Thursday, January 18–Jim Wyckoff’s morning markets report
Asian and European stock markets were mixed to firmer overnight. U.S. stock index futures are set to open modestly up when the New York day session begins.
In overnight news, geopolitical tensions in the Middle East ratcheted up another notch as Pakistan launched retaliatory airstrikes inside Iran, killing at least 9 people. The strikes follow Iran’s attack Tuesday on Pakistani soil that killed two. The risk of escalation remained Thursday as Iran began a planned air defense drill from its port of Chabahar near Pakistan. Meantime, the U.S. has launched more air strikes against Iranian-backed Houthi rebel targets in Yemen.
U.S. economic data due out Thursday includes the weekly jobless claims report, the Philadelphia Fed business survey, new residential construction and the weekly DOE liquid energy stocks report.
STOCK INDEXES
March S&P 500 e-mini futures: Prices are firmer in early U.S. trading. 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 even with 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 this week’s high of 4,823.00 and then at the contract high of 4,841.50. Support for active traders is seen at this week’s low of 4,746.25 and then at 4,725.00. Wyckoff’s Intra-day Market Rating: 5.5
March Nasdaq index futures: Prices are higher in early U.S. trading. Bulls have the firm near-term technical advantage. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above with the 9-day and 18-day. The 9-day is even with the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at last week’s high of 17,057.00 and then at the contract high of 17,165.25. On the downside, shorter-term support is seen at this week’s low of 16,689.25 and then at 16,600.00. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are slightly up in early U.S. 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 neutral early today. Shorter-term technical resistance is seen at 122 even and then at this week’s high of 123 3/32. Shorter-term support lies at this week’s low of 120 12/32 and then at 120 even. Wyckoff’s Intra-Day Market Rating: 5.5
March U.S. T-Notes: Prices are firmer in early U.S. 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 neutral early today. Shorter-term resistance lies at Wednesday’s high of 112.01.5 and then at this week’s high of 112.18.5. Shorter-term technical support is seen at the January low of 111.06.5 and then at 111.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The March Euro currency futures are up a bit in early U.S. trading. The shorter-term moving averages for the Euro are bearish early today, as the 4-day is below the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are neutral to bullish early today. The Euro currency finds shorter-term technical resistance at 1.0950 and then at 1.1000. Shorter-term support is seen at this week’s low of 1.0871 and then at 1.0800. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
February Nymex crude oil prices are slightly up in early U.S. trading. The shorter-term moving averages are neutral early today as the 4-day is below the 9-day. The 9-day is even with the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral early today. Look for buy stops to reside just above technical resistance at this week’s high of $73.56 and then at the January high of $75.25. Look for sell stops just below technical support at this week’s low of $70.50 and then at the January low of $69.28. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Grain futures prices were mixed overnight. Not much new this week. Charts remain fully bearish for corn and wheat. Technicals are also bearish for soybeans, meal and soybean oil. All the grain markets are trending down on the daily bar charts.
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