Tuesday, January 2–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mixed but mostly higher overnight, on the first trading day of the new year. U.S. stock indexes are pointed toward firmer openings when the New York day session begins. Markets in Japan were closed today.
A feature in the marketplace early this week are rising tensions in Iran as demonstrators in that country are demanding an overthrow of the ruling government. There has been a violent crackdown on the demonstrators by the Iranian government. U.S. President Donald Trump has tweeted that he supports the demonstrators, which is a dramatic shift from the Obama administration that was much more low key on such matters.
Gold prices are higher and hit a three-month high well above the $1,300.00 level today, amid the recent downturn in the U.S. dollar and the tensions in Iran.
The key outside markets on Tuesday morning find the U.S. dollar index again lower and hitting a more-than-three-month low overnight. Nymex crude oil prices slightly lower on the day after hitting a 2.5-year high above $60.00 a barrel overnight. A supply disruption in the North Sea and the Iran demonstrations are supporting the oil market.
U.S. economic data due for release Tuesday includes the U.S. and global manufacturing purchasing managers indexes.
–Jim
U.S. STOCK INDEXES
March S&P 500 December e-mini futures: Prices are firmer and not far below the late-December contract and record high. Bulls still have the solid overall near-term technical advantage. There are still no strong, early chart clues to suggest a market top is close at hand. 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 early today. Today, shorter-term technical resistance comes in at 2,690.00 and then at the contract high of 2,698.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at last week’s low of 2,667.75 and then at 2,650.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5
March Nasdaq index December futures: Prices are slightly higher in early U.S. trading. The bulls still have the overall near-term technical advantage. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-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 last Friday’s high of 6,467.75 and then at 6,485.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at last week’s low of 6,383.25 and then at 6,360.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES
March U.S. T-Bonds: Prices are lower 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 below 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 152 29/32 and then at 153 4/32. Buy stops likely reside just above those levels. Shorter-term support lies at 152 even and then at 151 16/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
March U.S. T-Notes: Prices are lower in early U.S. trading. Bears have the solid overall near-term technical advantage. 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 below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at last Friday’s high of 124.02.5 and then at 124.08.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at 123.24.0 and then at 123.20.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
U.S. DOLLAR INDEX
The March U.S. dollar index is lower and hit a 3/5-month low overnight. Bears have downside technical momentum to suggest more pressure in the near term. The shorter-term moving averages for the dollar index are bearish as the 4-day is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 91.930 and then at 92.375. Shorter-term support is seen at the overnight low of 91.270 and then at 91.250. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
February Nymex crude oil prices are near steady in early U.S. trading and hit a 2.5-year high overnight. Bulls have the solid overall near-term technical advantage. Look for buy stops to reside just above technical resistance at the overnight high of $60.74 and then at 61.00. Look for sell stops just below technical support at $60.00 and then at $59.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures did not trade overnight. Grain market bears remain in technical control. However, the corn and wheat markets are showing some very early signs that market bottoms are in place.