Monday, October 4–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed but mostly lower in overnight trading. The U.S. stock indexes are pointed to lower openings when the New York day session begins. There is some risk aversion in the marketplace to start the trading week. Reports said trading in the Chinese property giant Evergrande was halted in Hong Kong Monday, amid reports the troubled firm may be acquired by another firm. China’s markets are closed for a national holiday, Golden Week, until Friday.
Meantime, the Biden administration and Democrats are continuing to struggle to agree on a big spending bill, while at the same time grappling with trying to get the U.S. debt limit raised so the government can pay its bills beyond this month.
Also, reports said mainland Chinese warplanes have been buzzing Taiwan airspace, with Taiwan officials asking the U.S. for help on the matter.
The key outside markets today see the U.S. dollar index weaker. Nymex crude oil futures are near steady and trading around $76.00 a barrel. Meantime, the 10-year U.S. Treasury note yield is presently fetching 1.491%.
U.S. economic data due for release Monday is light and includes manufacturers’ shipments and inventories.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are lower in early U.S. trading. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 4,362.00 and then at 4,389.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at the overnight low of 4,315.00 and then the September low of 4,293.75. Sell stops likely reside below those levels. Wyckoff’s Intra-day Market Rating: 4.0
December Nasdaq index futures: Prices are lower in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are bearish early today. The 4-day moving average is below the 9-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at the overnight high of 14,835.00 and then at 14,926.00. Buy stops likely reside just above those levels. On the downside, shorter-term support is seen at the overnight low of 14,633.50 and then at last week’s low of 14,537.00. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are lower 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 160 20/32 and then at 161 even. Buy stops likely reside just above those levels. Shorter-term support lies at 159 even and then at last week’s low of 158 22/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
December U.S. T-Notes: Prices are lower 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. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance is seen at the overnight high of 132.08.5 and then at 132.14.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at 131.24.0 and then at 131.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The December Euro currency futures are up in early U.S. trading. Bears still have the solid overall near-term technical advantage. The shorter-term moving averages for the Euro 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 for the Euro are bullish early today. The Euro currency finds shorter-term technical resistance at 1.1650 and then at 1.1690. Buy stops likely reside just above those levels. Shorter-term support is seen at the overnight low of 1.1603 and then at last week’s low of 1.1578. Sell stops likely reside just below those levels. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
Nymex crude oil prices are near steady in early U.S. trading. Bulls are still in solid technical control. 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 neutral to bullish early today. Look for buy stops to reside just above technical resistance at last week’s high of $76.67 and then at $77.00. Look for sell stops just below technical support at $75.00 and then at $74.00. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
U.S. grain futures were mixed to weaker overnight. The corn and soybean market bears have the near-term technical advantage, while the wheat bulls have the near-term technical advantage. Grain traders will look more to the outside markets in the near term, as the stock markets are wobbly at present and there is keener risk aversion in the marketplace. That’s bearish for grains. On tap today is the weekly USDA export inspections report.
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