Monday, July 17–Jim Wyckoff’s morning markets report
Asian and European stock markets were mixed to weaker in overnight trading. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins.
In overnight developments, China got some more downbeat economic news Monday, as the world’s second-largest economy’s gross domestic product showed 6.3% growth in the second quarter, year-on-year, which was below expectations for a rise of 6.9%. The news put some downside price pressure on the metals and crude oil markets. “The Chinese economy is clearly sputtering,” said one analyst in a Wall Street Journal story on the matter.
A couple of interesting headlines in the Wall Street Journal: “Economists dial back (U.S.) recession predictions” and “Traders position for soft landing.”
The key outside markets today see the U.S. dollar index slightly lower. Meantime, Nymex crude oil prices are lower trading around $74.25 a barrel. The benchmark 10-year U.S. Treasury note yield is presently fetching 3.779%.
U.S. economic data due for release Monday is light and includes the Empire State manufacturing survey. The data pace picks up speed Tuesday.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are slightly down in early U.S. trading and near last week’s 15-month high. 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 bearish early today. Today, shorter-term technical resistance comes in at last week’s high of 4,560.50 and then at 4,600.00. Support for active traders is seen at 4,500.00 and then at 4,470.00. Wyckoff’s Intra-day Market Rating: 4.5
September Nasdaq index futures: Prices are near steady in early U.S. trading and not far below last Friday’s contract high. Bulls have the solid near-term technical advantage. 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the contract high of 15,857.25 and then at 16,000.00. On the downside, shorter-term support is seen at 15,500.00 and then at 14,400.00. Wyckoff’s Intra-Day Market Rating: 5.0.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are higher in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at last week’s high of 127 6/32 and then at the July high of 127 24/32. Shorter-term support lies at the overnight low of 126 5/32 and then at 126 even. Wyckoff’s Intra-Day Market Rating: 6.0
September U.S. T-Notes: Prices are higher in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term resistance lies at last week’s high of 113.03.0 and then at 113.15.0. Shorter-term technical support is seen at the overnight low of 112.14.0 and then at 112.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
EURO CURRENCY
The September Euro currency futures are slightly lower in early U.S. trading after hitting another 15-month high overnight. The shorter-term moving averages for the Euro 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 for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at the overnight high of 1.1284 and then at 1.1300. Shorter-term support is seen at 1.1200 and then at 1.1166. Wyckoff’s Intra Day Market Rating: 5.0
NYMEX CRUDE OIL
August Nymex crude oil prices are lower 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 bearish early today. Look for buy stops to reside just above technical resistance at the overnight high of $76.09 and then at the July high of $77.33. Look for sell stops just below technical support at the overnight low of $73.84 and then at $72.50. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
Grain futures prices were higher overnight, supported by news Russia has announced it is pulling out of the grain-shipping deal with Ukraine and the United Nations. The corn market is still overall bearish, soybeans are bullish and wheat neutral to bearish. Weather forecasts for the U.S. Midwest are benign at present.
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