Friday, May 13–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly higher overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins. The U.S. stock indexes are seeing short covering in a bear market after the major indexes hit 12-month lows Thursday. Risk aversion may have down-ticked a bit on this last trading day of the week, but it remains elevated due to the Russia-Ukraine war, Covid in China and rising global inflation.
In overnight news, the crypto currencies, including bitcoin, rallied on corrective bounces after their shellacking earlier this week.
The key outside markets today see Nymex crude oil futures prices higher and trading around $108.00 a barrel. Meantime, the U.S. dollar index is weaker in early trading, but not far below this week’s 20-year high. The yield on the 10-year U.S. Treasury note is fetching 2.889% after trading above 3% earlier this week. For perspective, the German 10-year bund yield is presently 0.897% and the 10-year U.K. gilt yield is 1.718%.
U.S. economic data due for release Friday includes import and export prices, and the University of Michigan consumer sentiment survey.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are higher on short covering after hitting a 12-month low Thursday. Prices are still in a downtrend on the daily bar chart and bears have the solid near-term technical advantage. 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 neutral to bullish early today. Today, shorter-term technical resistance comes in at 4,000.00 and then at 4,050.00. Support for active traders is seen at the overnight low of 3,915.50 and then at this week’s low of 3,855.00. Wyckoff’s Intra-day Market Rating: 6.0
June Nasdaq index futures: Prices are higher on short covering after hitting a 12-month low on Thursday. Prices are still trending down on the daily bar chart and bears have the solid technical advantage. 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 neutral to bullish early today. Shorter-term technical resistance is seen at 12,250.00 and then at 12,500.00. On the downside, shorter-term support is seen at the overnight low of 11,891.50 and then at this week’s low of 11,689.00. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are solidly lower in early U.S. trading. Bears are in solid overall near-term technical control. 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 early today. Shorter-term technical resistance is seen at the overnight high of 140 20/32 and then at this week’s high of 141 3/32. Shorter-term support lies at 139 even and then at 138 even. Wyckoff’s Intra-Day Market Rating: 4.0
June U.S. T-Notes: Prices are solidly lower in early U.S. trading. Bears are in solid overall near-term technical control. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at the overnight high of 119.23.5 and then at this week’s high of 120.00.5. Shorter-term technical support lies at Thursday’s low of 119.04.5 and then at 119.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The June Euro currency futures are firmer on short covering after hitting a contract low Thursday. Bears 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. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are neutral today. The Euro currency finds shorter-term technical resistance the 1.0450 and then at 1.0500. Shorter-term support is seen at the contract low of 1.0366 and then at 1.0300. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
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. 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 the overnight high of $108.46 and then at $110.00. Look for sell stops just below technical support at the overnight low of $106.29 and then at $105.00. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
U.S. grain futures prices were mixed in early U.S. pre-market trading. Grain market bulls have the firm overall near-term chart advantage. Wheat has now taken over leadership in the bullish camp after a bullish USDA report for wheat on Thursday drove SRW prices to a 14-year high.
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