Friday, June 23–Jim Wyckoff’s morning markets report
In overnight news, the Euro zone manufacturing purchasing managers index (PMI) for June came in at 43.6, which was lower than expectations. The June services PMI reading was 52.4, also below expectations. A reading below 50.0 suggests contraction in the sector, and above 50.0 suggests growth.
The key outside markets today see the U.S. dollar index solidly higher. Nymex crude oil prices are lower and trading around $68.75 a barrel. A Dow Jones Newswires headline today reads: “Oil falls as global interest rates rise.” Meantime, the benchmark 10-year U.S. Treasury note yield is presently fetching 3.746%.
U.S. economic due for release Friday includes the U.S. flash and services purchasing managers indexes.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are lower in early U.S. trading. Bulls still have the solid near-term technical advantage. 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 bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 4,426.25 and then at this week’s high of 4,462.00. Support for active traders is seen at 4,375.00 and then at 4,350.00. Wyckoff’s Intra-day Market Rating: 4.0
September Nasdaq index futures: Prices are lower in early U.S. trading. Bulls have the solid near-term technical advantage. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at this week’s high of 15,322.50 and then at the June high of 15,475.50. On the downside, shorter-term support is seen at this week’s low of 14,964.00 and then at 14,800.00. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: 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 above the 9-day. The 9-day is even with the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at this week’s high of 128 11/32 and then at 129 even. Shorter-term support lies at the overnight low of 127 even and then at this week’s low of 126 12/32. Wyckoff’s Intra-Day Market Rating: 6.0
September U.S. T-Notes: Prices are higher in early U.S. trading. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term resistance lies at this week’s high of 113.17.0 and then at 113.24.0. Shorter-term technical support is seen at this week’s low of 112.21.0 and then at the June low of 112.12.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
EURO CURRENCY
The September Euro currency futures are sharply lower in early U.S. trading. The shorter-term moving averages for the Euro are bullish early today, as the 4-day is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators for the Euro are bearish early today. The Euro currency finds shorter-term technical resistance at 1.1000 and then at this week’s high of 1.1061. Shorter-term support is seen at the overnight low of 1.0891 and then at 1.0850. Wyckoff’s Intra Day Market Rating: 3.5
NYMEX CRUDE OIL
August Nymex crude oil prices are lower in early U.S. trading. Bears have the overall near-term technical advantage. The shorter-term moving averages are neutral early today as the 4-day is even with 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 $69.65 and then at $70.00. Look for sell stops just below technical support at the overnight low of $68.06 and then at the June low of $66.96. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
Grain futures prices were lower again overnight on downside corrections from early-week strong gains. Extended weather forecasts for the U.S. Midwest are not quite as bullish, calling for still mostly dry conditions but with some decent rains this weekend in some spots of the Corn Belt. A failing Russia-Ukraine grain-shipping deal is bullish, especially for wheat. Corn, wheat and soybean market bulls all still have the firm near-term technical advantage. Late June and early July is a critical timeframe for the grain markets. At that time the existing price trends in the grains can be accelerated or reversed.
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