Monday, June 5–Jim Wyckoff’s morning markets report
Asian and European stock markets were mixed overnight. U.S. stock indexes are pointed toward mixed openings when the New York day session begins. The stronger U.S. non-farm payrolls jobs rise in last Friday’s May employment report reminded the marketplace that the Federal Reserve is likely to remain hawkish on its monetary policy for longer.
In weekend news, Saudi Arabia decided to unilaterally cut its crude oil production by around 1 million barrels per day, starting in July. Meantime, the OPEC-plus cartel at its meeting decided to leave its collective crude oil output unchanged.
In other news, the Euro zone producer price index for May came in at up 1.0%, year-on-year, which was lower than expected.
The key outside markets today see the U.S. dollar index higher. Nymex crude oil prices are higher and are trading around $73.00 a barrel. Meantime, the benchmark 10-year U.S. Treasury note yield is presently fetching 3.747%.
U.S. economic data due for release Monday includes the U.S. services PMI, the ISM report on business services, the global services PMI, the employment trends index, and manufacturers’ shipments, orders and inventories.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are near steady after hitting a nine-month high on Friday. Bulls have the solid 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 neutral to bullish early today. Today, shorter-term technical resistance comes in at last week’s high of 4,340.75 and then at 4,375.00. Support for active traders is seen at 4,300.00 and then at Friday’s low of 4,269.50. Wyckoff’s Intra-day Market Rating: 5.5
September Nasdaq index futures: Prices are weaker in early U.S. trading after hitting a nine-week high last Friday. Bulls have the solid 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 neutral to bearish early today. Shorter-term technical resistance is seen at last week’s high of 14,800.00 and then at 14,900.00. On the downside, shorter-term support is seen at last week’s low of 14,420.00 and then at 14,300.00. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
September 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 below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at the overnight high of 127 28/32 and then at 128 even. Shorter-term support lies at 126 16/32 and then at 126 even. Wyckoff’s Intra-Day Market Rating: 4.0
September 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 lies at the overnight high of 113.24.5 and then at 114.00.0. Shorter-term technical support is seen at 113.10.0 and then at 113.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The September Euro currency futures are slightly lower in early U.S. trading. The shorter-term moving averages for the Euro are bearish early today, as the 4-day is below the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at last week’s high of 1.0842 and then at 1.0900. Shorter-term support is seen at last week’s low of 1.0702 and then at 1.0650. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
July Nymex crude oil prices are higher in early U.S. trading. The shorter-term moving averages are neutral early today as the 4-day is below the 9-day and 18-day. The 9-day is even with the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bullish early today. Look for buy stops to reside just above technical resistance at the overnight high of $75.06 and then at $76.00. Look for sell stops just below technical support at the overnight low of $72.25 and then at $71.00. Wyckoff’s Intra-Day Market Rating: 6.5
GRAINS
Grain futures prices were mixed overnight. On tap today is the weekly USDA export inspections report. The near-term technical postures for soybeans, meal, bean oil, wheat and corn futures are still all bearish. Weather in the Corn Belt is still mostly benign for the grain markets, but it is dry in some regions. Don’t be surprised if some degree of a weather market scare pops up in the near term.
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