Tuesday, March 12–Jim Wyckoff’s morning markets report
Asian and European stock markets were mixed in overnight trading. U.S. stock index futures are set to open mixed when the New York day session begins.
The U.S. data point of the week comes on out today: the consumer price index report for February, seen coming in at up 3.7%, year-on-year, versus a rise of 3.9% seen in the January report. A warm or hot reading, which would be above 3.7%, could derail the U.S. stock market rally, as well as gold’s surge and U.S. Treasury yields’ recent declines. JP Morgan chief Jamie Dimon said overnight the Federal Reserve should wait until after June to lower interest rates. Dimon, visiting Australia, also told a group that the U.S. stock market could be in a bubble phase, adding to be extra cautious when an investment looks so obvious.
Other U.S. economic data due for release Tuesday includes the weekly Johnson Redbook retail sales report, the NFIB small business index and the monthly Treasury budget statement.
STOCK INDEXES
June S&P 500 e-mini futures: Prices are a bit firmer in early U.S. trading and are not far below last Friday’s contract and record high. Bulls have the solid overall near-term technical advantage. Prices are in a 4.5-month-old uptrend on the daily bar chart. The shorter-term moving averages (4-day, 9-day and 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. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at the contract high of 5,257.25 and then at 5,275.00. Support for active traders is seen at this week’s low of 5,157.00 and then at last week’s low of 5,124.25. Wyckoff’s Intra-day Market Rating: 5.5
June Nasdaq index futures: Prices are firmer in early U.S. trading and not far below last Friday’s contract high. Bulls have the solid 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. The 9-day is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 18,400.00 and then at 18,500.00. On the downside, shorter-term support is seen at 18,200.00 and then at last week’s low of 18,075.00. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are firmer in early U.S. trading. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at last week’s high of 122 13/32 and then at 123 even. Shorter-term support lies at last Friday’s low of 121 2/32 and then at 120 9/32. Wyckoff’s Intra-Day Market Rating: 5.5
June U.S. T-Notes: Prices are slightly up in early U.S. trading. 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 112.00.0 and then at last week’s high of 112.04.5. Shorter-term technical support is seen at last Friday’s low of 111.08.0 and then at 111.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The June Euro currency futures are slightly up in early U.S. trading. The shorter-term moving averages for the Euro 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 for the Euro are neutral to bullish early today. The Euro currency finds shorter-term technical resistance at last week’s high of 1.1026 and then at 1.1100. Shorter-term support is seen at 1.0950 and then at 1.0900. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
April Nymex crude oil prices are firmer in early U.S. trading. The shorter-term moving averages are neutral early today as the 4-day is below the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral early today. Look for buy stops to reside just above technical resistance at $80.00 and then at the March high of $80.85. Look for sell stops just below technical support at this week’s low of $76.79 and then at $75.84. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures prices were lower overnight. Charts remain overall bearish for corn, wheat, soybeans, meal and bean oil. However, corn, soybeans and HRW wheat have broken their near-term price downtrends on the daily charts, to suggest market bottoms are in place. “Corn is king” in the grains, and if corn has bottomed out, so likely have the other grains.
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