Monday, May 13–Jim Wyckoff’s Morning Markets Report
World stock markets were mostly down overnight. U.S. stock indexes are pointed toward solidly lower openings when the New York day session begins.
The failure of the U.S. and China to reach a trade deal late last week and the resulting new tariffs put in place by the U.S., including retaliatory threats from China, have the world marketplace in a downbeat mood to start the trading week. Trade officials from both countries will continue talking, however.
The marketplace is so far not being significantly impacted by news two Saudi oil tankers were attacked in the Strait of Hurmuz over the weekend. The attackers are apparently unknown. However, tensions between the U.S. and Iran have ratcheted up in recent weeks, with some speculating Iran may be behind the weekend attacks on the Saudi ships, which were not sunk but did sustain significant damage.
The key “outside markets” today see the U.S. dollar index slightly lower. Meantime, Nymex crude oil prices are higher and trading around $62.50 a barrel.
There is not major U.S. economic data due for release Monday.
–Jim
U.S. STOCK INDEXES
June S&P 500 e-mini futures: Prices are solidly lower in early U.S. trading. Bulls still have the overall near-term technical advantage but have faded to suggest a market top is in place. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 2,869.25 and then at Friday’s high of 2,893.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 2,844.25 and then at last week’s low of 2,826.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 3.5
June Nasdaq index futures: Prices are solidly lower in early U.S. trading. Bulls still have the overall near-term technical advantage but have faded to suggest a market top is in place. Shorter-term moving averages (4- 9-and 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at the overnight high of 7,551.50 and then at 7,600.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at last week’s low of 7,435.75 and then at 7,400.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 3.5.
U.S. TREASURY BONDS AND NOTES FUTURES
June U.S. T-Bonds: Prices are higher and hit a six-week high in early U.S. trading. Bulls have the solid overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9- and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at the overnight high of 149 9/32 and then at 149 24/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 148 22/32 and then at 148 16/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
June U.S. T-Notes: Prices are higher and hit a six-week high in early U.S. trading. Bulls have the solid overall near-term technical advantage. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term support lies at the overnight low of 124.00.0 and then at 123.24.0. Sell stops likely reside just below those levels. Shorter-term technical resistance lies at the overnight high of 124.10.0 and then at 124.16.0. Buy stops likely reside just above those levels. Wyckoff’s Intra-Day Market Rating: 6.0
U.S. DOLLAR INDEX
The June U.S. dollar index is slightly lower early today. Bulls have the overall near-term technical advantage but have faded recently. The shorter-term moving averages for the dollar index are bearish early today, as the 4-day is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 97.165 and then at last week’s high of 97.510. Shorter-term support is seen at last week’s low of 96.905 and then at 96.500. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
June Nymex crude oil prices are higher in early U.S. trading. Bulls have faded recently to suggest a market top is in place. The shorter-term moving averages are bearish early today as the 4-day is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bullish early today. Look for buy stops to reside just above technical resistance at last week’s high of $62.95 and then at $64.00. Look for sell stops just below technical support at $62.00 and then at $61.00. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
Grain futures prices were lower overnight. Prices are at or near contract lows. Grain market bears have the solid overall near-term technical advantage. The U.S.-China trade discussions failure late last week is adding more pressure to the grains. Traders are awaiting this morning’s weekly USDA export inspections 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