Friday, September 17–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed in overnight trading, with European indexes mostly weaker and Asian indexes mostly firmer. The U.S. stock indexes are pointed to modestly lower openings when the New York day session begins. It’s been a choppy trading week for the U.S. stock indexes, and such may continue to be the case until mid-week next week, when the Federal Reserve’s Open Market Committee (FOMC) concludes its monetary policy meeting.
The big Chinese property developer Evergrande saw its stock price plunge again overnight, which some are taking as a sign there are bigger underlying problems with China’s economy. China’s central bank injected liquidity into its financial system Friday—the first such action in seven months. The move was aimed at calming jittery Chinese markets.
In other overnight news, the Euro zone consumer price index for August was reported at up 0.4% from July and up 3.0%, year-on-year. Those numbers were right in line with market expectations and tame on the inflation front.
The key outside markets today see the U.S. dollar index weaker. Nymex crude oil futures prices are also lower and trading around $72.15 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently fetching 1.338%.
U.S. economic data due for release Friday is light and includes the University of Michigan consumer sentiment survey.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are slightly lower in early U.S. trading. Bulls still have the firm overall near-term technical advantage. Prices are still in a longer-term uptrend on the charts. The shorter-term moving averages (4-, 9- and 18-day) are 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 bearish early today. Today, shorter-term technical resistance comes in at this week’s high of 4,483.50 and then at 4,500.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at this week’s low of 4,425.25 and then at 4,400.00. Sell stops likely reside below those levels. Wyckoff’s Intra-day Market Rating: 4.5
December Nasdaq index futures: Prices are slightly lower in early U.S. trading. Bulls have the solid chart 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 bearish early today. Shorter-term technical resistance is seen at this week’s high of 15,557.50 and then at the contract high of 15,702.25. Buy stops likely reside just above those levels. On the downside, shorter-term support is seen at this week’s low of 15,307.75 and then at 15,200.00. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are slightly down in early U.S. trading. Bulls 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 even with the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 164 even and then at this week’s high of 164 24/32. Buy stops likely reside just above those levels. Shorter-term support lies at Thursday’s low of 162 31/32 and then at this week’s low of 162 18/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
December U.S. T-Notes: Prices are near steady 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 below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term resistance lies at Thursday’s high of 133.14.5 and then at this week’s high of 133.23.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at this week’s low of 132.30.0 and then at 132.25.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
EURO CURRENCY
The December Euro currency futures are higher in early U.S. trading. Bears still have the solid overall near-term technical advantage. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is below the 9-day and 18-day. The 9-day is even with the 18-day moving average. Short-term oscillators for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at Thursday’s high of 1.1841 and then at this week’s high of 1.1867. Buy stops likely reside just above those levels. Shorter-term support is seen at this week’s low of 1.1770 and then at 1.1750. Sell stops likely reside just below those levels. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
Nymex crude oil prices are slightly lower in early U.S. trading on a mild pullback after hitting a six-week high on Wednesday. The shorter-term moving averages 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 (RSI and slow stochastics) are neutral to bearish early today. Look for buy stops to reside just above technical resistance at this week’s high of $73.14 and then at $73.52. Look for sell stops just below technical support at $72.00 and then at $71.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
U.S. grain futures were mixed to weaker overnight. Bulls are having a fairly good week, overall and have at least stabilized prices after the recent sell offs. More gains in the near term would suggest that “harvest lows” have come early this year.
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