Thursday, August 4–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly slightly up overnight. U.S. stock indexes are pointed toward mildly higher openings when the New York day session beings. The marketplace is a bit more nervous today after China fired several ballistic missiles around Taiwan, in apparent retaliation for U.S. House Speaker Nancy Pelosi’s visit to Taiwan on Tuesday.
Traders in Europe are awaiting the Bank of England’s monetary policy meeting conclusion Thursday. The BOE is expected to raise its key interest rate by 0.5%.
The marketplace is looking ahead to Friday morning’s U.S. jobs report for July, which is expected to show non-farm payrolls job growth of around 260,000, compared to a rise of 372,000 in the June report.
The key outside markets today see Nymex crude oil prices higher and trading around $91.50 a barrel. The U.S. dollar index is lower in early U.S. trading. The yield on the 10-year U.S. Treasury note is fetching 2.727%.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the Challenger job-cuts report, the international trade report, and monthly retail chain store sales.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are a bit higher in early U.S. trading and near this week’s nearly two-month high. Bulls have the overall near-term technical advantage amid a price uptrend in place 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 and 18-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 4,200.00 and then at 4,250.00. Support for active traders is seen at 4,120.00 and then at this week’s low of 4,080.50. Wyckoff’s Intra-day Market Rating: 6.0
September Nasdaq index futures: Prices are modestly up in early U.S. trading and hit a three-month high. Prices are trending higher on the daily bar chart and 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 bullish early today. Shorter-term technical resistance is seen at 13,500.00 and then at 13,700.00. On the downside, shorter-term support is seen at the overnight low of 13,227.25 and then at 13,000.00. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are slightly up in early U.S. trading. Prices are in a six-week-old price uptrend on the daily bar chart. 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 143 20/32 and then at 144 even. Shorter-term support lies at 142 even and then at this week’s low of 141 5/32. Wyckoff’s Intra-Day Market Rating: 5.5
September U.S. T-Notes: Prices are firmer in early U.S. trading. Bulls have the overall near-term technical advantage amid a six-week-old uptrend in place on the daily bar chart. 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 bearish early today. Shorter-term resistance lies at the overnight high of 120.14.0 and then at 120.24.0. Shorter-term technical support lies at 120.00.0 and then at 119.20.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The September Euro currency futures are up in early U.S. trading. Bears have the firm overall near-term technical advantage. However, trading has been sideways and choppy for three weeks. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is even with the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.0327 and then at 1.0400. Shorter-term support is seen at last week’s low of 1.0134 and then at 1.0100. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
Nymex crude oil prices are higher in early U.S. trading after hitting a three-week low overnight. Bears have the overall near-term technical advantage. 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 neutral early today. Look for buy stops to reside just above technical resistance at $93.00 and then at $95.00. Look for sell stops just below technical support at $90.00 and then at the July low of $88.23. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
U.S. grain futures were narrowly mixed overnight. Market fundamentals have become much less bullish this week. Weather forecasts have better rain chances and less high heat for the U.S. Corn Belt over the next 10 days. Corn and soybean bears have gained the overall near-term technical advantage amid recent choppy trading, while wheat bears have the solid near-term technical advantage. On tap today is the weekly USDA export sales 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