Thursday, December 24–Jim Wyckoff’s Morning Markets Report
Global stock markets that were open Friday were mostly up. Some European markets were closed for the Christmas holiday and many U.S. markets, including the stock indexes, close early today, ahead of Christmas Day on Friday. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins.
The marketplace remains tentative on this last trading day of the holiday-shortened week. President Trump unexpectedly vetoed a big U.S. defense spending bill on Wednesday and has held up a financial stimulus package for Americans that Congress had passed earlier this week. This comes at the same time the Covid-19 pandemic continues its rampage in the U.S., Europe and many other countries. Traders and investors are worried about the specter of more business and public restrictions coming soon.
On the bright side, European markets were upbeat on continued progress between the U.K. and the European Union on a smooth Brexit deal. Some reports said a deal could be reached on the matter soon.
The U.S. dollar index is lower in early U.S. trading. The other important outside market sees February Nymex crude oil futures prices weaker and trading around $47.75 a barrel. The yield on the benchmark 10-year U.S. Treasury note futures is currently trading around 0.94%.
There is no major U.S. economic data due for release Thursday as the U.S. government is closed for the Christmas Eve holiday.
–Jim
U.S. STOCK INDEXES
March S&P 500 e-mini futures: Prices are slightly up in early U.S. trading. A near-term price uptrend has been at least temporarily negated with Monday’s big spike down in prices. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is below 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 Wednesday’s high of 3,701.75 and then at the record high of 3,724.00. Buy stops likely reside just above those levels. Downside support for active traders is seen at Wednesday’s low of 3,651.00 and then at 3,620.00. Wyckoff’s Intra-day Market Rating: 5.5
March Nasdaq index futures: Prices are slightly higher in early U.S. trading. Bulls have the solid overall near-term technical advantage. 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 the record high of 12,789.75 and then at 12,850.00. On the downside, shorter-term support is seen at the overnight low of 12,631.50 and then at 12,550.00. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES FUTURES
March U.S. T-Bonds: Prices are near steady in early U.S. trading. Bears have the overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is even with the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at 173 even and then at Wednesday’s high of 173 14/32. Shorter-term support lies at 172 even and then at this week’s low of 171 16/32. Wyckoff’s Intra-Day Market Rating: 5.0
March U.S. T-Notes: Prices are slightly higher in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term resistance lies at 138.00.0 and then at Wednesday’s high of 138.03.0. Shorter-term technical support lies at this week’s low of 137.20.0 and then at 137.15.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
EURO CURRENCY
The March Euro currency futures are firmer early today. Bulls are in solid technical control. The shorter-term moving averages for the Euro are neutral early today, as the 4-day is even with 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 Wednesday’s high of 1.2251 and then at this week’s high of 1.2290. Shorter-term support is seen at 1.2185 and then at this week’s low of 1.2158. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
February Nymex crude oil prices are weaker in early U.S. trading. Bulls still have the solid overall near-term technical advantage amid a price uptrend in place on the daily chart. The shorter-term moving averages are neutral early today as the 4-day is below the 9-day. The 9-day is above 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 the overnight high of $48.62 and then at the December high of $49.43. Look for sell stops just below technical support at $47.00 and then at this week’s low of $46.16. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
US grain futures are mixed to higher in early U.S. pre-market trading. The grain markets bulls have had a very good week and have the solid overall near-term technical advantage amid price uptrends in place on the daily charts. The supply and demand fundamentals in the grains continue to favor the bulls. Dry weather in South American growing regions is also bullish for corn and soybeans. The grain markets are getting over-extended on a short-term technical basis and are soon due for normal corrective pullbacks in their uptrends.
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