Tuesday, April 3–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were lower overnight, following the sharp losses seen in the U.S. stock market on Monday that saw the indexes hit seven-week lows. U.S. stock indexes are pointed toward firmer openings, on corrective bounces, when the New York day session begins.
Fears of a global trade war have been stoked further by China’s retaliatory actions after the U.S. recently slapped the world’s second-largest economy with trade sanctions. While the U.S. and China have begun negotiations to resolve their trade dispute, the world marketplace is nonetheless rattled by the matter.
Gold prices, U.S. Treasury bonds and notes, and the U.S dollar index rallied Monday, on safe-haven demand.
The key “outside markets” on Tuesday morning see the U.S. dollar index slightly lower. Meantime, Nymex crude oil prices are firmer and trading just above $63.00 a barrel.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and Goldman Sachs retail sales reports, the ISM New York report on business, the IBD/TIPP economic optimism index, the global manufacturing PMI and domestic auto industry sales.
–Jim
U.S. STOCK INDEXES
June S&P 500 December e-mini futures: Prices are firmer in early U.S. trading, on a minor rebound following Monday’s big losses. 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 neutral early today. Today, shorter-term technical resistance comes in at 2,600.00 and then at 2,625.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at Monday’s low of 2,552.00 and then at the February low of 2,532.50. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5
June Nasdaq index December futures: Prices are higher in early U.S. trading, on a corrective bounce from solid losses Monday. 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 average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 6,450.00 and 6,500.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 6,394.25 and then at Monday’s low of 6,326.50. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES
June U.S. T-Bonds: Prices are weaker in early U.S. trading, on a corrective bounce after hitting a two-month high on Monday. 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 146 28/32 and then at Monday’s high of 147 3/32. Buy stops likely reside just above those levels. Shorter-term support lies at Monday’s low of 145 31/32 and then at 145 19/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
June U.S. T-Notes: Prices are weaker in early U.S. trading, on a corrective pullback after hitting a two-month high mon Monday. Bulls have upside momentum. 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 bearish early today. Shorter-term resistance lies at the overnight high of 121.08.5 and then at Monday’s high of 121.12.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at Monday’s low of 120.29.5 and then at 120.25.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
U.S. DOLLAR INDEX
The June U.S. dollar index is slightly lower in early U.S. trading. The shorter-term moving averages for the dollar index are neutral 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 dollar index are neutral early today. The dollar index finds shorter-term technical resistance at last week’s high of 89.840 and then at 90.025. Shorter-term support is seen at Monday’s low of 89.415 and then at 89.250. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
May Nymex crude oil prices are firmer in early U.S. trading. Bulls still have the overall near-term technical advantage but have faded a bit. Look for buy stops to reside just above technical resistance at $64.00 and then at $65.00. Look for sell stops just below technical support at Monday’s low of $62.80 and then at $62.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures were higher overnight. Grain market bulls have regained upside momentum recently. A generally bullish USDA report last week is being offset, somewhat, by fears of a U.S.-China trade war.