Tuesday, January 9–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mostly firmer in overnight dealings. U.S. stock indexes are pointed toward firmer openings when the New York day session begins. The U.S. indexes poked to new record highs again overnight. There continues to be little risk aversion in the world marketplace, at present.
In overnight news, the Euro zone’s unemployment rate dropped to 8.7% in November, which is the lowest level in nine years.
The key outside markets on Tuesday morning see the U.S. dollar index higher on another corrective bounce from recent selling pressure. While the greenback bears still have the overall near-term technical advantage, the bulls are out of the shoot in good fashion so far this week.
Meantime, Nymex crude oil prices are firmer and hit a three-year high of $62.56 a barrel overnight. Traders are waiting to see if the U.S. implements new economic sanctions against Iran, which could limit their oil exports.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and Goldman Sachs retail sales reports, the NFIB small business index, the IDB/TIPP economic optimism index, and the World Bank’s global economic prospects report.
–Jim
U.S. STOCK INDEXES
March S&P 500 December e-mini futures: Prices are slightly up and hit another contract and record high overnight. Bulls have the solid overall near-term technical advantage. However, the market is now short-term overbought and due for a decent downside correction very soon. The shorter-term moving averages (4-, 9- 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 to bullish early today. Today, shorter-term technical resistance comes in at the contract and record high of 2,749.00 and then at 2,765.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at Monday’s low of 2,736.50 and then at last Friday’s low of 2,723.75. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5
March Nasdaq index December futures: Prices are firmer in early U.S. trading and hit another contract and record high overnight. The bulls have the solid overall near-term technical advantage. However, the market is now short-term overbought and due for a decent downside correction very soon. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at the contract high of 6,699.00 and then at 6,725.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at Monday’s low of 6,653.25 and then at 6,625.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES
March U.S. T-Bonds: Prices are lower in early U.S. trading. Bears have the overall near-term technical advantage. 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 151 26/32 and then at 152 even. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 151 7/32 and then at 151 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
March U.S. T-Notes: Prices are weaker and hit a new contract low in early U.S. trading. Bears have the solid overall near-term technical advantage. 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 bearish early today. Shorter-term resistance lies at Monday’s high of 123.20.0 and then at 123.24.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight contract low of 123.09.5 and then at 123.04.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
U.S. DOLLAR INDEX
The March U.S. dollar index is higher in early U.S. trading, on more short-covering from recent selling pressure. Bears still have the overall near-term technical advantage. The shorter-term moving averages for the dollar index are bearish 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 for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at 92.50 and then at 92.690. Shorter-term support is seen at the overnight low of 91.960 and then at Monday’s low of 91.610. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
February Nymex crude oil prices are firmer in early U.S. trading and hit a three-year high. Bulls have the solid overall near-term technical advantage. Look for buy stops to reside just above technical resistance at the overnight high of $62.56 and then at 63.00. Look for sell stops just below technical support at $61.00 and then at $60.00. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
Grain futures were mixed overnight. Grain market bears remain in firm overall near-term technical control. Traders are looking ahead to Friday’s USDA supply and demand report.