Friday, February 16–Jim Wyckoff’s morning markets report
Asian and European stock markets were mixed in overnight trading. U.S. stock index futures are set to open firmer when the New York day session begins.
Traders are awaiting Friday morning’s U.S. producer price index report for January, seen coming in at up 0.1% from December, compared to a 0.1% month-on-month decline in the December PPI report.
Here’s a startling headline from the Wall Street Journal today: “The U.S. government will soon spend more on interest payments than defense.”
Other U.S. economic data due for release Friday includes new residential construction and the University of Michigan consumer survey.
STOCK INDEXES
March S&P 500 e-mini futures: Prices are firmer in early U.S. trading and near this week’s record high. Bulls have the solid overall near-term technical advantage. Prices are in a three-month-old uptrend 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. The 9-day is above 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 record high of 5,066.50 and then at 5,100.00. Support for active traders is seen at Thursday’s low of 5,011.00 and then at 5,000.00. Wyckoff’s Intra-day Market Rating: 6.0
March Nasdaq index futures: Prices are firmer in early U.S. trading and not far below this week’s record high. Bulls have the solid overall near-term technical 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 is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at the contract high of 18,121.50 and then at 18,250.00. On the downside, shorter-term support is seen at Thursday’s low of 17,780.50 and then at Wednesday’s low of 17,669.25. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are weaker 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 and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at Thursday’s high of 119 20/32 and then at 120 even. Shorter-term support lies at this week’s low of 117 26/32 and then at 117 even. Wyckoff’s Intra-Day Market Rating: 4.5
March U.S. T-Notes: Prices are lower 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 and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at the overnight high of 110.07.5 and then at Thursday’s high of 110.17.5. Shorter-term technical support is seen at the overnight low of 109.28.0 and then at this week’s low of 109.16.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The March Euro currency futures are slightly up in early U.S. trading. Bears have the near-term technical advantage. Prices are trending down on the daily bar chart. 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 bullish early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.0830 and then at 1.0900. Shorter-term support is seen at this week’s low of 1.0709 and then at 1.0650. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
March Nymex crude oil prices are weaker in early U.S. trading. 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 neutral early today. Look for buy stops to reside just above technical resistance at this week’s high of $78.77 and then at the January high of $79.29. Look for sell stops just below technical support at $76.00 and then at $75.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Grain futures prices were mixed overnight. On tap today the annual USDA Ag Outlook conference. Charts are still fully bearish for corn, wheat, soybeans, meal and bean oil. All the grain markets are trending down on the daily bar charts. Seasonality factors are turning a bit more bullish for the grain markets as springtime approaches. But still, there are no solid, early technical clues to suggest the grain markets have put in price bottoms.
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