Tuesday, September 5–Jim Wyckoff’s morning markets report
Trader and investor risk appetite is downbeat to start a U.S.-holiday-shortened trading week as China reported some more downbeat economic data. Its Caixin services purchasing managers index (PMI) came in at 51.8 is August versus 54.1 July and was below expectations of 53.5. The Caixin composite PMI was 51.7 versus 51.9 July.
Meantime, the Australia’s central bank kept its monetary policy unchanged but said further interest rate hikes may be necessary.
The key outside markets today see the U.S. dollar solidly up and at a six-month high. Nymex crude oil futures prices are a bit weaker and trading around $85.25 a barrel. The benchmark U.S. Treasury 10-year note yield is presently fetching around 4.22%.
U.S. economic data due for release Tuesday includes the employment trends index, the IDB/TIPP economic optimism index, and manufacturers’ shipments and inventories.
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are weaker in early U.S. trading. The shorter-term moving averages (4-, 9- and 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Today, shorter-term technical resistance comes in at last week’s high of 4,597.50 and then at 4,625.00. Support for active traders is seen at Wednesday’s low of 4,525.00 and then at 4,500.00. Wyckoff’s Intra-day Market Rating: 4.5
December Nasdaq index futures: Prices are weaker in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at the overnight high of 15,771.75 and then at last week’s high of 15,855.50. On the downside, shorter-term support is seen at 15,500.00 and then at 15,400.00. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are lower in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-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 120 8/32 and then at 121 even. Shorter-term support lies at 119 even and then at 118 16/32. Wyckoff’s Intra-Day Market Rating: 4.0
December U.S. T-Notes: Prices are lower in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 110.17.0 and then at 110.28.0. Shorter-term technical support is seen at 110.00.0 and then at 109.20.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The December Euro currency futures are near lower and hit a three-month low 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 bearish early today. The Euro currency finds shorter-term technical resistance at the overnight high of 1.0863 and then at 1.0900. Shorter-term support is seen at the overnight low of 1.0783 and then at 1.0750. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
October Nymex crude oil prices are a bit weaker but hit a 10-month high overnight. 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 early today. Look for buy stops to reside just above technical resistance at the overnight high of $86.14 and then at $87.50. Look for sell stops just below technical support at $84.00 and then at $83.00. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Grain futures prices were mixed in overnight trading. On tap today is the weekly USDA export inspections report and the weekly crop progress reports. Weather in the Midwest leans slightly bullish for soybean prices. Much of soybean crop needs rain to finish out the growing season. Technicals are bearish for corn and wheat, and bullish for soybeans.
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