Wednesday, August 10–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly down overnight. U.S. stock indexes are pointed toward slightly higher openings when the New York day session beings. Traders are awaiting this week’s two key U.S. inflation reports, starting with today’s consumer price index report for July, which is seen coming in up 8.7%, year-on-year, after a rise of 9.1% in the June report. Thursday comes the producer price index report for July, seen up 0.2% from June and compares to the June report’s rise of 1.1% from May.
In overnight news, China said it has stopped its military exercise around Taiwan, but now says it’s preparing for war. On the economic front, China said its consumer price inflation in July was up 2.7%, year-on-year, which is the highest rate in two years.
The key outside markets today see Nymex crude oil prices down and trading around $89.00 a barrel. The U.S. dollar index is a bit lower again in early U.S. trading. The yield on the 10-year U.S. Treasury note is fetching 2.793%.
Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, real earnings, monthly wholesale trade, the monthly Treasury budget statement and the weekly DOE liquid energy stocks report.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are slightly up in early U.S. trading. Bulls have the overall near-term technical advantage amid a price uptrend in place on the daily bar chart. The 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 is above 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 this week’s high of 4,188.88 and then at 4,204.75. Support for active traders is seen at 4,080.50 and then at 4,050.00. Wyckoff’s Intra-day Market Rating: 5.5
September Nasdaq index futures: Prices are slightly up in early U.S. trading. Prices are trending higher on the daily bar chart and bulls have the overall near-term technical advantage. 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 bearish early today. Shorter-term technical resistance is seen at Tuesday’s high of 12,233.75 and then at this week’s high of 12,419.25. On the downside, shorter-term support is seen at this week’s low of 12,963.25 and then at the August low of 12,814.75. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are near steady 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 142 30/32 and then at 144 even. Shorter-term support lies at this week’s low of 141 even and then at last week’s low of 140 19/32. Wyckoff’s Intra-Day Market Rating: 5.0
September U.S. T-Notes: Prices are near steady in early U.S. trading. Bulls have the overall near-term technical advantage. 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 bearish early today. Shorter-term resistance lies at this week’s high of 120.00.5 and then at 120.16.0. Shorter-term technical support lies at last week’s low of 119.07.5 and then at 119.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
EURO CURRENCY
The September Euro currency futures are higher in early U.S. trading. Bears still have the firm overall near-term technical advantage. However, trading has been sideways and choppy for three weeks. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is even with the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators for the Euro are bullish early today. The Euro currency finds shorter-term technical resistance at 1.0327 and then at 1.0400. Shorter-term support is seen at last week’s low of 1.0154 and then at 1.0100. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
Nymex crude oil prices are lower in early U.S. trading. Bears have the overall near-term technical advantage. The shorter-term moving averages 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 (RSI and slow stochastics) are bearish early today. Look for buy stops to reside just above technical resistance at $91.00 and then at this week’s high of $92.65. Look for sell stops just below technical support at the August low of $87.01 and then at $85.00. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
U.S. grain futures were firmer overnight. Lower USDA weekly crop condition ratings have lifted the grains this week. Still, time is running short for a significant weather market scare to develop this summer. Traders are awaiting Friday morning’s monthly USDA supply and demand report and trading may be quieter leading up to the 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