Friday, February 3–Jim Wyckoff’s morning markets report
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward lower openings when the New York day session begins, on profit taking after recent strong gains that saw index prices hit multi-month highs on Thursday.
Traders are awaiting Friday morning’s January U.S. employment situation report from the Labor Department. The key non-farm payrolls number is expected to be up 187,000 jobs, following a rise of 223,000 in the December report. A significant miss from expectations is likely to move many markets.
In overnight news, the Euro zone January producer price index was reported up 24.6%, year-on-year, but excluding energy was up 12.3%.
The key outside markets today see the U.S. dollar index weaker. Prices Thursday hit a nine-month low. Nymex crude oil futures prices are a bit weaker and trading around $76.75 a barrel. Meantime, the yield on the benchmark U.S. 10-year Treasury note is presently fetching 3.392%.
Other U.S. economic data due for release Friday includes the U.S. services purchasing managers’ index (PMI), the global services PMI and the ISM report on business services.
–Jim
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are weaker in early U.S. trading, on a corrective pullback after prices Thursday hit a 5.5-month high. 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 early today. Today, shorter-term technical resistance comes in at this week’s high of 4,208.50 and then at 4,250.00. Support for active traders is seen at Thursday’s low of 4,136.75 and then at Wednesday’s low of 4,048.50. Wyckoff’s Intra-day Market Rating: 4.5
March Nasdaq index futures: Prices are lower in early U.S. trading, on profit taking after hitting a 4.5-month high on Thursday. Prices are in a four-week-old uptrend on the daily bar chart. 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 early today. Shorter-term technical resistance is seen at 12,750.00 and then at 13,000.00. On the downside, shorter-term support is seen at 12,500.00 and then at 12,300.00. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are near steady in early U.S. trading. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at this week’s high of 132 22/32 and then at the January high of 132 31/32. Shorter-term support lies at 131 even and then at 130 even. Wyckoff’s Intra-Day Market Rating: 5.0
March U.S. T-Notes: 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 above the 9-day. The 9-day is even with the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term resistance lies at this week’s high of 116.00.0 and then at the January high of 116.08.0. Shorter-term technical support lies at 115.08.0 and then at 115.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
EURO CURRENCY
The March Euro currency futures are firmer in early U.S. trading. Bulls have the solid overall near-term technical advantage. Prices Thursday hit a nine-month high and remain in an uptrend on the daily bar chart. The shorter-term moving averages for the Euro 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 for the Euro are neutral early today. The Euro currency finds shorter-term technical resistance at 1.1000 and then at this week’s high of 1.1059. Shorter-term support is seen at 1.0900 and then at this week’s low of 1.0830. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
March Nymex crude oil prices are near steady 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 and 18-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 $78.00 and then at $80.00. Look for sell stops just below technical support at $75.00 and then at $74.00. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Prices were mixed overnight. The upbeat trader and investor attitudes late this week are friendly for grain futures markets. Corn and soybean market bulls have the overall near-term technical advantage. Wheat futures bears have the overall chart advantage but there are early technical clues the wheat markets have bottomed out. Traders will focus on the key outside markets for direction in the grains today: The U.S. dollar index, crude oil and the U.S. stock indexes.
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