Friday, January 5–Jim Wyckoff’s morning markets report
Traders are looking ahead to Friday morning’s U.S. employment situation report for December. The key non-farm jobs number in the report is expected to come in up 170,000 and compares to a rise of 199,000 seen in the November report. A big miss on the consensus forecast is likely to move the markets.
In overnight news, the Eurozone consumer price index in December came in at up 2.9%, year-on-year, versus up 2.4% in the November report. Eurozone producer prices in November were reported down 8.8% year-on-year.
The key outside markets today see the U.S. dollar index higher, continuing this week’s solid rebound. Nymex crude oil prices are higher and trading around $72.50 a barrel. Prices are still in a downtrend on the daily bar chart. Meantime, the yield on the benchmark U.S. Treasury 10-year note is presently fetching 4.040%.
Other U.S. economic data due out Friday includes the ISM report on business services and manufacturers’ shipments and inventories.
STOCK INDEXES
March S&P 500 e-mini futures: Prices are lower and hit a three-week low in early U.S. trading. Bulls are fading to start 2024. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at Thursday’s high of 4,766.50 and then at 4,800.00. Support for active traders is seen at 4,700.00 and then at 4,675.00. Wyckoff’s Intra-day Market Rating: 4.0
March Nasdaq index futures: Prices are weaker and hit a three-week low 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 and 18-day. The 9-day is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at Thursday’s high of 16,587.25 and then at Wednesday’s high of 16,737.25. On the downside, shorter-term support is seen at 16,300.00 and then at 16,200.00. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are lower and hit a three-week low 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 122 29/32 and then at 124 even. Shorter-term support lies at 121 24/32 and then at 121 even. Wyckoff’s Intra-Day Market Rating: 4.0
March U.S. T-Notes: Prices are lower and hit a three-week low 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 the overnight high of 112.01.0 and then at 112.16.0. Shorter-term technical support is seen at 111.10.0 and then at 111.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The March Euro currency futures are lower in early U.S. trading. Bulls have the overall near-term technical advantage but have faded a bit. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is below the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators for the Euro are bearish early today. The Euro currency finds shorter-term technical resistance at Thursday’s high of 1.1004 and then at this week’s high of 1.1078. Shorter-term support is seen at this week’s low of 1.0926 and then at 1.0900. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
February Nymex crude oil prices are modestly higher in early U.S. trading. The shorter-term moving averages are neutral early today as the 4-day is below 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 this week’s high of $74.00 and then at $75.00. Look for sell stops just below technical support at Thursday’s low of $71.06 and then at $70.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures prices were mixed to weaker overnight. On tap today is the weekly USDA export sales report. Keener risk aversion in the marketplace this week has the grain market bulls timid. Charts are fully bearish for corn and wheat. Technicals are also bearish for soybeans, meal and soybean oil. All the grain markets are trending down on the daily bar charts. That means their path of least resistance remains sideways to lower.
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