Monday, April 19–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins, on a pause after hitting record highs last week. It’s a quieter start to the trading week. There is no major U.S. economic data due for release Monday and the pace for U.S. data is slow up until Thursday.
Gold prices are higher and hit a seven-week high in early U.S. trading, due in part to reports late last week the Chinese government will allow domestic and foreign banks to import larger amounts of the precious metal into China. Such could also lead to more consumer demand for gold from China, already a major gold importer for consumers.
Bitcoin prices are higher Monday after a huge drop over the weekend after Turkey’s central bank said it would ban the crypto currency’s use as a form of payment. Bitcoin investors are worried other central banks could do the same. However, it seems that Bitcoin has come too far into the investment fold for many, including high rollers on Wall Street, which suggests any crackdown by a major world central bank would be unlikely.
The key outside markets today see the U.S. dollar index down and hitting a six-week low. The greenback bulls are presently reeling. Nymex crude oil prices are weaker and trading around $63.00 a barrel. Meantime, the yield on the benchmark 10-year U.S. Treasury note is presently fetching around 1.562%, continuing to slip from highs seen earlier in April.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are slightly lower in early U.S. trading on a mild corrective pullback after hitting a contract and record high on Friday. 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 the record high of 4,183.50 and then at 4,200.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at 4,150.00 and then at 4,130.00. Sell stops likely reside below those levels. Wyckoff’s Intra-day Market Rating: 4.5
June Nasdaq index futures: Prices are slightly lower in early U.S. trading on a slight downside correction after hitting a record high late last week. 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 to bearish early today. Shorter-term technical resistance is seen at the contract high of 14,059.50 and then at 14,200.00. Buy stops likely reside just above those levels. On the downside, shorter-term support is seen at 13,900.00 and then at 13,800.00. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are slightly up in early U.S. trading today. Bears still have the overall near-term technical advantage. However, recent sideways-to-higher price action at lower levels may be “basing” that puts in a market bottom. Prices are also in a fledgling uptrend on the daily chart. 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 early today. Shorter-term technical resistance is seen at last week’s high of 159 1/32 and then at 159 16/32. Buy stops likely reside just above those levels. Shorter-term support lies at 157 16/32 and then at 157 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
June U.S. T-Notes: Prices are near steady 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 and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at last week’s high of 132.22.0 and then at 132.28.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at 132.06.0 and then at 132.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
EURO CURRENCY
The June Euro currency futures are a solidly higher in early U.S. trading and hit a six-week high. 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 bullish early today. The Euro currency finds shorter-term technical resistance at 1.2100 and then at 1.2150. Buy stops likely reside just above those levels. Shorter-term support is seen at 1.2000 and then at the overnight low of 1.1956. Sell stops likely reside just below those levels. Wyckoff’s Intra Day Market Rating: 6.5
NYMEX CRUDE OIL
June Nymex crude oil prices are slightly lower in early U.S. trading. Bulls have the firm overall near-term technical advantage. The shorter-term moving averages are bullish early today as the 4-day is above the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral early today. Look for buy stops to reside just above technical resistance at last week’s high of $63.94 and then at $64.50. Look for sell stops just below technical support at $62.00 and then at $61.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
U.S. grain futures are higher to solidly higher in early U.S. pre-market trading. Prices are near their recent highs. Weather in the U.S. midsection will be market-sensitive in the coming weeks as corn planters start to roll. Right now, cold weather and even some snow forecast for the Corn Belt is supportive for prices. The world supply and demand balance sheet for the grains remains bullish—especially for corn and soybeans.
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