Tuesday, October 24–Jim Wyckoff’s morning markets report
There has been no major military escalation in the Israel-Hamas war this week, which has allowed the marketplace to better focus on other matters and to inject a bit more risk appetite into the markets. However, most veteran market watchers know this Middle East situation has the high potential to flare up very quickly and roil the marketplace.
The key outside markets today see the U.S. dollar index higher. Nymex crude oil prices are a bit higher and trading around $86.00 a barrel. The yield on the benchmark U.S. Treasury 10-year note yield is presently fetching 4.857%.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook retail sales report, the U.S. flash services and manufacturing PMIs, and the Richmond Fed business activity survey.
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are firmer on short covering after hitting a five-month low on Monday. The shorter-term moving averages (4-, 9- and 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-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 Monday’s high of 4,280.75 and then at 4,300.00. Support for active traders is seen at Monday’s low of 4,213.25 and then at 4,200.00. Wyckoff’s Intra-day Market Rating: 5.5
December Nasdaq index futures: Prices are higher on short covering after hitting a five-month low on Monday. Shorter-term moving averages (4- 9-and 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 14,900.00 and then at 15,000.00. On the downside, shorter-term support is seen at 14,600.00 and then at 14,500.00. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are weaker in early U.S. trading. Price action Monday scored a bullish “key reversal” up, which is one technical clue that a market bottom is in place. Shorter-term moving averages (4- 9- 18-day) are still 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 the overnight high of 110 16/32 and then at 111 even. Shorter-term support lies at 109 even and then at 108 even. Wyckoff’s Intra-Day Market Rating: 4.5
December U.S. T-Notes: Prices are weaker 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 the overnight high of 106.22.0 and then at 107.00.0. Shorter-term technical support is seen at 106.00.0 and then at the contract low of 105.10.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The December Euro currency futures are lower in early U.S. trading after hitting a four-week high overnight. Bears are still in overall near-term technical control. However, a price downtrend on the daily bar chart has been negated and prices are starting to trend up, which are early clues that a market bottom is in place. 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 to bearish early today. The Euro currency finds shorter-term technical resistance at the overnight high of 1.0721 and then at 1.0780. Shorter-term support is seen at 1.0600 and then at 1.0523. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
December Nymex crude oil prices are slightly higher 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 neutral to bearish early today. Look for buy stops to reside just above technical resistance at $88.00 and then at $89.00. Look for sell stops just below technical support at $85.00 and then at $84.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures prices were weaker in overnight trading. Technicals are overall bearish for corn and wheat, and neutral for soybeans. The bullish meal market suggests soybeans will also see some more upside price action in the near term.
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