Friday, November 4–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly higher overnight. U.S. stock indexes are headed for higher openings when the New York day session begins, on corrective bounces from the selling pressure seen the past three sessions.
Focus is on Friday morning’s monthly U.S. employment report for October from the Labor Department. The key non-farm payrolls number is expected to come in at up 205,000, compared to a rise of 263,000 in the September report.
In overnight news, the Euro zone September producer price index came in at up 41.9%, year-on-year, which was near expectations. Soaring energy costs in Europe are driving the PPI sharply up.
The key outside markets today see the U.S. dollar index lower on a corrective pullback from strong gains Thursday. Nymex crude oil prices are sharply higher and trading around $91.00 a barrel. The 10-year U.S. Treasury note is yielding 4.142%.
Other U.S. economic data due for release Friday includes the global services purchasing managers’ index.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are higher in early U.S. trading. Bears have the overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is below the 9-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 3,800.00 and then at 3,850.00. Support for active traders is seen at this week’s low of 3,704.25 and then at 3,641.50. Wyckoff’s Intra-day Market Rating: 6.0
December Nasdaq index futures: Prices are firmer in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is below 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 11,000.00 and then at 11,250.00. On the downside, shorter-term support is seen at the overnight low of 10,692.75 and then at the October low of 10,484.75. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are lower in early U.S. trading. Prices are in a three-month-old downtrend on the daily bar chart. Bears have the solid overall technical advantage. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at 121 even and then at 122 even. Shorter-term support lies at 119 even and then at this week’s low of 118 22/32. Wyckoff’s Intra-Day Market Rating: 4.5
December U.S. T-Notes: Prices are weaker in early U.S. trading. Prices are in a three-month-old downtrend on the daily bar chart. Bears have the solid overall technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at Thursday’s high of 110.09.5 and then at 110.20.0. Shorter-term technical support lies at this week’s low of 109.12.0 and then at 109.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
EURO CURRENCY
The December Euro currency futures are firmer in early U.S. trading. Bears have the firm overall near-term technical advantage. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is below 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 Thursday’s high of .9871 and then at .9950. Shorter-term support is seen at this week’s low of .9760 and then at .9700. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
December Nymex crude oil prices are sharply higher and hit a three-week high in early U.S. trading. 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 bullish early today. Look for buy stops to reside just above technical resistance at the October high of $92.34 and then at $94.00. Look for sell stops just below technical support at $90.00 and then at the overnight low of $87.82. Wyckoff’s Intra-Day Market Rating: 6.5
GRAINS
U.S. grain futures were higher in overnight trading, on some short covering and perceived bargain hunting. Corn bulls have the slight overall near-term technical advantage. Soybeans bulls also have the slight chart edge. Wheat bears have the near-term technical advantage. Seasonality studies are starting to favor the grain market bulls as the U.S. corn and soybean harvests wind down.
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