Monday, July 25–Jim Wyckoff’s Morning Markets Report
Note: I am on vacation this week. My friend and fellow analyst Ken Seehusen is producing my morning and afternoon reports. Ken’s format is a bit different than mine, but I think you will enjoy and benefit from his work.
The STOCK INDEXES
The STOCK INDEXES: The September NASDAQ 100 was steady to higher overnight as investors brace for the busiest week of the year for corporate earnings and economic data as it consolidates some of last-Friday’s decline. Overnight trading sets the stage for a steady to higher opening when the day session begins trading. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If September extends the rally off June’s low, June’s high crossing at 12,973.75 is the next upside target. Closes below the 20-day moving average crossing at 11,997.44 would signal that a short-term top has been posted. First resistance is last-Friday’s high crossing at 12,698.50. Second resistance is June’s high crossing at 12,973.75. First support is the 20-day moving average crossing at 11,997.44. Second support is the July 13th low crossing at 11,479.25. Third support is the June 30th low crossing at 11,351.00.
The September S&P 500 was steady to higher overnight and sets the stage for a higher opening when the day session begins trading. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. Closes above last-Friday’s high crossing at 4016.25, which coincides with the March-April downtrend line would open the door for additional gains near-term. Closes below the 20-day crossing at 3874.06 would signal that a short-term top has been posted. First resistance is last-Friday’s high crossing at 4016.25. Second resistance is the 38% retracement level of the January-June decline crossing at 4078.81. First support is the 20-day moving average crossing at 3874.06. Second support is the July 14th low crossing at 3723.75.
INTEREST RATES
INTEREST RATES: September T-bonds were lower overnight as it consolidates some of last-Friday’s rally. The low-range overnight trade sets the stage for a steady to lower opening when the day session begins trading. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near-term. If September extends the rally off June’s low, the 38% retracement level of the 2021-2022 decline crossing at 143-25 is the next upside target. Closes below the 50-day moving average crossing at 138-02 would confirm that a short-term top has been posted. First resistance is last-Friday’s high crossing at 143-00. Second resistance is the 38% retracement level of the 2021-2022 decline crossing at 143-25. First support is the 50-day moving average crossing at 138-02. Second support is the July 11th low crossing at 136-24. Third support is June’s low crossing at 131-01.
September T-notes was lower overnight as it consolidates some of last-Friday’s rally. Overnight trading sets the stage for a lower opening when the day session begins trading. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near-term. If September extends the rally off last-Thursday’s low, the 38% retracement level of the 2021-2022 decline crossing at 120.209 is the next upside target. Closes below last-Thursday’s low crossing at 117.145 would confirm that a short-term top has been posted while opening the door for additional weakness near-term. First resistance is the 38% retracement level of the 2021-2022 decline crossing at 120.209. Second resistance is the 50% retracement level of the 2021-2022 decline crossing at 122.204 is the next downside target. First support is last-Thursday’s low crossing at 117.145. Second support is the June 28th low crossing at 116.110.
ENERGY MARKETS
September crude oil was slightly higher overnight as it consolidates some of the decline off last-Tuesday’s high. Overnight trading sets the stage for a higher opening when the day session begins trading. Stochastics and the RSI are turning neutral signaling that sideways prices are possible near-term. If September renews the decline off June’s high, the 38% retracement level of the 2020-2022 rally crossing at $86.43 is the next downside target. If September renews the rally off the July 14th low, the 50-day moving average crossing at $104.72 is the next upside target. First resistance is the 20-day moving average crossing at $99.27. Second resistance is the 50-day moving average crossing at $104.72. First support is July 14th low crossing at $88.23. Second support is the 38% retracement level of the 2020-2022 rally crossing at $86.43.
CURRENCIES:
The September Euro was higher overnight while extending the trading range of the past four-days. The high-range overnight trade sets the stage for a steady to higher opening when the day session begins trading. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing at $1.02847 would signal that a short-term low has been posted. If September renews the decline off May’s high, the December 2002 low on the monthly continuation chart crossing at $0.98540 is the next downside target. First resistance is the 20-day moving average crossing at $1.02847. Second resistance is the 50-day moving average crossing at $1.05055. First support is the July 14th low crossing at $1.00000. Second support is the December 2002 low on the monthly continuation chart crossing at $0.98540.
GRAINS
December corn was higher overnight due to short covering as it consolidates some of the decline off May’s high. Overnight trading sets the stage for a higher opening when the day sessions begins trading. Stochastics and the RSI are oversold but remain bearish signaling that sideways to lower prices are possible near-term. If December extends the decline off June’s high, January low crossing at $5.42 1/2 is the next downside target. Closes above last-Monday’s high crossing at $6.23 3/4 would signal that a short-term low has been posted while opening the door for additional gains near-term. First resistance is last-Monday’s high crossing at $6.23 3/4. Second resistance is the July 11th high crossing at $6.58 1/2. First support is the 50% retracement level of the 2020-2022 rally crossing at $5.74 3/4. Second support is the January low crossing at $5.42 1/2.
September wheat was higher overnight as it consolidates some of the decline off May’s high. Overnight trading sets the stage for a higher opening when the day session begins trading. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If September extends the decline off May’s high, the 75% retracement level of the January-May high crossing at $7.23 is the next downside target. Closes above the 20-day moving average crossing at $8.34 3/4 would signal that a short-term low has been posted. First resistance is the 20-day moving average crossing at $8.34 3/4. Second resistance is the July 11th high crossing at $9.40 1/4. First support is the last-Friday’s low crossing at $7.54. Second support is the 75% retracement level of the January-May high crossing at $7.23.
November soybeans was higher overnight as it consolidates some of the decline off June’s high. Overnight trading sets the stage for a higher opening when the day session begins trading. Stochastics and the RSI are oversold but remain bearish signaling that sideways to lower prices are possible near-term. If November extends the decline off June’s high, the January 18th crossing at $12.76 is the next downside target. Closes above last-Monday’s high crossing at $13.93 would signal that a short-term low has been posted. First resistance is last-Monday’s high crossing at $13.93. Second resistance is the July 11th high crossing at $14.38 1/2. First support is the 38% retracement level of the 2020-2022 rally crossing at $12.99 1/4. Second support is the January 18th low crossing at $12.76.
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