Thursday, July 27–Jim Wyckoff’s morning markets report
The marketplace Thursday morning looks like it has pretty much digested Wednesday afternoon’s 25 basis-point interest rate increase from the Federal Reserve. Fed Chair Powell’s remarks at his press conference were deemed not too hawkish and not too dovish and the markets showed no big reactions. Some Fed watchers are thinking the central bank is now done with its rate-hike cycle, while others think the Fed will do one more rate increase in November.
In overnight news, the European Central Bank is expected to slightly raise its main interest rate at today’s monetary policy meeting.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the advance estimate for second-quarter GDP that includes the closely watched PCE price index, durable goods orders, advance economic indicators, pending home sales and the Kansas City Fed manufacturing survey.
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are higher in early U.S. trading and hit a 15-month high overnight. Bulls have the solid overall near-term technical advantage. The 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 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 4,650.00 and then at 4,675.00. Support for active traders is seen at the overnight low of 4,591.25 and then at this week’s low of 4,560.00. Wyckoff’s Intra-day Market Rating: 6.5
September Nasdaq index futures: Prices are higher in early U.S. trading. Bulls have the solid near-term technical advantage. 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the July high of 16,062.75 and then at 16,250.00. On the downside, shorter-term support is seen at the overnight low of 15,631.50 and then at this week’s low of 15,483.75. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are weaker in early U.S. trading. 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 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 126 10/32 and then at this week’s high of 127 2/32. Shorter-term support lies at this week’s low of 125 10/32 and then at 125 even. Wyckoff’s Intra-Day Market Rating: 4.0
September U.S. T-Notes: Prices are lower in early U.S. trading. 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 above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at the overnight high of 112.07.0 and then at this week’s high of 112.17.5. Shorter-term technical support is seen at this week’s low of 111.17.5 and then at 111.08.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The September Euro currency futures are higher in early U.S. trading. 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 this week’s high of 1.1177 and then at 1.1200. Shorter-term support is seen at the overnight low of 1.1105 and then at this week’s low of 1.1051. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
September Nymex crude oil prices are higher in early U.S. trading and near this week’s three-month high. 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 this week’s high of $79.90 and then at the April high of $81.44. Look for sell stops just below technical support at Tuesday’s low of $78.29 and then at $77.00. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
Grain futures prices were slightly higher in overnight trading. Weather in the Midwest leans bullish: hot with little to no precipitation this week. The Russia-Ukraine war has recently escalated to include more attacks on Ukraine grain facilities. Technicals are fully bullish for soybeans and moderately bullish for corn and wheat futures. On tap today is the weekly USDA export sales report.
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