Tuesday, August 16–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed to firmer overnight. U.S. stock indexes are pointed toward weaker openings when the New York day session begins. Corporate earnings reports are in focus this week. Risk appetite in the marketplace this week is less than robust after some downbeat economic from China that prompted China’s central bank to ease its monetary policy. Also, a weaker U.S. Empire State manufacturing report on Monday has ratcheted up worries about an impending U.S. recession.
The key outside markets today see Nymex crude oil prices lower and trading around $88.80 a barrel. Reports said Iran may be taking steps in its nuclear program to ease international sanctions on Iranian oil. The U.S. dollar index is higher in early U.S. trading. The yield on the 10-year U.S. Treasury note is fetching 2.802%.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and chain store sales indexes, new residential construction, and industrial production and capacity utilization.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are a bit lower in early U.S. trading, on a mild, routine corrective pullback after hitting a 3.5-month high Monday. Bulls have the overall near-term technical advantage amid a price uptrend in place on the daily bar chart. 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 Monday’s high of 4,304.75 and then at 4,350.00. Support for active traders is seen at Monday’s low of 4,249.00 and then at 4,200.00. Wyckoff’s Intra-day Market Rating: 4.5
September Nasdaq index futures: Prices are slightly down in early U.S. trading, on a corrective pullback after hitting a four-month high Monday. Prices are trending higher on the daily bar chart and bulls have the 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 neutral to bearish early today. Shorter-term technical resistance is seen at Monday’s high of 13,706.00 and then at 13,850.00. On the downside, shorter-term support is seen at Monday’s low of 13,495.25 and then at 13,312.00. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are near steady in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at Monday’s high of 142 3/32 and then at 143 even. Shorter-term support lies at 141 even and then at Monday’s low of 140 13/32. Wyckoff’s Intra-Day Market Rating: 5.0
September U.S. T-Notes: Prices are steady in early U.S. trading. Bulls have the slight overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at Monday’s high of 119.31.0 and then at 120.10.0. Shorter-term technical support lies at Monday’s low of 119.04.5 and then at last week’s low of 118.30.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
EURO CURRENCY
The September Euro currency futures are lower and hit a nearly three-week low 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 bearish early today. The Euro currency finds shorter-term technical resistance at 1.0200 and then at 1.0250. Shorter-term support is seen at 1.0134 and then at 1.0100. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
Nymex crude oil prices are weaker in early U.S. trading. Prices Monday hit a 4.5-month low. Bears have the overall near-term technical advantage. The shorter-term moving averages are neutral early today as the 4-day is above the 9-day. The 9-day is below 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 $90.00 and then at this week’s high of $92.10. Look for sell stops just below technical support at this week’s low of $86.82 and then at $85.00. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
U.S. grain futures were lower overnight. Weaker economic data coming out of China this week, a stronger U.S. dollar, lower crude oil prices and non-threatening Corn Belt weather forecasts are all hitting the grains early this week.
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