Wednesday, November 1–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
Global stock markets were mostly higher overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins, as the indexes overnight hit new record highs.
The world markets showed little reaction to a terrorist attack in New York City that killed at least eight people.
The key “outside markets” on Wednesday morning find the U.S. dollar index higher. The greenback bulls have the overall near-term technical advantage. Meantime, Nymex crude oil futures prices are higher and hit a six-month high overnight. Prices are trading right around $55.00 a barrel.
The Federal Reserve’s FOMC meeting that began Tuesday morning ends Wednesday afternoon with a statement. No monetary policy changes are expected at this meeting, but as usual traders and investors will parse the FOMC statement at the end of the meeting. It’s expected the FOMC will slightly raise U.S. interest rates at the next meeting in December.
Friday brings the U.S. employment report for October. Also, the Bank of England holds its monetary policy meeting on Thursday It is expected the BOE will tighten its monetary policy at Thursday’s meeting.
Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the ADP national employment report, the U.S. manufacturing PMI, construction spending, the ISM manufacturing report on business and the weekly DOE liquid energy stocks report.
–Jim
U.S. STOCK INDEXES
S&P 500 December e-mini futures: Prices are higher in early U.S. trading and hit a contract and record high overnight. Bulls have the solid overall near-term technical advantage and there are no strong, early technical clues that a market top is close at hand. The 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 is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at the contract high of 2,583.75 and then at 2,590.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at this week’s low of 2,565.50 and then at last week’s low of 2,541.50. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 6.5
Nasdaq index December futures: Prices are higher in early U.S. trading and hit another contract and record high overnight. Bulls have the solid 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 bullish early today. Shorter-term technical resistance is seen at the contract high of 6,284.50 and then at 6,300.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 6,246.75 and then at this week’s low of 6,202.25. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 7.0.
U.S. TREASURY BONDS AND NOTES
December U.S. T-Bonds: Prices are lower 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 above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at this week’s high of 152 19/32 and then at 153 even. Buy stops likely reside just above those levels. Shorter-term support lies at 152 even and then at this week’s low of 151 11/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
December U.S. T-Notes: Prices are lower 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 above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term resistance lies at the overnight high of 124.29.5 and then at this week’s high of 125.03.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at this week’s low of 124.23.0 and then at 124.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
U.S. DOLLAR INDEX
The December U.S. dollar index is firmer in early U.S. trading. The greenback bulls are working on a seven-week-old uptrend on the daily bar chart. The shorter-term moving averages for the dollar index are bullish early today as the 4-day is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators for the dollar index are neutral to bullish early today. The dollar index finds shorter-term technical resistance at this week’s high of 94.835 and then at last week’s high of 95.060. Shorter-term support is seen at this week’s low of 94.325 and then at 94.100. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
December Nymex crude oil prices are higher in early U.S. trading and hit a six-month high overnight. Bulls have the overall near-term technical advantage amid a near-term price uptrend being in place. Look for buy stops to reside just above technical resistance at 55.50 and then at $56.00. Look for sell stops just below technical support at the overnight low of $54.55 and then at $54.00. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
Grain futures markets were mixed overnight. Not much new. Harvest in the U.S. Corn Belt is well past the half-way point. Focus has switched to world supply and demand fundamentals. Recent price action in the grains still hints at market bottoms in place.