Tuesday, December 1–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed to higher overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins. There remains little risk aversion in the marketplace on this first day of December, amid global stock market rallies that see the U.S. stock indexes at or near record highs.
In overnight news, the Paris-based OECD think tank has forecast global economic growth in 2021 at 4.2%, which is lower than the 5% growth in its last forecast. The OECD lowered U.S. economic growth in 2021 to 3.2% from 4%, and lowered Euro zone growth to 3.6% from 5.1%.
Meantime, the Euro zone consumer price index for November fell 0.3% from October, which was in line with market expectations.
One feature in the marketplace recently has been soaring Bitcoin prices, which this week hit a record high near $20,000. Some are proclaiming Bitcoin is the new safe-haven gold. When it comes to Bitcoin’s concept, some say they get it and some say they don’t get it. Only time will tell which camp is correct. Overall markets history does suggest the extreme daily price moves in Bitcoin are indicative of a market that is near a major top. As for gold, reports say the yellow metal has seen three straight weeks of gold-backed ETF outflows.
The U.S. dollar index is lower today after hitting a 2.5-year low Monday. The other important outside market sees January Nymex crude oil futures prices near steady and trading around $45.25 a barrel. The OPEC oil cartel is meeting this week and will be discussing keeping its present production cuts. The yield on the benchmark 10-year U.S. Treasury note futures is currently trading at 0.85%.
U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the U.S. manufacturing PMI, the ISM report on manufacturing, and construction spending.
–Jim
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are higher in early U.S. trading and very close to a 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. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at the contract and record high of 3,657.50 and then at 3,680.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at the overnight low of 3,618.00 and then at Monday’s low of 3,583.75. Wyckoff’s Intra-day Market Rating: 7.0
March Nasdaq index futures: Prices are higher and very close to the contract and record high in early U.S. trading. Bulls have the solid overall near-term technical advantage. 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 bullish early today. Shorter-term technical resistance is seen at the contract and record high of 12,420.75 and then at 12,500.00. On the downside, shorter-term support is seen at 12,225.00 and then at Monday’s low of 12,082.00. Wyckoff’s Intra-Day Market Rating: 7.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are weaker in early U.S. trading. Bears have the near-term technical advantage. 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 to bearish early today. Shorter-term technical resistance is seen at Monday’s high of 175 10/32 and then at last week’s high of 175 21/32. Shorter-term support lies at the overnight low of 174 10/32 and then at 174 even. Wyckoff’s Intra-Day Market Rating: 4.0
March U.S. T-Notes: Prices are weaker in early U.S. trading. Bears have the near-term technical advantage. 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 bearish early today. Shorter-term resistance lies at Monday’s high of 138.08.0 and then at 138.12.0. Shorter-term technical support lies at 137.28.0 and then at last week’s low of 137.23.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The March Euro currency futures are in early U.S. trading. The shorter-term moving averages for the Euro 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 for the Euro are neutral to bullish early today. The Euro currency finds shorter-term technical resistance at September high of 1.2045 and then at 1.2100. Shorter-term support is seen at Monday’s low of 1.1957 and then at 1.1900. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
January Nymex crude oil prices are near steady in early U.S. trading. Bulls have the solid overall near-term technical advantage. 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 neutral early today. Look for buy stops to reside just above technical resistance at Monday’s high of $45.80 and then at last week’s high of $46.26. Look for sell stops just below technical support at Monday’s low of $44.42 and then at $44.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
US grain futures are mixed to firmer in early U.S. pre-market trading. The bulls are fading a bit early this week and need to step up and show fresh power after solid losses Monday. The grain market bulls still have the firm overall near-term technical advantage.
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