Monday, February 7–Jim Wyckoff’s Morning Markets Report
Global stock markets were mixed overnight. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins. Focus remains in corporate earnings reports being released, which have been generally upbeat. Friday’s surprisingly strong U.S. jobs report also has traders and investors focusing more keenly on Federal Reserve policy, with some market watchers now thinking the Fed will hike its key Fed funds rate by 0.5% in March.
The key outside markets today see crude oil prices lower and trading around $91.50 a barrel after prices Friday hit a seven-year high. Oil traders are eyeing $100-a-barrel crude in the not-too-distant future. The U.S. dollar index is near steady early today. The U.S. Treasury 10-year note yield is presently fetching 1.925%.
U.S. economic data due for release Monday includes the employment trends index and consumer credit.
–Jim
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are slightly weaker in early U.S. trading, on a corrective pullback from last week’s good gains. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at Friday’s high of 4,532.50 and then at last week’s high of 4,586.00. Support for active traders is seen at Friday’s low of 4,438.50 and then at last week’s low of 4,395.50. Wyckoff’s Intra-day Market Rating: 4.5
March Nasdaq index futures: Prices are near steady in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at Friday’s high of 14,825.75 and then at 15,000.00. On the downside, shorter-term support is seen at 14,500.00 and then at last week’s low of 14,353.25. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are a bit firmer in early U.S. trading after hitting a contract low last Friday. Bears have the solid overall near-term technical advantage. 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 152 30/32 and then at 154 16/32. Shorter-term support lies at the contract low of 153 2/32 and then at 152 16/32. Wyckoff’s Intra-Day Market Rating: 5.5
March U.S. T-Notes: Prices are slightly up in early U.S. trading and did hit a contract low overnight. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 127.01.0 and then at 127.08.0. Shorter-term technical support lies at the overnight contract low of 126.22.5 and then at 126.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
EURO CURRENCY
The March Euro currency futures are near steady in early U.S. trading. Bears still have the overall near-term technical advantage. However, the bulls have made a good rebound recently to suggest a market bottom is in place. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is above the 9-day and 18-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 the January high of 1.1495 and then at 1.1550. Shorter-term support is seen at the overnight low of 1.1423 and then at 1.1400. Wyckoff’s Intra Day Market Rating: 5.0
NYMEX CRUDE OIL
March Nymex crude oil prices are weaker in early U.S. trading. Bulls still have the strong overall near-term technical advantage amid a nine-week-old price uptrend in place on the daily chart. 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 to bearish early today. Look for buy stops to reside just above technical resistance at Friday’s seven-year high of $93.17 and then at $94.00. Look for sell stops just below technical support at Friday’s low of $90.07 and then at $89.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
U.S. grain futures are higher in early U.S. pre-market trading. Soybean and corn market bulls have the solid overall near-term technical advantage. Wheat bulls and bears are on a level overall naer-term technical playing field amid choppy trading. On tap today is the weekly USDA export inspections 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