Monday, December 5–Jim Wyckoff’s Morning Markets Report
The key outside markets today see the U.S. dollar index slightly higher after hitting a 3.5-month low Friday. Nymex crude oil prices are higher and trading around $82.00 a barrel. As of Monday, the European Union and the U.K. have barred inbound shipments of crude oil from Russia and put a cap of $60 a barrel on EU companies doing business facilitating Russian oil shipments elsewhere in the world. At a meeting over the weekend the OPEC oil cartel lefts its collective crude oil production unchanged. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently 3.515%.
U.S. economic data due for release Monday includes the U.S. services purchasing managers index (PMI), the global services PMI, the ISM report on business services, the employment trends index, and manufacturers’ shipments and inventories.
–Jim
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are slightly lower in early U.S. trading, on a corrective pullback after hitting a 2.5-month high late last week. Bulls have the firm overall near-term technical advantage. Prices are in a seven-week-old uptrend on the daily bar chart. The 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 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 last week’s high of 4,142.50 and then at the September high of 4,194.25. Support for active traders is seen at 4,050.00 and then at 4,000.00. Wyckoff’s Intra-day Market Rating: 4.5
March Nasdaq index futures: Prices are slightly lower in early U.S. trading on a downside correction after prices last week hit a 2.5-month high. Bulls have the overall near-term technical advantage. 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 bullish early today. Shorter-term technical resistance is seen at last week’s high of 12,257.75 and then at 12,400.00. On the downside, shorter-term support is seen at 12,000.00 and then at 11,800.00. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are near steady in early U.S. trading. Prices Friday hit a nine-week high. 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 last week’s high of 130 9/32 and then at 131 even. Shorter-term support lies at 129 even and then at Friday’s low of 128 7/32. Wyckoff’s Intra-Day Market Rating: 5.0
March U.S. T-Notes: Prices are lower in early U.S. trading. Prices Friday hit a nine-week high. 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 resistance lies at last week’s high of 114.28.5 and then at 115.00.0. Shorter-term technical support lies at the overnight low of 114.10.5 and then at 114.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The March Euro currency futures are firmer in early U.S. trading and hit a five-month high. Bulls have the firm overall near-term technical advantage. Prices are in a nine-week-old uptrend on the daily bar chart. 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 bullish early today. The Euro currency finds shorter-term technical resistance at the overnight high of 1.0663 and then at 1.0700. Shorter-term support is seen at 1.0550 and then at 1.0500. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
January Nymex crude oil prices are higher in early U.S. trading. Bears have the slight overall near-term technical advantage but a price downtrend on the daily bar chart has been negated. Recent price action suggests a market bottom 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 bullish early today. Look for buy stops to reside just above technical resistance at last week’s high of $83.34 and then at $85.00. Look for sell stops just below technical support at $80.00 and then at $78.40. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
U.S. grain futures were steady to slightly up in overnight trading. Bulls have faded recently. Corn and soybean bulls have lost their overall near-term technical advantage. Wheat bears have the solid near-term technical advantage. Grain traders in the near term will focus on the outside markets and on risk appetite in the marketplace. 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