Global stock markets were mostly firmer in overnight trading. U.S. stock indexes are pointed toward higher openings when the New York day session begins. The general public (not the investing public) is starting to pick up on the solid rebound in the U.S. stock market despite the gloom and doom that continues to envelope the American and global economies. The vast majority of regular traders and investors knows the rallying stock market means the marketplace strongly expects the North American and European economies will be roaring back to life in the coming months. However, for the general public, most of which does not have a portfolio of stocks, the rallying stock markets could give Wall Street another black eye amid the perceptions of the rich getting richer during these extremely troublesome times that have so many out of work. Don’t be surprised if the U.S. presidential election this fall has at least some attention paid to this matter.
Speaking of troubled times, that point will be driven home hard Friday morning with the release of the April U.S. employment situation report from the Labor Department. The non-farm jobs figure is expected to show a loss of 21 million American workers and an unemployment rate north of 15%. These numbers will be the worst ever, since these figures started being recorded in the 1940s. Some economists are calling for U.S. economic data in the coming weeks to reach the Great Depression era figures of the 1930s.
On the positive side of the ledger on this last trading day of the week, U.S. and Chinese trade officials had a conference call overnight, reports said. The call was apparently prompted by President Trump threatening to call off the Phase 1 trade deal reached in January. The reports said the call went well. China has been purchasing more American agricultural products, as reported by USDA this week.
Traders and investors are also more upbeat this week amid a strong recovery in Nymex crude oil futures prices as U.S. and European economies begin to reopen. Nymex futures are higher early today and trading around $24.00 a barrel. Less than two weeks ago June crude futures traded well below $10.00 a barrel. Many raw commodity futures markets have taken note that their sector leader, crude, has made such a strong recovery recently—because it implies other commodity markets may also have hit their lows, or are close to bottoming out.
Other U.S. economic reports out Friday include monthly wholesale trade.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are higher again in early U.S. trading and poised for a bullish weekly high close today. Bulls have the near-term technical advantage amid a near-term uptrend on the daily chart. The 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 is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Today, shorter-term technical resistance comes in at the April high of 2,965.00 and then at 3,000.00. Buy stops likely reside just above those levels. Downside support for active traders today is seen at the overnight low of 2,879.75 and then at 2,850.00. Wyckoff’s Intra-day Market Rating: 6.5
June Nasdaq index futures: Prices are higher and hit a 2.5-month high in early U.S. trading. A price uptrend is in place on the daily chart. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at the overnight high of 9,238.00 and then at 9,300.00. On the downside, shorter-term support is seen at the overnight low of 9,103.25 and then at 9,000.00. Wyckoff’s Intra-Day Market Rating: 6.5.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are modestly higher in early U.S. trading. Bulls have the overall technical advantage amid recent choppy trading. 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 bullish early today. Shorter-term technical resistance is seen at the overnight high of 181 24/32 and then at 182 even. Shorter-term support lies at the overnight low of 180 22/32 and then at 180 even. Wyckoff’s Intra-Day Market Rating: 5.5
June U.S. T-Notes: Prices are modestly higher and hit a two-week high in early U.S. trading. Bulls have the firm overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is even with the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term resistance lies at the overnight high of 139.16.0 and then at the April high of 139.22.0. Shorter-term technical support lies at the overnight low of 139.04.0 and then at 139.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
U.S. DOLLAR INDEX
The June U.S. dollar index is modestly lower in early U.S. trading. Bulls have the overall near-term technical advantage. The shorter-term moving averages for the dollar index are neutral early today, as the 4-day is above the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at 100.000 and then at this week’s high of 100.455. Shorter-term support is seen at 99.375 and then at 99.000. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
June Nymex crude oil prices are higher in early U.S. trading. It strongly appears a market bottom is in place. 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 bullish early today. Look for buy stops to reside just above technical resistance at $25.00 and then at $26.00. Look for sell stops just below technical support at $23.00 and then at $22.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
US grain futures are mixed to higher in early US pre-market trading, on more short covering from recent losses and amid better trader and investor risk appetite late this week. The apparent U.S.-China easing of tensions this week is also bullish for the grain markets. Grain bears remain in overall technical control. However, raw commodity sector leader crude oil’s big recovery in prices recently suggests the sector, including grains, may have already bottomed out.
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