Tuesday, March 22–Jim Wyckoff’s Morning Markets Report
Global stocks markets were mostly higher overnight. The U.S. stock indexes are pointed toward firmer openings when the New York day session begins. The Russia-Ukraine war situation has not changed much recently, so risk aversion in the marketplace remains elevated. President Biden Thursday meets with NATO and EU leaders to discuss Russia’s invasion of Ukraine. The two-day summit will be held at NATO headquarters in Brussels.
The U.S. Treasury markets are under more selling pressure Tuesday, following more hawkish rhetoric coming from Federal Reserve Chairman Jerome Powell on Monday. The Fed chief said he is prepared to raise the key U.S. interest rate by 0.5% if conditions warrant. The Fed did a 0.25% rate hike last week. Powell also implied that the fight to keep inflation under control is important enough to risk slowing down U.S. economic growth in that effort.
The key outside markets see Nymex crude oil prices weaker and trading around $111.00 a barrel. Oil prices are rising sharply again on ideas the European Union is moving closer to banning oil imports from Russia. The U.S. dollar index is firmer today. The benchmark U.S. 10-year Treasury note is presently yielding 2.359%.
U.S. economic data due for release Tuesday includes the Johnson Redbook and chain store sales index, and the Richmond Fed business survey.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are firmer in early U.S. trading. The shorter-term moving averages (4-, 9- and 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-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 4,500.00 and then at 4,550.00. Support for active traders is seen at this week’s low of 4,415.00 and then at 4,400.00. Wyckoff’s Intra-day Market Rating: 5.5
June Nasdaq index futures: Prices are a bit higher 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 and 18-day. The 9-day average is even with the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at 14,500.00 and then at 14,700.00. On the downside, shorter-term support is seen at this week’s low of 14,183.75 and then at 14,000.00. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are lower and hit another contract low in early U.S. trading. Bears are in solid command. 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 150 3/32 and then at 151 even. Shorter-term support lies at the overnight contract low of 148 26/32 and then at 148 16/32. Wyckoff’s Intra-Day Market Rating: 3.5
June U.S. T-Notes: Prices are lower and hit a contract low 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 bearish early today. Shorter-term resistance lies at the overnight high of 123.11.5 and then at 123.16.0. Shorter-term technical support lies at the overnight contract low of 122.26.0 and then at 122.20.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 3.5
EURO CURRENCY
The June Euro currency futures are slightly lower in early U.S. trading. Bears have the overall near-term technical advantage. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is above the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are neutral to bearish early today. The Euro currency finds shorter-term technical resistance at this week’s high of 1.1104 and then at last week’s high of 1.1172. Shorter-term support is seen at the overnight low of 1.0994 and then at last week’s low of 1.0936. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
Nymex crude oil prices are slightly lower in early U.S. trading. The shorter-term moving averages 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 (RSI and slow stochastics) are neutral today. Look for buy stops to reside just above technical resistance at the overnight high of $115.01 and then at $117.50. Look for sell stops just below technical support at the overnight low of $109.30 and then at $107.50. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
U.S. grain futures prices were higher in early U.S. pre-market trading, with wheat leading the way. Corn and soybean market bulls remain in firm overall technical control and wheat futures are now neutral. Geopolitics remains the main driver of the grains and that suggests volatility continuing to be elevated for at least the near term. The all-important USDA planting intentions report on March 31 is coming into view for grain traders.
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