Friday, November 13–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed to lower overnight, while U.S. stock indexes are pointed toward higher openings when the New York day session begins. The marketplace has seen risk appetite dented late this week as the Covid-19 pandemic is raging in the U.S. and Europe. Families are facing the grim reality of spending the upcoming holidays apart.
A survey by Central Banking and Invesco says the Covid-19 pandemic has led to 23% of world central banks seeing gold as a more attractive asset, while the remaining 77% responded their view on gold had not changed. Central bankers generally expect their gold holdings to increase over the next year. General public investor demand for gold has been robust this year as the investing public still sees bullion as a safe-haven asset, the report said.
U.S. Treasury bond and note yields have backed off a bit Friday after rising to eight-month highs earlier this week. The yield on the benchmark 10-year U.S. Treasury note futures is currently trading at 0.88% after pushing closer to 1.0% this week.
The U.S. dollar index is weaker early today. The other important outside market sees crude oil prices lower and trading around $40.50 a barrel.
U.S. economic data due for release Friday includes the producer price index, and the University of Michigan consumer sentiment survey.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are up in early U.S. trading. Bulls have the firm overall near-term technical advantage, but Monday’s low-range close after spiking higher has created a bearish buying “exhaustion tail” on the daily bar chart, suggesting a near-term top is in place. 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 3,576.75 and then at 3,600.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at the overnight low of 3,518.00 and then at this week’s low of 3,506.50. Wyckoff’s Intra-day Market Rating: 6.0
December Nasdaq index futures: Prices are higher in early U.S. trading. Bulls have the firm overall near-term technical advantage, but Monday’s low-range close after spiking higher created a bearish buying “exhaustion tail” on the daily bar chart. There is also the specter of a bearish double-top reversal on the daily chart. 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 12,000.00 and then at 12,119.50. On the downside, shorter-term support is seen at the overnight low of 11,804.75 and then at 11,650.00. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are slightly firmer in early U.S. trading, on short covering after hitting a contract low Wednesday. Bears have the solid near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the overnight high of 172 27/32 and then at 173 even. Shorter-term support lies at the overnight low of 172 even and then at 171 16/32. Wyckoff’s Intra-Day Market Rating: 5.5
December U.S. T-Notes: Prices are slightly firmer on short covering after hitting a five-month low on Wednesday. Bears have the firm near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at the overnight high of 138.10.5 and then at 138.16.0. Shorter-term technical support lies at 138.00.0 and then at 137.24.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The December Euro currency futures are slightly higher in early U.S. trading. The shorter-term moving averages for the Euro 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 for the Euro are neutral to bullish early today. The Euro currency finds shorter-term technical resistance at 1.1853 and then at 1.1894. Shorter-term support is seen at this week’s low of 1.1753 and then at 1.1720. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
December Nymex crude oil prices are lower in early U.S. trading. Bulls have the near-term technical advantage. 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 neutral to bearish early today. Look for buy stops to reside just above technical resistance at the overnight high of $40.94 and then at $42.00. Look for sell stops just below technical support at the overnight low of $40.16 and then at $40.00. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
US grain futures are mixed to weaker in early U.S. pre-market trading, on profit taking from recent strong gains. Corn and soybean futures this week hit new contract highs following a bullish USDA report this week and continued strong export demand for U.S. grains. The grain market bulls have the solid overall near-term technical advantage amid price uptrends in place in all three markets. Traders will closely examine this morning’s weekly USDA export sales report.
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