Wednesday, August 24–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed to weaker overnight. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins. It’s quieter at mid-week as the marketplace is awaiting the late-week Jackson Hole, Wyoming Federal Reserve annual symposium, including a speech from Fed Chairman Jerome Powell Friday morning. Past Jackson Hole Fed meetings have significantly moved markets. Markets are expecting Powell to lean hawkish on U.S. monetary policy and on the Fed’s fight against inflation.
The key outside markets today see Nymex crude oil prices higher and trading around $94.50 a barrel. Reports said Saudi Arabia may be looking to cut back on crude oil production. The U.S. dollar index is firmer in early U.S. trading, after hitting a 20-year high on Tuesday. Meantime, the yield on the 10-year U.S. Treasury note is fetching 3.046%. Bond yields have been on the rise recently.
U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, durable goods orders, pending home sales and the weekly DOE liquid energy stocks report.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are slightly down and hit a two-week low in early U.S. trading. Bulls have faded recently as a price uptrend on the daily chart has been negated. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at Tuesday’s high of 4,161.75 and then at 4,200.00. Support for active traders is seen at 4,100.00 and then at 4,080.00. Wyckoff’s Intra-day Market Rating: 5.0
September Nasdaq index futures: Prices are slightly lower and hit a three-week low in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at Tuesday’s high of 13,018.50 and then at 13,200.00. On the downside, shorter-term support is seen at this week’s low of 12,823.50 and then at 12,700.00. Wyckoff’s Intra-Day Market Rating: 5.0.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are slightly weaker in early U.S. trading. Prices are in a downtrend on the daily bar chart. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at 138 even and then at this week’s high of 138 16/32. Shorter-term support lies at this week’s low of 136 17/32 and then at 136 even. Wyckoff’s Intra-Day Market Rating: 4.5
December U.S. T-Notes: Prices are slightly firmer in early U.S. trading. Prices are trending down on the daily bar chart. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at Tuesday’s high of 118.10.0 and then at this week’s high of 118.17.5. Shorter-term technical support lies at this week’s low of 117.17.5 and then at 117.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The December Euro currency futures are lower in early U.S. trading. Bears have the solid overall near-term technical advantage. The shorter-term moving averages for the Euro are bearish early today, 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 Euro are bearish early today. The Euro currency finds shorter-term technical resistance at 1.0100 and then at this week’s high of 1.0131. Shorter-term support is seen at the contract low of .9988 and then at .9900. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
Nymex crude oil prices are higher and hit a three-week high in early U.S. trading. A price downtrend on the daily bar chart has been negated. The shorter-term moving averages are neutral early today as the 4-day is above the 9-day. The 9-day is even with the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bullish early today. Look for buy stops to reside just above technical resistance at the overnight high of $95.40 and then at $97.00. Look for sell stops just below technical support at $93.00 and then at $92.00. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
U.S. grain futures were higher overnight. Corn and soybean bulls are on a roll this week and have regained the near-term technical advantage and still have upside momentum. Wheat remains in a follower’s mode and has made moderate gains this week. Wheat bears still have the solid near-term technical advantage. The focus of grain traders this week is on the Pro Farmer annual corn and soybean crop tour that ends late Thursday, with the tour’s crop production estimates coming out Friday afternoon.
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