Friday, July 29–Jim Wyckoff’s Morning Markets Report
Note: I am on vacation this week. My friend and fellow analyst Ken Seehusen is producing my morning and afternoon reports. Ken’s format is a bit different than mine, but I think you will enjoy and benefit from his work.
The STOCK INDEXES
The September NASDAQ 100 was higher overnight as it extends the rally off June’s low. Overnight trading sets the stage for a higher opening when the day session begins trading. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If September extends the rally off June’s low, June’s high crossing at 12,973.75 is the next upside target. Closes below the 50-day moving average crossing at 12,070.28 would signal that a short-term top has been posted. First resistance is Thursday’s high crossing at 12,948.00. Second resistance is June’s high crossing at 12,973.75. First support is the 50-day moving average crossing at 12,070.28. Second support is the July 13th low crossing at 11,479.25. Third support is the June 30th low crossing at 11,351.00.
The September S&P 500 was higher overnight as it extends the rally off June’s low. Overnight trading sets the stage for a higher opening when the day session begins trading. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If September extends the rally off June’s low, the 50% retracement level of the January-June decline crossing at 4215.81 is the next upside target. Closes below the 20-day crossing at 3912.68 would signal that a short-term top has been posted. First resistance is the 38% retracement level of the January-June decline crossing at 4078.81. Second resistance is the 50% retracement level of the January-June decline crossing at 4215.81 First support is the 20-day moving average crossing at 3912.68. Second support is the July 14th low crossing at 3723.75.
INTEREST RATES:
September T-bonds were lower overnight as it consolidates below resistance marked by the 38% retracement level of the 2021-2022 decline crossing at 143-25. The low-range overnight trade sets the stage for a steady to lower opening when the day session begins trading. Stochastics and the RSI are overbought, diverging but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If September extends the rally off June’s low, the 50% retracement level of the 2021-2022 decline crossing at 147-27 is the next upside target. Closes below the 20-day moving average crossing at 140-06 would signal that a short-term top has been posted. First resistance is the 38% retracement level of the 2021-2022 decline crossing at 143-25. Second resistance is the 50% retracement level of the 2021-2022 decline crossing at 147-27. First support is the 20-day moving average crossing at 140-06. Second support is the 50-day moving average crossing at 138-12.
September T-notes was lower overnight as it consolidates some of Thursday’s rally but remains above broken resistance marked by the 38% retracement level of the 2021-2022 decline crossing at 120.209. Overnight trading sets the stage for a lower opening when the day session begins trading. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If September extends the rally off last-Thursday’s low, the 50% retracement level of the 2021-2022 decline crossing at 122.204 is the next upside target. Closes below the 20-day moving average crossing at 119.032 would signal that a short-term top has been posted while opening the door for additional weakness near-term. First resistance is the overnight high crossing at 121.080. Second resistance is the 50% retracement level of the 2021-2022 decline crossing at 122.204 is the next downside target. First support is the 20-day moving average crossing at 119.032. Second support is the 50-day moving average crossing at 118.119.
ENERGIES
September crude oil was higher overnight and sets the stage for a steady to higher opening when the day session begins trading. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near-term. If September renews the rally off the July 14th low, the 50-day moving average crossing at $104.21 is the next upside target. If September renews the decline off June’s high, the 38% retracement level of the 2020-2022 rally crossing at $86.43 is the next downside target. First resistance is the July 19th high crossing at $100.99. Second resistance is the 50-day moving average crossing at $104.21. First support is the July 14th low crossing at $88.23. Second support is the 38% retracement level of the 2020-2022 rally crossing at $86.43.
CURRENCIES
The September Dollar was lower overnight as it has renewed the decline off July’s high. Overnight trading sets the stage for a lower opening when the day session begins trading. Stochastics and the RSI have become oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If September extends the decline off July’s high, the 50-day moving average crossing at $104.695 is the next downside target. Closes above Wednesday’s high crossing at $107.300 would signal that a short-term low has likely been posted. First resistance is the July 14th high crossing at $109.140. Second resistance is the 87% retracement level of the 2001-2008 decline on the monthly continuation chart crossing at $114.782. First support is the overnight low crossing at $105.410. Second support is the 50-day moving average crossing at $104.694.
GRAINS
December corn was higher overnight as it extends the rally off last-Friday’s low. Overnight trading sets the stage for a higher opening when the day sessions begins trading. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. Closes above last-Monday’s high crossing at $6.23 3/4 would confirm that a short-term low has been posted while opening the door for additional gains near-term. If December renews the decline off June’s high, January low crossing at $5.42 1/2 is the next downside target. First resistance is last-Monday’s high crossing at $6.23 3/4. Second resistance is the July 11th high crossing at $6.58 1/2. First support is Tuesday’s gap crossing at $5.84 1/4. Second support is the 50% retracement level of the 2020-2022 rally crossing at $5.74 3/4.
September wheat was higher overnight as it extends the rally off last-Friday’s low. Overnight trading sets the stage for a higher opening when the day session begins trading. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near-term. Closes above last-Wednesday’s high crossing at $8.43 1/2 would signal that a short-term low has been posted. If September renews the decline off May’s high, the 75% retracement level of the January-May high crossing at $7.23 is the next downside target. First resistance is last-Wednesday’s high crossing at $8.43 1/2. Second resistance is the July 11th high crossing at $9.40 1/4. First support is the last-Friday’s low crossing at $7.54. Second support is the 75% retracement level of the January-May high crossing at $7.23.
September Kansas City wheat was higher overnight and sets the stage for a higher opening when the day session begins trading later this morning. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. Closes above the July 20th high crossing at $8.97 3/4 would confirm that a short-term low has been posted. If September renews the decline off May’s high, February’s low crossing at $7.64 1/2 the next downside target. First resistance is the July 11th high crossing at $9.98 1/4. Second resistance is the 50-day moving average crossing at $10.34 3/4. First support is the 62% retracement level of the January-May rally crossing at $8.32 3/4. Second support is the February’s low crossing at $7.64 1/2.
September Minneapolis wheat was higher overnight and sets the stage for a higher opening when the day session begins trading. Stochastics and the RSI have turned neutral to bullish signaling that sideways to higher prices are possible near-term. Closes above last-Wednesday’s high crossing at $9.56 would signal that a short-term low has been posted. If September renews the decline of May’s high, the 75% retracement level of the January-May rally crossing at $8.12 3/4 is the next downside target. First resistance is last-Wednesday’s high crossing at $9.56. Second resistance is the July 11th high crossing at $10.44 1/2. First support is last-Friday’s low crossing at $8.69 1/4. Second support is the 75% retracement level of the January-May high crossing at $8.12 3/4.
November soybeans was higher overnight as it extends the rally off last-Friday’s low. Overnight trading sets the stage for a higher opening when the day session begins trading. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near-term. Closes above the 50-day moving average crossing at $14.53 3/4 would open the door for a possible test of the June 30th high crossing at $15.07 3/4. Closes below Tuesday’s gap crossing at $13.49 1/4 would temper the near-term friendly outlook. First resistance is the 50-day moving average crossing at $14.54 3/4. Second resistance is the June 30th high crossing at $15.07 3/4. First support is the 10-day moving average crossing at $13.73 1/4. Second support is the 38% retracement level of the 2020-2022 rally crossing at $12.99 1/4.
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