Tuesday, August 9–Jim Wyckoff’s Morning Markets Report
Global stock markets were steady to mixed overnight. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session beings. Corporate earnings reports are in focus for stock traders this week. China-Taiwan tensions remain high as China is conducting military exercises near Taiwan, with Taiwan saying it will conduct its own military maneuvers.
Traders are awaiting two key U.S. inflation reports that are on deck the next two days. Wednesday comes the consumer price index report for July, which is seen coming in up 8.7%, year-on-year, after a rise of 9.1% in the June report. Thursday comes the producer price index report for July, seen up 0.2% from June and compares to the June report’s rise of 1.1% from May.
The key outside markets today see Nymex crude oil prices slightly up and trading around $91.00 a barrel. The U.S. dollar index is lower in early U.S. trading. The yield on the 10-year U.S. Treasury note is fetching 2.758%.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and chain store sales indexes, the NFIB small business index, preliminary productivity and costs, and the IDB/TIPP economic optimism index.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are slightly down in early U.S. trading. Prices Monday hit a nine-week high. Bulls have the overall near-term technical advantage amid a price uptrend in place 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 and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at Monday’s high of 4,188.88 and then at 4,204.75. Support for active traders is seen at 4,080.50 and then at 4,050.00. Wyckoff’s Intra-day Market Rating: 4.5
September Nasdaq index futures: Prices are weaker in early U.S. trading after hitting a three-month high Monday. Prices are trending higher on the daily bar chart and bulls have the 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 12,233.75 and then at 12,500.00. On the downside, shorter-term support is seen at 13,000.00 and then at the August low of 12,814.75. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are lower 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 bearish early today. Shorter-term technical resistance is seen at Monday’s high of 142 29/32 and then at 144 even. Shorter-term support lies at 141 even and then at last week’s low of 140 19/32. Wyckoff’s Intra-Day Market Rating: 4.0
September U.S. T-Notes: Prices are lower in early U.S. trading. Bulls 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 above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at Monday’s high of 120.00.5 and then at 120.16.0. Shorter-term technical support lies at last week’s low of 119.07.5 and then at 119.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
EURO CURRENCY
The September Euro currency futures are higher in early U.S. trading. Bears still have the firm overall near-term technical advantage. However, trading has been sideways and choppy for three weeks. 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 to bullish early today. The Euro currency finds shorter-term technical resistance at 1.0327 and then at 1.0400. Shorter-term support is seen at last week’s low of 1.0154 and then at 1.0100. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
Nymex crude oil prices are higher in early U.S. trading. Bears still have the overall near-term technical advantage. The shorter-term moving averages 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 (RSI and slow stochastics) are neutral to bullish early today. Look for buy stops to reside just above technical resistance at $93.00 and then at $95.00. Look for sell stops just below technical support at the overnight low of $89.05 and then at last week’s low of $87.01. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
U.S. grain futures were higher overnight, on short covering and perceived bargain hunting. Time is running short for a new weather market scare to play out this summer. Traders are awaiting Friday morning’s monthly USDA supply and demand 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