Tuesday, September 7–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed in quiet overnight trading. The U.S. stock indexes are pointed to narrowly mixed openings when the New York day session begins. Time to get back to work for those North American and European traders and investors that had been coasting the past several weeks. With U.S. stock indexes not far below their recent record highs, market watchers are wondering if those gains can be extended in the coming weeks, during what history shows can be rocky times for the stock and financial markets. Economic data highlights this week include scheduled speeches by some U.S. Federal Reserve officials and the regular monetary policy meeting of the European Central Bank on Thursday. Last Friday’s downbeat U.S. jobs report has many thinking the Fed won’t be able to taper its bond-buying as soon as many Fed officials want.
In overnight news, the Australian central bank said it is going to reduce its bond-buying program by 20%. The central bank left its interest rates unchanged.
Meantime, China got some good economic numbers as its exports in August were up 25.6%, year-on-year, which handily beat expectations of up 17%. Imports rose 33.1% compared to expectations of up 25.7%. The figures were in U.S. dollar terms.
The key outside markets today see the U.S. dollar index higher. Nymex crude oil futures prices are lower and trading around $68.50 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently fetching 1.365%.
U.S. economic data due for release Tuesday is light and includes the employment trends index.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are near steady in early U.S. trading and not far below last week’s contract and record 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 and 18-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 contract high of 4,539.50 and then at 4,550.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at last week’s low of 4,491.50 and then at 4,450.00. Sell stops likely reside below those levels. Wyckoff’s Intra-day Market Rating: 5.5
December Nasdaq index futures: Prices are a slightly down in early U.S. trading after hitting a contract and record high overnight. Bulls have the solid chart advantage. 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 contract high of 15,702.25 and then at 15,800.00. Buy stops likely reside just above those levels. On the downside, shorter-term support is seen at 15,500.00 and then at last week’s low of 15,409.25. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are solidly down 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. 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 the overnight high of 162 26/32 and then at 163 even. Buy stops likely reside just above those levels. Shorter-term support lies at 161 25/32 and then at 161 16/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
December U.S. T-Notes: Prices are down 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. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 133.12.0 and then at 133.16.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at 133.00.0 and then at 132.25.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The December Euro currency futures are slightly lower in early U.S. trading after hitting a four-week high last Friday. Bears still have the overall near-term technical advantage but a downtrend on the daily bar chart has been negated to suggest a near-term 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 1.1938 and then at 1.1975. Buy stops likely reside just above those levels. Shorter-term support is seen at 1.1858 and then at last week’s low of 1.1808. Sell stops likely reside just below those levels. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
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 $69.48 and then at $70.00. Look for sell stops just below technical support at $68.00 and then at $67.00. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
U.S. grain futures were mostly higher overnight, on short covering. The corn and soybean market bears have the overall near-term technical advantage. Technical damage has been inflicted in corn, wheat and soybeans recently, to suggest the path of least resistance for those markets will be sideways to lower in the near term. The major report of the week, if not the month, for the grain markets is Friday’s USDA supply and demand report.
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