Tuesday, February 15–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed overnight, with European shares mostly up and Asian shares mostly down. U.S. stock indexes are pointed toward solidly higher openings when the New York day session begins. Trader and investor risk appetite has up-ticked a bit Tuesday. The stock indexes have gotten a boost on news reports that some Russian troops are backing away from the Ukrainian border. However, the Ukrainian president on Monday posted on FaceBook that Russia will invade his country on Wednesday. The upshot of the recent news headlines is that the situation is still very unpredictable and the geopolitical crisis is far from abating.
The U.S. data point of the day Tuesday is the latest U.S. inflation report, the producer price index for January, which is seen coming in hot, at up 0.5% from December.
The yield on the U.S. 10-year Treasury note is presently fetching 2.035%. The key outside markets today see crude oil prices sharply down and trading around $92.15 a barrel after hitting a 7.5-year high Monday. The U.S. dollar index is lower early today.
Other U.S. economic data due for release Tuesday includes the Empire State manufacturing survey, Treasury international capital data, and the weekly Johnson Redbook and chain store sales indexes.
–Jim
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are solidly higher in early U.S. trading. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at 4,500.00 and then at 4,525.00. Support for active traders is seen at 4,400.00 and then at this week’s low of 4,354.00. Wyckoff’s Intra-day Market Rating: 6.0
March Nasdaq index futures: Prices are solidly up in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving below the 9-day and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 14,750.00 and then at 15,000.00. On the downside, shorter-term support is seen at the overnight low of 14,233.25 and then at this week’s low of 14,031.00. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are lower and hit a contract low in early U.S. trading. Bears have the solid 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 152 7/32 and then at 153 even. Shorter-term support lies at the overnight contract low of 150 25/32 and then at 150 even. Wyckoff’s Intra-Day Market Rating: 3.5
March U.S. T-Notes: Prices are lower in early U.S. trading and near last week’s contract low. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 126.06.5 and then at 126.12.0. Shorter-term technical support lies at the contract low of 125.17.5 and then at 125.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The March Euro currency futures are solidly higher in early U.S. trading. Bears still have the overall near-term technical advantage. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is below the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.1376 and then at 1.1400. Shorter-term support is seen at this week’s low of 1.1287 and then at 1.1250. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
March Nymex crude oil prices are solidly lower in early U.S. trading after hitting a 7.5-year high of $95.82 Monday. Bulls still have the solid overall near-term technical advantage amid a 10-week-old price uptrend in place on the daily chart. 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 bearish today. Look for buy stops to reside just above technical resistance at $95.00 and then at $95.82. Look for sell stops just below technical support at $91.00 and then at $90.00. Wyckoff’s Intra-Day Market Rating: 3.0
GRAINS
U.S. grain futures are lower in early U.S. pre-market trading, pressured by a general sell off in the raw commodity sector Tuesday, led by sharp losses in crude oil. Grain market bulls still have the overall near-term technical advantage. The keener inflation worries are overall bullish for the grain markets.
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