Wednesday, September 16–Jim Wyckoff’s Morning Markets Report
Global stock markets were again mostly up overnight. U.S. stock indexes are set for higher openings when the New York day session begins. Trader and investor risk appetite remains keener at mid-week as global stock markets have generally rebounded from selling pressure that began the month of September.
In focus today, the U.S. Federal Reserve concludes its two-day monetary policy meeting this afternoon with a statement and press conference from Fed Chairman Jay Powell. The Fed’s post-FOMC meeting statement and Powell’s remarks will be closely scrutinized for more clarity on the Fed’s shift to an easing of its inflation guidelines. The Bank of England and Bank of Japan also have monetary policy meetings this week.
In overnight news the OECD think tank projected the global economy to contract by 4.5% in 2020, which is a bit better than its June forecast of 6.0% contraction. The OECD also said the world economy could grow by 7.0% in 2021, provided Covid restrictions are lifted and an effective vaccine is found.
The important outside markets today see the U.S. dollar index lower again. Nymex crude oil prices are higher and trading around $39.25. The yield on the U.S. Treasury 10-year note is trading around 0.68% today.
U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, retail sales, the NAHB housing market index, manufacturing and trade inventories, the weekly DOE liquid energy stocks report and Treasury international capital data.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are firmer in early U.S. trading. Bulls have regained the firm overall near-term technical advantage as the try to restart a price uptrend on the daily bar chart. The shorter-term moving averages (4-, 9- and 18-day) are still bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is below 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 3,436.50 and then at 3,450.00. Buy stops likely reside just above those levels. Downside support for active traders today is seen at the overnight low of 3,385.25 and then at Tuesday’s low of 3,366.25. Wyckoff’s Intra-day Market Rating: 6.0
December Nasdaq index futures: Prices are higher in early U.S. trading. Bulls have the overall technical advantage and are trying to restart a price uptrend on the daily chart. Shorter-term moving averages (4- 9-and 18-day) are still bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at the overnight high of 11,531.75 and then at 11,600.00. On the downside, shorter-term support is seen at the overnight low of 11,388.50 and then at Tuesday’s low of 11,233.00. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are firmer in early U.S. trading. Bulls and bears are on a level overall near-term technical playing field. 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 early today. Shorter-term technical resistance is seen at this week’s high of 177 2/32 and then at 177 16/32. Shorter-term support lies at this week’s low of 176 3/32 and then at 175 16/32. Wyckoff’s Intra-Day Market Rating: 5.5
December U.S. T-Notes: Prices are firmer in early U.S. trading. Bulls have the overall near-term technical advantage. 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 bullish early today. Shorter-term resistance lies at this week’s high of 139.23.0 and then at the September high of 139.29.0. Shorter-term technical support lies at this week’s low of 139.13.5 and then at 139.08.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The December Euro currency futures are higher in early U.S. trading. Bulls have the solid overall near-term technical advantage but trading has turned sideways at higher levels. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are bullish early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.1924 and then at last week’s high of 1.1941. Shorter-term support is seen at the overnight low of 1.1850 and then at 1.1800. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
October Nymex crude oil prices are higher in early U.S. trading. The shorter-term moving averages are still 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 bullish early today. Look for buy stops to reside just above technical resistance at the overnight high of $39.42 and then at $40.00. Look for sell stops just below technical support at the overnight low of $38.35 and then at this week’s low of $36.82. Wyckoff’s Intra-Day Market Rating: 6.5
GRAINS
US grain futures are mixed but mostly firmer in early U.S. pre-market trading. Bulls have the near-term technical advantage in all three markets, but the wheat bulls are fading. Export demand for U.S. corn and soybeans remains strong and is presently trumping very adequate global grain supplies. Early U.S. harvest results will be closely examined.
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%):
- 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