Tuesday, July 17–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mixed overnight. U.S. stock indexes are pointed toward slightly lower openings when the New York day session begins. In quieter summertime trading, U.S. stock indexes are near multi-month highs, to underscore the “risk-on” trader mentality in the marketplace at present.
While not really market-sensitive, the media is still buzzing about the summit meeting between U.S. President Trump and Russian President Putin on Monday. The news coverage is somewhat taking trader and investor attention away from other matters that may be more relevant to markets.
On tap today, U.S. Federal Reserve Chairman Jerome Powell testifies before the Senate Banking Committee on monetary policy. The marketplace will parse his words for clues on timing of future interest rate increases.
The key “outside markets” today find Nymex crude oil prices near steady and trading just below $68.00 a barrel. Recent solid losses in crude begin to suggest this market has topped out. World oil production is back on the rise after some recent outages from producing countries. The U.S. dollar index is weaker again today.
U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, industrial production and capacity utilization, the NAHB housing market index and Treasury international capital data.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are slightly lower in early U.S. trading after hitting a four-month high on Monday. The bulls have the firm overall near-term technical advantage. 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 neutral to bearish early today. Today, shorter-term technical resistance comes in at the March high of 2,814.00 and then at 2,825.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at 2,785.00 and then at 2,773.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5
September Nasdaq index December futures: Prices are slightly lower on profit taking after hitting a contract high last Friday. Bulls still 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 to bearish early today. Shorter-term technical resistance is seen at 7,350.00 and then at the contract high of 7,414.25. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 7,275.00 and then at 7,250.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES
September U.S. T-Bonds: Prices are near steady in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is even with 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 technical resistance is seen at Monday’s high of 145 24/32 and then at 146 even. Buy stops likely reside just above those levels. Shorter-term support lies at Monday’s low of 144 23/32 and then at 144 16/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
September U.S. T-Notes: Prices are near steady in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is even with 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 last week’s high of 120.13.0 and then at 120.00.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at Monday’s low of 120.00.0 and then at 119.24.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
U.S. DOLLAR INDEX
The September U.S. dollar index is slightly lower in early U.S. trading. Bulls still have the firm overall near-term technical advantage. The shorter-term moving averages for the dollar index are neutral early today, as the 4-day is even with the 9-day. The 9-day is below 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 Monday’s high of 94.520 and then at last week’s high of 95.000. Shorter-term support is seen at 94.000 and then at 93.750. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
August Nymex crude oil prices are slightly lower in early U.S. trading. Recent downside price action begins to suggest a market top is in place. The shorter-term moving averages are neutral early today as the 4-day is below the 9-day and 18-day. The 9-day is even with 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 $69.00 and then at $70.00. Look for sell stops just below technical support at Monday’s low of $67.58 and then at $67.00. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Grain futures prices were firmer overnight on short covering from recent selling pressure. Corn and soybean market bears remain in firm technical command amid world ag trade worries and very good growing weather in the U.S. Corn Belt. Wheat has stabilized on ideas of a shorter world wheat crop this year. Bulls need a weather market in the grains, but the clock is ticking on such developing in the U.S. Corn Belt this year.
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