Monday, March 27–Jim Wyckoff’s morning markets report
Global stock markets were mostly higher overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins. Risk appetite is a bit keener to start the trading week. The U.S. and European banking systems appear to have stabilized, at least for the moment. First Citizens Bancshares has agreed to buy pieces of Silicon Valley Bank. Meantime, Deutsche Bank shares are firmer today amid easing fears for that bank’s health.
Geopolitics is moving closer to the front burner of the marketplace as Russia over the weekend threatened to station tactical nuclear weapons in Belarus. North Korea has test-fired more ballistic missiles and the U.S. has retaliated with air strikes in Syria after an Iranian-backed drone attack killed a U.S. citizen and injured U.S. military personnel.
It’s a busy week for U.S. economic data, including Friday’s much-anticipated personal consumption and expenditures data that will provide fresh clues on whether the U.S. economy is headed toward recession.
The key outside markets today see the U.S. dollar index near steady. Nymex crude oil futures prices are modestly up and trading around $69.75 a barrel. The benchmark 10-year U.S. Treasury note yield is presently fetching 3.458%.
U.S. economic data due for release Monday includes the Texas manufacturing survey.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are firmer in early U.S. trading. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at last week’s high of 4,073.75 and then at 4,100.00. Support for active traders is seen at Friday’s low of 3,937.00 and then at last week’s low of 3,897.25. Wyckoff’s Intra-day Market Rating: 6.0
June Nasdaq index futures: Prices are slightly up in early U.S. trading. 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the March high of 13,082.00 and then at 13,250.00. On the downside, shorter-term support is seen at 12,678.00 and then at last week’s low of 12,525.25. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are 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 technical resistance is seen at the overnight high of 132 19/32 and then at Friday’s high of 133 9/32. Shorter-term support lies at 131 even and then at 130 even. Wyckoff’s Intra-Day Market Rating: 4.0
June U.S. T-Notes: Prices are solidly lower in early U.S. trading. Prices Friday hit a contract high. Shorter-term moving averages (4- 9- 18-day) are still 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. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at 116.00.0 and then at today’s high of 116.06.5. Shorter-term technical support is seen at the overnight low of 115.11.5 and then at 115.00.0. 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 up in early U.S. trading. The shorter-term moving averages for the Euro are still 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 for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at Friday’s high of 1.0891 and then at the March high of 1.0983. Shorter-term support is seen at Friday’s low of 1.0768 and then at last week’s low of 1.0690. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
May Nymex crude oil prices are firmer in early U.S. trading. Bears have the firm overall near-term technical advantage. The shorter-term moving averages are neutral early today as the 4-day is above the 9-day. The 9-day is below 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bullish early today. Look for buy stops to reside just above technical resistance at last week’s high of $71.67 and then at $72.50. Look for sell stops just below technical support at $69.00 and then at $68.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures prices were mostly weaker overnight. On tap today is the weekly USDA export inspections report. Any renewed elevated risk aversion in the general marketplace this week will limit speculative buying interest in grains. Soybean market bears have the overall near-term technical advantage, as soybean meal futures have broken down. Corn and wheat bears have the firm overall near-term chart advantage.
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