Wednesday, December 13–Jim Wyckoff’s morning markets report
U.S. stock indexes are headed for slightly higher openings when the New York day session begins.
On tap today is the U.S. producer price index report for November, which is seen coming in at up 0.1% from the previous month and compares to the 0.5% decline seen in the October PPI report. Tuesday’s consumer price index report for November came in very close to market expectations.
Focus is now on the two-day Federal Open Market Committee (FOMC) monetary policy meeting of the Federal Reserve that began Tuesday morning and ends Wednesday afternoon with a statement and press conference from Fed Chairman Jerome Powell. The marketplace consensus is that the FOMC will leave U.S. interest rates unchanged. However, it’s also expected the FOMC statement and Powell at his press conference will still lean hawkish by saying the inflation fight is not yet finished. Still, many market watchers expect the Fed to cut U.S. interest rates by mid-year in 2024.
In other news, China’ annual economic conference produced no significant stimulus measures to boost the world’s second-largest economy. That put Asian investors in downbeat moods at mid-week.
Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, and the weekly DOE liquid energy stocks report.
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are slightly up in early U.S. trading and hit a 4.5-month high overnight. 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 bullish early today. Today, shorter-term technical resistance comes in at the July high of 4,738.50 and then at 4,775.00. Support for active traders is seen at this week’s low of 4,652.00 and then at 4,625.00. Wyckoff’s Intra-day Market Rating: 6.0
March Nasdaq index futures: Prices are slightly up and hit a contract high 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 is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at 16,700.00 and then at 16,800.00. On the downside, shorter-term support is seen at 16,500.00 and then at Tuesday’s low of 16,396.50. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are higher 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. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at this week’s high of 120 9/32 and then at the December high of 120 25/32. Shorter-term support lies at 119 even and then at this week’s low of 118 9/32. Wyckoff’s Intra-Day Market Rating: 6.0
March U.S. T-Notes: Prices are firmer in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at this week’s high of 110.31.5 and then at the December high of 111.09.5. Shorter-term technical support is seen at Tuesday’s low of 110.07.5 and then at this week’s low of 109.31.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
EURO CURRENCY
The March Euro currency futures are slightly down in early U.S. trading. Bulls and bears are on a level overall near-term technical playing field. 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 neutral early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.0875 and then at 1.0900. Shorter-term support is seen at last week’s low of 1.0770 and then at 1.0750. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
January Nymex crude oil prices are slightly higher in early U.S. trading after hitting a 5.5-month high overnight. The shorter-term moving averages 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 (RSI and slow stochastics) are neutral to bearish early today. Look for buy stops to reside just above technical resistance at $70.00 and then at this week’s high of $71.96. Look for sell stops just below technical support at the overnight low of $67.71 and then at $67.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures prices were lower overnight. The bearish crude oil market is weighing on the grains. Charts are overall bearish for corn and wheat, but the recent rally in wheat markets suggest market bottoms are in place. Technicals are slightly bearish for soybeans and meal as those 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