Friday, November 12–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed in overnight trading. The U.S. stock indexes are pointed to firmer openings when the New York day session begins. The U.S. stock indexes this week could have their first losing week in five weeks. Global stock markets have become a bit wobbly, on rising concerns about problematic consumer and producer price inflation. The U.S. Fed funds futures market is now signaling a more than 70% chance the Federal Reserve will raise interest rates by next June.
The marketplace is keeping an eye on Russia, which may be weighing a potential invasion of Ukraine. A buildup of Russian forces near the border Ukrainian border has the West concerned. U.S. Secretary of State Blinken said earlier this week the U.S. commitment to Ukraine is “ironclad.” On Thursday Russian ally Belarusian President Alexander Lukashenko threatened to shut gas supplies to the EU, escalating a dispute over migration of refugees through the country.
The key outside markets today see the U.S. dollar index near steady but and hitting another 15-month high overnight. Nymex crude oil prices are solidly lower and trading around $80.00 a barrel. The crude oil market bulls appear to have run out of gas and a market top could be in place. Meantime, the 10-year U.S. Treasury note yield is presently fetching 1.572%.
U.S. economic data due for release Friday is light and includes the University of Michigan consumer sentiment survey.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are firmer in early U.S. trading and not far below last week’s record high. Bulls have the solid overall near-term technical advantage as prices are trending up. 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 early today. Today, shorter-term technical resistance comes in at Wednesday’s high of 4,680.25 and then at the contract and record high of 4,711.25. Buy stops likely reside just above those levels. Downside support for active traders is seen at this week’s low of 4,625.25 and then at 4,600.00. Sell stops likely reside below those levels. Wyckoff’s Intra-day Market Rating: 5.5
December Nasdaq index futures: Prices are slightly higher in early U.S. trading. Prices last week hit a record high. 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at Wednesday’s high of 16,243.00 and the at the contract and record high of 16,448.50. Buy stops likely reside just above those levels. On the downside, shorter-term support is seen at this week’s low of 15,896.50 and then at and then at 15,750.00. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are a bit higher in early U.S. trading. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at Thursday’s high of 162 12/32 and then at 163 even. Buy stops likely reside just above those levels. Shorter-term support lies at this week’s low of 161 9/32 and then at 161 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
December U.S. T-Notes: Prices are firmer in early U.S. trading. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance is seen at Thursday’s high of 130.16.0 and then at 131.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at this week’s low of 130.09.0 and then at 130.07.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The December Euro currency futures are slightly up and hit a 16-month low overnight. 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 early today. The Euro currency finds shorter-term technical resistance at 1.1500 and then at 1.1550. Buy stops likely reside just above those levels. Shorter-term support is seen at the overnight low of 1.1442 and then at 1.1400. Sell stops likely reside just below those levels. Wyckoff’s Intra Day Market Rating: 5.0
NYMEX CRUDE OIL
Nymex crude oil prices are solidly lower in early U.S. trading. Bulls have the overall near-term technical advantage but are fading, to suggest a market top is in place. The shorter-term moving averages are neutral early today as the 4-day is above the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bearish early today. Look for buy stops to reside just above technical resistance at the overnight high of $81.53 and then at $82.00. Look for sell stops just below technical support at the November low of $78.25 and then at $78.00. Wyckoff’s Intra-Day Market Rating: 3.5
GRAINS
U.S. grain futures were mixed overnight. On tap today is the weekly USDA export sales report. Key for soybeans in the near term is the soybean meal futures market. Meal is trending higher, which begins to signal a market bottom is close at hand for soybeans. Corn and wheat bulls have the near-term technical advantage. Corn is presently following the lead of the stronger wheat market.
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