Friday, October 29–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed but mostly down in overnight trading. The U.S. stock indexes are pointed to weaker openings when the New York day session begins. Risk appetite has been dented a bit late this week after quarterly results from behemoths Amazon and Apple showed these companies are starting to be crimped by supply-chain constraints.
In overnight news, the Euro zone reported its October consumer price index at up 4.1%, year-on-year, compared to a reading of up 3.4% in the September report. The October number was the hottest since 2008.
The marketplace will monitor this weekend’s G-20 meeting in Rome.
The key outside markets today see the U.S. dollar index higher. Crude oil prices are slightly up and trading around $83.00 a barrel. Meantime, the 10-year U.S. Treasury note yield is presently fetching 1.612%.
U.S. economic data due for release Friday includes personal income and outlays, the employment cost index, the Chicago ISM business survey, and the University of Michigan consumer sentiment survey.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are weaker in early U.S. trading. Bulls have the solid overall near-term technical advantage as prices are still trending up. 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 bearish early today. Today, shorter-term technical resistance comes in at the contract high of 4,590.00 and then at 4,600.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at Thursday’s low of 4,525.45 and then at this week’s low of 4,522.50. Sell stops likely reside below those levels. Wyckoff’s Intra-day Market Rating: 4.5
December Nasdaq index futures: Prices are lower 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. 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 15,777.00 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 this week’s low of 15,295.75. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are lower 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 even with the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the overnight high of 160 21/32 and then at this week’s high of 161 8/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 159 15/32 and then at 159 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
December U.S. T-Notes: Prices are lower 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 neutral to bearish early today. Shorter-term resistance is seen at the overnight high of 130.27.5 and then at 131.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at this week’s low of 130.08.0 and then at the October low of 129.31.0. 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. Bears have the firm overall near-term technical advantage. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is even with the 9-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 this week’s high of 1.1702 and then at 1.1750. Buy stops likely reside just above those levels. Shorter-term support is seen at this week’s low of 1.1591 and then at the October low of 1.1537. Sell stops likely reside just below those levels. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
Nymex crude oil prices are a bit higher in early U.S. trading. Bulls have the solid 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 $84.00 and then at $85.00. Look for sell stops just below technical support at $82.00 and then at this week’s low of $80.58. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
U.S. grain futures were mixed overnight. Corn bulls have gained good momentum this week, to suggest more gains are in the offing. Wheat bulls have the solid overall near-term technical advantage. Soybeans continue to be the laggard. One of two scenarios are likely now: Corn and wheat will drag soybeans higher, or soybeans will drag wheat and corn lower. My bias is that it will be the former and not the latter.
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