Monday, September 27–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed but mostly firmer in overnight trading. The U.S. stock indexes are also pointed to mixed openings when the New York day session begins. Focus this week is on U.S. government spending. President Biden’s infrastructure package is set for a House of Representatives vote on Thursday, while the U.S. government’s funding will expire at midnight Thursday, which if not extended, would shut down part of the government Friday.
In other news, European countries and China are experiencing energy shortages that are not expected to be resolved anytime soon. That suggests crude oil and natural gas prices will remain elevated for some time to come. That’s a bullish underlying element for much of the raw commodity sector.
The key outside markets today see the U.S. dollar index slightly firmer. Nymex crude oil futures prices are higher and trading around $75.00 a barrel The 10-year U.S. Treasury note yield is presently fetching 1.446%. For perspective, the German 10-year bund is trading at minus 0.238% and the U.K. 10-year gilt at 0.831%.
U.S. economic data due for release Monday includes durable goods orders and the Texas manufacturing outlook survey.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are near steady in early U.S. trading. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below 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 overnight high of 4,472.00 and then at 4,500.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at Friday’s low of 4,410.75 and then at 4,385.75. Sell stops likely reside below those levels. Wyckoff’s Intra-day Market Rating: 5.0
December Nasdaq index futures: Prices are lower in early U.S. trading. Bulls have the overall chart advantage. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is even with the 9-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 the overnight high of 15,399.25 and then at 15,500.00. Buy stops likely reside just above those levels. On the downside, shorter-term support is seen at 15,176.75 and then at 15,000.00. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are lower and hit a 2.5.-month low in early U.S. trading. Prices have also seen a bearish downside “breakout” from a trading range at higher levels. 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 161 8/32 and then at 162 even. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 160 9/32 and then at 160 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
December U.S. T-Notes: Prices are lower and hit a 2.5-month low 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 bearish early today. Shorter-term resistance lies at 132.00.0 and then at the overnight high of 132.05.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 131.23.0 and then at 131.18.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The December Euro currency futures are slightly lower and hit a five-week low in early U.S. trading. Bears have the solid overall near-term technical advantage. The shorter-term moving averages for the Euro 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 for the Euro are neutral to bearish early today. The Euro currency finds shorter-term technical resistance at last week’s high of 1.1775 and then at 1.1800. Buy stops likely reside just above those levels. Shorter-term support is seen at the August low of 1.1690 and then at 1.1650. Sell stops likely reside just below those levels. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
Nymex crude oil prices are higher and hit a 2.5-month high overnight. Bulls are in solid technical control. The shorter-term moving averages 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 (RSI and slow stochastics) are bullish early today. Look for buy stops to reside just above technical resistance at the overnight high of $75.33 and then at $76.00. Look for sell stops just below technical support at the overnight low of $74.16 and then at $73.00. Wyckoff’s Intra-Day Market Rating: 6.5
GRAINS
U.S. grain futures were mixed overnight. Look for the grains to continue to be more impacted by outside market forces—namely global stock markets–for the near term. The corn and soybean market bears still have the near-term technical advantage, while the wheat bulls are showing resilience and have the slight near-term technical advantage. On tap today is the weekly USDA export inspections report.
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