Monday, November 15–Jim Wyckoff’s Morning Markets Report
Global stock markets mostly up in overnight trading. The U.S. stock indexes are pointed to firmer openings when the New York day session begins. Traders and investors are weighing the bullish aspect of upbeat third-quarter corporate earnings reports versus the bearish implications of rising inflationary pressures. Gold prices rose to a five-month high overnight as investors seek out the hard asset as a hedge against rising inflation.
Another worrisome element in the marketplace is rising Covid-19 cases in China and parts of Europe. Some countries are again imposing business and public restrictions, which could crimp economic growth.
In other overnight news, China got some positive economic news when its industrial production in October was reported up 3.5%, year-on-year, which was higher than the 2.8% rise expected. Retail sales in October rose 4.9%, year-on-year—better than the 3.5% rise that was expected.
The key outside markets today see the U.S. dollar index a bit weaker after hitting a 15-month high on Friday. Nymex crude oil prices are lower and trading around $79.75 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 1.553%.
U.S. economic data due for release Monday is light and includes the Empire State manufacturing survey. The data pace picks up speed rapidly on Tuesday.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are firmer in early U.S. trading and not far below this month’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 to bullish early today. Today, shorter-term technical resistance comes in at 4,700.00 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 Friday’s low of 4,643.75 and then at last week’s low of 4,625.25. Sell stops likely reside below those levels. Wyckoff’s Intra-day Market Rating: 6.0
December Nasdaq index futures: Prices are slightly higher in early U.S. trading. 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 16,300.00 and the at 16,400.00. Buy stops likely reside just above those levels. On the downside, shorter-term support is seen at 16,000.00 and then at last week’s low of 15,896.50. 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 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 the overnight high of 162 2/32 and then at 162 12/32. Buy stops likely reside just above those levels. Shorter-term support lies at last week’s low of 161 6/32 and then at 161 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
December U.S. T-Notes: Prices are higher 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 and 18-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 the overnight high of 130.27.5 and then at 131.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 130.17.5 and then at last week’s low of 130.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
EURO CURRENCY
The December Euro currency futures are slightly up in early U.S. trading. Prices Friday hit a 16-month low. 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 last week’s low of 1.1439 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 lower in early U.S. trading. Bulls have the overall near-term technical advantage but have faded to suggest a market top is in place. The shorter-term moving averages 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 (RSI and slow stochastics) are bearish early today. Look for buy stops to reside just above technical resistance at the overnight high of $81.20 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: 4.0
GRAINS
U.S. grain futures were steady to firmer overnight. On tap today is the weekly USDA export inspections report. Key for soybeans in the near term is the soybean meal futures market. Meal is trending solidly higher, which signals a market bottom is in place for beans. 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