Tuesday, December 19–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mixed overnight. U.S. stock indexes are pointed toward slightly higher openings when the New York day session begins. There continues to be little risk aversion in the world marketplace, and that’s bullish for world stock markets, many of which are at or near record or multi-year highs.
Look for trading activity in most markets to dwindle as this week progresses, ahead of the upcoming Christmas holiday weekend.
In overnight news, the closely watched German Ifo business climate index fell in December to 117.2 from the record high of 117.6 in November. A number of 117.5 was expected for December.
The key “outside markets” on Tuesday morning find the U.S. dollar index slightly lower and crude oil prices firmer.
U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, and new residential construction.
–Jim
U.S. STOCK INDEXES
March S&P 500 December e-mini futures: Prices are slightly higher and near Monday’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 bullish early today. Today, shorter-term technical resistance comes in at 2,700.00 and then at 2,715.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at Monday’s low of 2,682.50 and then at 2,675.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 6.0
March Nasdaq index December futures: Prices are slightly higher and poked to another contract and record high overnight. 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 to bullish early today. Shorter-term technical resistance is seen at 6,550.00 and then at 6,575.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at Monday’s low of 6,497.50 and then at 6,475.00. 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 slightly higher in early U.S. trading. Bulls have the slight overall near-term technical advantage, but need to show more power soon to keep it. Shorter-term moving averages (4- 9- 18-day) are still 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. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at 153 16/32 and then at 154 even. Buy stops likely reside just above those levels. Shorter-term support lies at Monday’s low of 153 2/32 and then at 152 16/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
March U.S. T-Notes: Prices are slightly lower in early U.S. trading. Bears have the firm overall near-term technical advantage. 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 below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term resistance lies at Monday’s high of 124.13.5 and then at 124.17.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 124.05.0 and then at 124.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
U.S. DOLLAR INDEX
The March U.S. dollar index is slightly lower 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. The 9-day is above with 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 Monday’s high of 93.555 and then at the December high of 93.825. Shorter-term support is seen at last week’s low of 92.860 and then at 92.500. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
January Nymex crude oil prices are slightly higher in early U.S. trading. Bulls have the overall near-term technical advantage. Look for buy stops to reside just above technical resistance at Monday’s high of $57.78 and then at 58.00. Look for sell stops just below technical support at Monday’s low of $56.82 and then at $56.50. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures markets were narrowly mixed overnight. Corn and wheat market bears remain in solid technical control, with soybean bears also having the near-term chart advantage. Look for continued low daily price volatility for the grain futures into the end of year, with a downside bias.