near steady in early U.S. trading. Bulls have the overall near-term technical advantage but are fading. A five-month-old uptrend on the daily bar chart has been negated. Shorter-term moving averages (4- 9-and 18-day) are bearish early today. The 4-day moving average is below the 9-day. The 9-day is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at 18,000.00 and then at 18,150.00. On the downside, shorter-term support is seen at the overnight low of 17,792.00 and then at 17,650.00. Wyckoff’s Intra-Day Market Rating: 5.0.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are lower and hit a five-month low 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 114 24/32 and then at this week’s high of 116 1/32. Shorter-term support lies at 113 even and then at 112 even. Wyckoff’s Intra-Day Market Rating: 4.0
June U.S. T-Notes: Prices are lower 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 bearish early today. Shorter-term resistance lies at the overnight high of 108.04.0 and then at this week’s high of 108.22.0. Shorter-term technical support is seen at this week’s low of 107.18.5 and then at 107.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The June Euro currency futures are slightly firmer on short covering after hitting a 5.5-month low Monday. Bears have the firm 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 and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at 1.0700 and then at 1.0758. Shorter-term support is seen at the overnight low of 1.0629 and then at 1.0600. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
May Nymex crude oil prices are slightly weaker in early U.S. trading. The shorter-term moving averages 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 (RSI and slow stochastics) are bearish early today. Look for buy stops to reside just above technical resistance at last week’s high of $87.67 and then at $89.00. Look for sell stops just below technical support at this week’s low of $84.05 and then at $83.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Grain futures prices were mixed overnight. Still not much new in the grains. Charts remain overall bearish for corn, wheat, soybeans, meal and bean oil. However, wheat and corn markets look like they have put in market bottoms. And if they have done so, so likely have soybeans, meal and bean oil.
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