Tuesday, May 9–Jim Wyckoff’s morning markets report
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins. Trading has turned choppy and sideways in the stock indexes.
President Biden today meets with House Speaker Kevin McCarthy and other congressional leaders to discuss raising or suspending the U.S. debt ceiling. U.S. Treasury Secretary Janet Yellen told lawmakers last week the U.S. could default on its debt as early as June 1 if Congress does not raise or suspend the debt limit before that time. No progress at today’s meeting would likely cause at least a bit of marketplace anxiety.
The U.S. data point of the week is Wednesday morning’s April consumer price index report, which is expected to come in at up 5.0%, year-on-year, which would be the same as reported in the March CPI. The April core CPI is forecast up 5.5% versus up 5.6% in the March report. A Federal Reserve banking lender survey released Monday showed bankers have curtailed loans to customers, which is likely to help tame inflation.
In other news Bitcoin prices are tumbling on reported blockchain network congestion that caused Binance, the world’s largest crypto exchange, to temporarily halt withdrawals.
Reports said China’s imports dropped 7.9% in April, which is a much larger decline than expected. China’s exports rose 8.5%–a bit stronger than forecasters expected.
The key outside markets today see the U.S. dollar index slightly higher. Nymex crude oil prices are weaker and trading around $72.50 a barrel. Meantime, the benchmark 10-year U.S. Treasury note yield is presently fetching 3.488%.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and retail chain store sales reports, the NFIB small business optimism index and the IBD/TIPP economic optimism index.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are slightly lower in early U.S. trading. 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 to bearish early today. Today, shorter-term technical resistance comes in at last week’s high of 4,206.25 and then at the February high of 4.244.00. Support for active traders is seen at 4,100.00 and then at last week’s low of 4,062.25. Wyckoff’s Intra-day Market Rating: 4.5
June Nasdaq index futures: Prices are slightly lower in early U.S. trading. 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 early today. Shorter-term technical resistance is seen at last week’s high of 13,370.25 and then at 13,500.00. On the downside, shorter-term support is seen at 13,150.00 and then at 13,000.00. Wyckoff’s Intra-Day Market Rating: 5.0.
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 neutral early today. The 4-day moving average is below the 9-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 this week’s high of 131 13/32 and then at 132 even. Shorter-term support lies at Monday’s low of 129 26/32 and then at the May low of 129 3/32. Wyckoff’s Intra-Day Market Rating: 5.5
June U.S. T-Notes: 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. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at Monday’s high of 115.27.5 and then at 116.00.0. Shorter-term technical support is seen at Monday’s low of 115.05.0 and then at 115.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
EURO CURRENCY
The June Euro currency futures are weaker in early U.S. trading. Bulls 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. The 9-day is above the 18-day moving average. Short-term oscillators for the Euro are neutral to bearish early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.1080 and then at the April high of 1.1129. Shorter-term support is seen at last week’s low of 1.0972 and then at 1.0900. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
June Nymex crude oil prices are weaker in early U.S. trading. A bullish V-bottom reversal pattern has formed on the daily bar chart. The shorter-term moving averages are 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 early today. Look for buy stops to reside just above technical resistance at this week’s high of $73.69 and then at $75.00. Look for sell stops just below technical support at Monday’s low of $71.04 and then at $70.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Grain futures prices were weaker overnight. Less risk aversion in the general marketplace this week is friendlier for the grains. The technical postures for soybeans and corn futures have improved a bit lately. HRW wheat has turned slightly bullish. However, SRW wheat and soybean meal and bean oil futures remain firmly bearish.
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