Tuesday, December 28–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins. The marketplace is quieter following the Christmas holiday and just ahead of the new year. Many markets are looking for fresh fundamental inputs to drive price direction.
The key outside markets today see the U.S. dollar index slightly lower. Nymex crude oil prices are lower and trading around $78.75 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently 3.832%.
U.S. economic data due for release Wednesday includes the weekly Johnson Redbook and chain store sales indexes, the Richmond Fed business survey and pending home sales.
–Jim
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are slightly higher in early U.S. trading, on tepid short covering after hitting a six-week low late last week. The 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 moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at last week’s high of 3,919.75 and then at 3,950.00. Support for active traders is seen at 3,800.00 and then at last week’s low of 3,788.50. Wyckoff’s Intra-day Market Rating: 5.5
March Nasdaq index futures: Prices are near steady in early U.S. trading. 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 average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at Tuesday’s high of 11,185.00 and then at last week’s high of 11,411.00. On the downside, shorter-term support is seen at last week’s low of 10,870.50 and then at 10,700.00. Wyckoff’s Intra-Day Market Rating: 5.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are firmer on short covering after hitting a four-week low on Tuesday. 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 neutral to bearish early today. Shorter-term technical resistance is seen at Tuesday’s high of 127 15/32 and then at 128 even. Shorter-term support lies at 125 even and then at 124 even. Wyckoff’s Intra-Day Market Rating: 5.5
March U.S. T-Notes: Prices are higher on short covering after hitting a four-week low on Tuesday. 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 neutral to bearish early today. Shorter-term resistance lies at Tuesday’s high of 113.06.5 and then at 113.16.0. Shorter-term technical support lies at 112.00.0 and then at 111.24.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The March Euro currency futures are near steady in early U.S. trading. Bulls have the firm overall near-term technical advantage. Prices are in a three-month-old uptrend on the daily chart. 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 above the 18-day moving average. Short-term oscillators for the Euro are neutral to bearish early today. The Euro currency finds shorter-term technical resistance at Tuesday’s high of 1.0731 and then at the December high of 1.0807. Shorter-term support is seen at last week’s low of 1.0634 and then at 1.0600. Wyckoff’s Intra Day Market Rating: 5.0
NYMEX CRUDE OIL
February Nymex crude oil prices are weaker in early U.S. trading. Bulls are working on a fledgling price uptrend on the daily bar chart. The shorter-term moving averages are 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 (RSI and slow stochastics) are neutral to bearish early today. Look for buy stops to reside just above technical resistance at $80.00 and then at Tuesday’s high of $81.18. Look for sell stops just below technical support at $77.00 and then at $75.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Prices were steady to mixed overnight. Not much new this week. Corn bulls and bears are on a level overall near-term technical playing field. Wheat bears have the overall near-term technical advantage, but bulls are working on fledgling price uptrends that suggest near-term market bottoms are in place. Soybeans bulls still have the chart edge as prices are in an uptrend.
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