Tuesday, November 21–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mostly firmer overnight. U.S. stock indexes are firmer ahead of the opening of the New York day session.
Markets are still reacting to the failed efforts by German Chancellor Angela Merkel to form a coalition government on Sunday. Reports late Monday said Merkel would rather hold another election than form a coalition. This has created uncertainty in world markets but especially in the European markets. The European Union’s largest economy appears to be in leadership crisis. This news has put downside pressure on the Euro currency this week, which in turn has boosted the U.S. dollar index and safe-haven gold prices.
The important outside markets on Tuesday morning see the U.S. dollar index slightly higher. Meantime, Nymex crude oil futures prices are slightly higher and are trading around $56.50 a barrel. Oil bulls still have the overall near-term technical advantage, but stiff chart resistance layers lie just above the market. Traders are looking ahead to next week’s OPEC meeting.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and Goldman Sachs retail sales reports, the Chicago Fed national activity index, and existing home sales.
–Jim
U.S. STOCK INDEXES
S&P 500 December e-mini futures: Prices are firmer in early U.S. trading and back near the contract and record high. Bulls have the solid 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 above the 9-day and 18-day. The 9-day is even with the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at the contract high of 2,594.50 and then at 2,600.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 2,579.25 and then at Monday’s low of 2,567.75. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 6.0
Nasdaq index December futures: Prices are higher in early U.S. trading and back near the contract and record high. The bulls have the solid overall 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 bullish early today. Shorter-term technical resistance is seen at the contract high of 6,358.50 and then at 6,375.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 6,311.25 and then at Monday’s low of 6,291.25. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES
December U.S. T-Bonds: Prices are higher in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are bullish 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 bullish early today. Shorter-term technical resistance is seen at Monday’s high of 154 14/32 and then at the November high of 154 26/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 153 24/32 and then at Monday’s low of 153 3/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
December U.S. T-Notes: Prices are slightly higher in early U.S. trading. Bears still have the overall near-term 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 early today. Shorter-term resistance lies at the overnight high of 124.26.0 and then at 125.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at Monday’s low of 124.22.0 and then at last week’s low of 124.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
U.S. DOLLAR INDEX
The December U.S. dollar index is slightly higher in early U.S. trading. The shorter-term moving averages for the dollar index are bearish as the 4-day is below the 9-day and 18-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 94.250 and then at 94.500. Shorter-term support is seen at Monday’s low of 93.485 and then at last week’s low of 93.305. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
January Nymex crude oil prices are slightly higher in early U.S. trading. Bulls have the overall near-term technical advantage. Look for buy stops to reside just above technical resistance at Monday’s high of $56.93 and then at 57.50. Look for sell stops just below technical support at $56.00 and then at Monday’s low of $55.75. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures markets were mixed overnight. Corn and soybean bulls have gained a bit of momentum early this week, to suggest those markets can at least trade sideways into the end of the year, if not sideways to higher. Focus is on world supply and demand fundamentals, which are not bullish.