Monday, July 23–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mixed to mostly lower overnight. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins. The world stock markets showed a mildly bearish reaction to President Trump’s tweet late Sunday warning Iran not to threaten the U.S. or that country would suffer grave consequences.
A Group of 20 finance ministers meeting held during the weekend resulted in little markets-moving results. U.S. Treasury Secretary Mnuchin said the U.S. could indeed follow through with $500 billion in new trade sanctions against China.
The key “outside markets” today find Nymex crude oil prices modestly higher and trading just below $69.00 a barrel. Meantime, the U.S. dollar index is slightly higher early today.
U.S. economic data due for release Monday includes the Chicago Fed national activity index and existing home sales.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are slightly lower in early U.S. trading, on profit taking after hitting a five-month high last week. The bulls still have the firm overall near-term technical advantage. 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 bearish early today. Today, shorter-term technical resistance comes in at last week’s high of 2,818.25 and then at 2,840.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at last week’s low of 2,789.75 and then at 2,773.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5
September Nasdaq index December futures: Prices are weaker early today. Bulls have the firm 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 and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at the overnight high of 7,377.50 and then at 7,400.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at last week’s low of 7,292.50 and then at 7,250.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES
September U.S. T-Bonds: Prices are slightly higher in early U.S. trading after hitting a nearly four-week low overnight. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at 144 16/32 and then at 145 even. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 144 1/32 and then at 143 16/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
September U.S. T-Notes: Prices are firmer 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 early today. Shorter-term resistance lies at 120.08.0 and then at last week’s high of 120.13.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 119.30.0 and then at last week’s low of 119.27.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
U.S. DOLLAR INDEX
The September U.S. dollar index is slightly higher in early U.S. trading. Bulls still have the firm overall near-term technical advantage. The shorter-term moving averages for the dollar index 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 dollar index are neutral to bearish early today. The dollar index finds shorter-term technical resistance at 94.500 and then at 95.000. Shorter-term support is seen at the overnight low of 93.970 and then at 93.500. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
September Nymex crude oil prices are higher in early U.S. trading. Bulls have regained some momentum after the recent sell off. The shorter-term moving averages are still bearish early today 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 (RSI and slow stochastics) are neutral to bullish early today. Look for buy stops to reside just above technical resistance at $70.00 and then at $71.00. Look for sell stops just below technical support at $68.00 and then at $67.50. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
Grain futures prices were steady to firmer overnight. Corn and soybean markets are now showing early technical clues that market bottoms are finally in place, following their bullish weekly high closes on Friday. The wheat market has also turned more bullish just recently.
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