Friday, January 26–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were steady to mixed overnight. U.S.
stock indexes are pointed toward higher openings when the
New York day session begins.
The marketplace is still buzzing about comments from U.S.
President Donald Trump that were aired by CNBC on Thursday
afternoon. Trump said he ultimately wants a stronger U.S.
dollar. His remarks briefly roiled the currency markets,
with the U.S. dollar index popping on the news and other
currencies backing way off their daily highs. However, the
dollar-bullish comments from Trump quickly wore off, as
traders reckoned the slide in the dollar has been going on
for some time now and nothing changed from Trump’s
comments.
Trump is set to speak soon at the Davos World Economic
Forum. His speech will be closely monitored by the
marketplace.
The U.S. Dollar Index is solidly lower in early U.S.
trading and not far above this week’s 3.5-year low.
Meantime, Nymex crude oil prices are slightly higher, above
$65.00 a barrel, and not far below this week’s more-than-
three-year high.
The U.S. economic data point highlight of the week is this
morning’s release of the fourth-quarter gross domestic
product report. The GDP number is forecast to come in at up
2.9%. A significant miss by the consensus forecast is
likely to impact many markets.
Other U.S. economic data due for release Friday includes the
advance economic indicators report and durable goods orders.
–Jim
U.S. STOCK INDEXES
March S&P 500 December e-mini futures: Prices are higher in
early U.S. trading and close to Wednesday’s contract and
record high. Bulls have the solid overall near-term
technical advantage. However, the market is still short-term
overbought and due for a decent downside correction. 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 neutral to bullish
early today. Today, shorter-term technical resistance comes
in at the contract high of 2,855.25 and then at 2,865.00.
Buy stops likely reside just above those levels. Downside
support for active traders today is located at 2,825.50 and
then at 2,815.00. Sell stops are likely located just below
those levels. Wyckoff’s Intra-day Market Rating: 6.0
March Nasdaq index December futures: Prices are higher in
early U.S. trading and not far below the contract and record
high set Wednesday. The bulls have the solid overall near-
term technical advantage. However, the market is still
short-term overbought and due for a decent downside
correction soon. 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
to bullish early today. Shorter-term technical resistance is
seen at the contract high of 7,004.25 and then at 7,025.00.
Buy stops likely reside just above those levels. On the
downside, short-term support is seen at the overnight low of
6,934.25 and then at 6,900.00. Sell stops are likely located
just below those levels. Wyckoff’s Intra-Day Market Rating:
6.0.
U.S. TREASURY BONDS AND NOTES
March U.S. T-Bonds: Prices are weaker in early U.S. trading.
Bears have the solid overall near-term technical advantage.
Shorter-term moving averages (4- 9- 18-day) are bearish
early today. The 4-day moving average is below 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 the overnight
high of 149 15/32 and then at this week’s high of 149 22/32.
Buy stops likely reside just above those levels. Shorter-
term support lies at 148 17/32 and then at the contract low
of 148 7/32. Sell stops likely reside just below those
levels. Wyckoff’s Intra-Day Market Rating: 4.0
March U.S. T-Notes: Prices are lower in early U.S. trading.
Bears have the solid overall near-term technical advantage.
Shorter-term moving averages (4- 9- 18-day) are bearish
early today. The 4-day moving average is below 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 this week’s high of
122.17.5 and then at 122.24.0. Buy stops likely reside just
above those levels. Shorter-term technical support lies at
the contract low of 121.31.0 and then at 121.24.0. Sell
stops likely reside just below those levels. Wyckoff’s
Intra-Day Market Rating: 4.0
U.S. DOLLAR INDEX
The March U.S. dollar index is solidly lower in early U.S.
trading and near this week’s more-than-three-year low. Bears
have the solid overall near-term technical advantage. The
shorter-term moving averages for the dollar index are
bearish as the 4-day is below the 9-day. The 9-day is below
the 18-day moving average. Short-term oscillators for the
dollar index are neutral to neutral early today. The dollar
index finds shorter-term technical resistance at 89.000 and
then at the overnight high of 89.180. Shorter-term support
is seen at the overnight low of 88.565 and then at this
week’s low of 88.255. Wyckoff’s Intra Day Market Rating: 3.0
NYMEX CRUDE OIL
March Nymex crude oil prices are modestly higher in early
U.S. trading and not far below this week’s more-than-three-
year high. Bulls have the solid overall near-term technical
advantage. Look for buy stops to reside just above technical
resistance at this week’s high of $66.66 and then at $67.00.
Look for sell stops just below technical support at the
overnight low of $64.91 and then at $64.00. Wyckoff’s Intra-
Day Market Rating: 6.0
GRAINS
Grain futures were firmer overnight. The rally in crude oil
and slumping U.S. dollar are bullish for the grains and are
helping to suggest major lows have been put in and that
prices can move sideways to higher in the coming months.