Friday, December 22–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mixed to weaker overnight in quieter, pre-holiday trading. U.S. stock indexes are pointed toward firmer openings when the New York day session begins. U.S. lawmakers passed a continuing resolution bill overnight to ensure the government did not shut down in the coming days.
There were no major news developments overnight to move the markets. Look for trading activity in most markets to be very light Friday, as some markets close early ahead of the three-day Christmas holiday weekend.
The key outside markets on Friday morning find the U.S. dollar index slightly higher and Nymex crude oil prices weaker.
U.S. economic data due for release Friday includes durable goods orders, personal income and outlays, the University of Michigan consumer sentiment survey, new residential sales and the Kansas City Fed manufacturing survey.
–Jim
U.S. STOCK INDEXES
March S&P 500 December e-mini futures: Prices are slightly higher and not far below this week’s contract and record high. Bulls have the solid overall near-term technical advantage. There are still no strong, early chart clues to suggest 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 neutral early today. Today, shorter-term technical resistance comes in at the contract high of 2,698.00 and then at 2,715.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at this week’s low of 2,679.00 and then at 2,665.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5
March Nasdaq index December futures: Prices are slightly higher in early U.S. trading and not far below this week’s contract and record high. The 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 and 18-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 Thursday’s high of 6,520.75 and then at the contract high of 6,545.75. Buy stops likely reside just above those levels. On the downside, short-term support is seen at this week’s low of 6,463.25 and then at 6,446.50. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES
March U.S. T-Bonds: Prices are weaker in early U.S. trading. After this week’s big down-move bears have the firm 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 and 18-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 Thursday’s high of 151 8/32 and then at 151 28/32. Buy stops likely reside just above those levels. Shorter-term support lies at this week’s low of 150 14/32 and then at 150 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
March U.S. T-Notes: Prices are near steady in early U.S. trading. Prices hit a contract low on Thursday. 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 Thursday’s high of 123.20.0 and then at 123.26.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at Thursday’s contract low of 123.12.5 and then at 123.08.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
U.S. DOLLAR INDEX
The March U.S. dollar index is slightly higher in early U.S. trading. Trading has turned choppy and sideways. The shorter-term moving averages for the dollar index are neutral as the 4-day is below 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 early today. The dollar index finds shorter-term technical resistance at 93.310 and then at this week’s high of 93.555. Shorter-term support is seen at this week’s low of 92.750 and then at 92.500. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
February Nymex crude oil prices are slightly lower in early U.S. trading. Bulls have the firm overall near-term technical advantage. However, stiff resistance lies just above the market now. Look for buy stops to reside just above technical resistance at this week’s high of $58.38 and then at the November high of 58.99. Look for sell stops just below technical support at $57.50 and then at this week’s low of $56.88. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Grain futures markets were mixed to slightly lower overnight. Not much new. Grain market bears remain in technical control. However, bullish weekly high closes in corn and wheat today would begin to suggest market bottoms are in place. Look for continued low daily price volatility for the grain futures into the end of year.