Monday, September 11–Jim Wyckoff’s morning markets report
Asian and European stock markets were mixed overnight. U.S. stock indexes are pointed to higher openings when the New York day session begins. Traders and investors are waiting for the next major U.S. data point, which will likely be the consumer price index report for August, out Wednesday. The CPI is expected to be up 4.3%, year-on-year, versus a 4.7% rise in the July report. The European Central Bank also holds its regular monetary policy meeting this week and is expected to slightly raise its main interest rate by 0.25%.
In overnight news, a Wall Street Journal headline reads, “An important shift in Fed officials’ stance is under way.” In the article, reporter Nick Timiraos, who is said to have close ties with the Fed, writes that Fed officials, including Chairman Jay Powell, now have a more balanced approach on monetary policy. That’s a dovish shift from the more hawkish approach the Fed had in recent months, which was one of erring on the side of raising interest rates too high, to make certain inflation is choked off. Now, the Fed is more worried about further interest rate increases causing an unnecessary U.S. recession.
The key outside markets today see the U.S. dollar index lower. Nymex crude oil prices are weaker and trading around $87.00 a barrel. The benchmark U.S. Treasury 10-year note yield is presently fetching 4.294%.
There is no major U.S. economic data due for release Monday.
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are firmer 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 below 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 4,553.25 and then at the September high of 4,597.50. Support for active traders is seen at last week’s low of 4,483.25 and then at 4,450.00. Wyckoff’s Intra-day Market Rating: 5.5
December Nasdaq index futures: Prices are higher in early U.S. trading. 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 15,700.00 and then at 15,800.00. On the downside, shorter-term support is seen at the overnight low of 15,492.75 and then at last week’s low of 15,352.00. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
December U.S. T-Bonds: Prices are lower 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 and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at the overnight high of 119 17/32 and then at last week’s high of 120 8/32. Shorter-term support lies at last week’s low of 118 25/32 and then at 118 even. Wyckoff’s Intra-Day Market Rating: 4.0
December U.S. T-Notes: Prices are lower 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 and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at 110.00.0 and then at last week’s high of 110.17.0. Shorter-term technical support is seen at last week’s low of 109.19.0 and then at 109.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The December Euro currency futures are up in early U.S. trading. Prices are still trending lower and bears are in solid control. The shorter-term moving averages for the Euro are bearish early today, as the 4-day is below the 9-day. The 9-day is below 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 1.0801 and then at last week’s high of 1.0863. Shorter-term support is seen at the September low of 1.0747 and then at 1.0700. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
October Nymex crude oil prices are slightly down in early U.S. trading. The shorter-term moving averages are bullish early today as the 4-day is above the 9-day and 18-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 the September high of $88.08 and then at $89.00. Look for sell stops just below technical support at $86.00 and then at $85.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Grain futures prices were mixed in overnight trading. On tap today is the weekly USDA export inspections report. Traders await Tuesday’s USDA monthly supply and demand report, which will provide fresh production estimates. Technicals are overall bearish for corn and wheat, and bullish for soybeans.
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