Monday, November 21–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly lower overnight. U.S. stock indexes are headed for lower openings when the New York day session begins. Risk aversion is keener to start a U.S. holiday-shortened trading week. U.S. markets are closed Thursday for the Thanksgiving holiday. China has recorded its first Covid deaths in six months as the world’s second-largest economy continues to struggle with rising Covid cases and lockdowns. Reports said infections in Beijing have more than doubled the past few days. This news has stock and commodity markets under pressure due to global demand worries.
Wednesday will be the busiest day for U.S. economic data, including the minutes from the last FOMC monetary policy meeting, to be released in the early afternoon.
The key outside markets today see the U.S. dollar index sharply higher. Nymex crude oil prices are weaker and trading around $79.75 a barrel. The yield on the benchmark U.S. 10-year Treasury note is presently 3.833%.
U.S. economic data due for release Monday is light and includes the Chicago Fed national activity index.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are lower in early U.S. trading. Bulls have the overall near-term technical advantage. Prices are in a five-week-old uptrend 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. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at 4,000.00 and then at the November high of 4,050.75. Support for active traders is seen at last week’s low of 3,912.50 and then at 3,850.00. Wyckoff’s Intra-day Market Rating: 4.0
December Nasdaq index futures: Prices are lower in early U.S. trading. Bulls have the slight 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 and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at the overnight high of 11,756.00 and then at 12,000.00. On the downside, shorter-term support is seen at last week’s low of 11,528.25 and then at 11,250.00. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: 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. 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 the November high of 126 27/32 and then at 128 even. Shorter-term support lies at 125 even and then at 124 even. Wyckoff’s Intra-Day Market Rating: 5.0
December U.S. T-Notes: Prices are weaker 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. 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 the overnight high of 112.17.5 and then at Friday’s high of 112.25.5. Shorter-term technical support lies at last week’s low of 111.27.0 and then at 111.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
EURO CURRENCY
The December Euro currency futures are sharply lower in early U.S. trading. Bulls have the overall near-term technical advantage. Prices are still in a seven-week-old uptrend on the daily bar chart. 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 bearish early today. The Euro currency finds shorter-term technical resistance at the overnight high of 1.0354 and then at 1.0400. Shorter-term support is seen at the overnight low of 1.0246 and then at 1.0200. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
December Nymex crude oil prices are slightly weaker in early U.S. trading. Bears have the near-term technical advantage. The shorter-term moving averages are bearish early today as the 4-day is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral to bearish early today. Look for buy stops to reside just above technical resistance at $81.00 and then at $83.00. Look for sell stops just below technical support at $79.00 and then at $78.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
U.S. grain futures were lower in overnight trading, on demand worries amid China Covid lockdowns. Corn and soybean bulls and bears are on a level overall near-term technical playing field. Wheat bears have the near-term technical advantage. On tap today is the weekly USDA export inspections report and weekly USDA crop progress reports.
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