Friday, January 20–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly up overnight. U.S. stock indexes are pointed toward steady to slightly firmer openings when the New York day session begins. Trader and investor risk appetite is not as robust as that seen the first half of January.
The marketplace is so far not being impacted significantly by the U.S. Congress and its debt ceiling standoff. Read a Barron’s story today: “Congress is playing with the fire of U.S. government bonds, the bedrock of the global financial system. If lawmakers put dynamite in that foundation by allowing the U.S. to default on interest payments, it will likely cause an earthquake.”
Gold prices hit a nine-month high overnight, boosted in part by bullish technicals and some safe-haven demand as the U.S. stock indexes have turned wobbly this week.
The key outside markets today see the U.S. dollar index firmer. Nymex crude oil futures prices are higher and trading around $81.00 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently fetching 3.44%.
U.S. economic data due for release Friday includes is light and includes existing home sales.
–Jim
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are slightly up 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. 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 Thursday’s high of 3,948.75 and then at 4,000.00. Support for active traders is seen at this week’s low of 3,901.75 and then at 3,850.00. Wyckoff’s Intra-day Market Rating: 5.0
March Nasdaq index futures: Prices are firmer in early U.S. trading. 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 11,500.00 and then at 11,650.00. On the downside, shorter-term support is seen at this week’s low of 11,308.50 and then at 11,000.00. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are lower in early U.S. trading, on a corrective pullback after hitting a four-month high Thursday. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at the overnight high of 131 27/32 and then at this week’s high of 132 31/32. Shorter-term support lies at 130 even and then at 129 even. Wyckoff’s Intra-Day Market Rating: 4.0
March U.S. T-Notes: Prices are lower in early U.S. trading, on a corrective pullback after hitting a four-month high Thursday. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term resistance lies at the overnight high of 115.21.0 and then at 116.00.0. Shorter-term technical support lies at 115.00.0 and then at 114.24.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The March Euro currency futures are slightly lower in early U.S. trading. Prices hit an eight-month high Wednesday. Bulls have the solid overall near-term technical advantage. 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 neutral to bullish early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.0927 and then at 1.1000. Shorter-term support is seen at 1.0800 and then at 1.0750. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
February Nymex crude oil prices are slightly up in early U.S. trading. The shorter-term moving averages are bullish early today as the 4-day is above the 9-day and 18-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 $81.50 and then at this week’s high of $82.38. Look for sell stops just below technical support at this week’s low of $78.13 and then at $77.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Prices were mixed to mostly weaker overnight. Risk aversion in the general marketplace late this week is a bearish element for the grain markets. Corn and soybean market bulls have the near-term technical advantage. Wheat futures bears have the advantage.
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