Thursday, July 25–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mixed to weaker overnight, as Asian bourses were mostly lower and European equities mostly higher. U.S. stock indexes are pointed toward mixed openings when the New York day session begins. U.S. stock index futures on Wednesday hit new contract or multi-month highs.
The buzz in the marketplace this morning is the big downside hit to the Facebook stock price after that company posted a big miss in earnings Wednesday afternoon.
The key “outside markets” today find Nymex crude oil prices near steady and trading just above $69.00 a barrel. The U.S. dollar index is weaker early today.
The big U.S. economic data point of the week is Friday’s first estimate of gross domestic product (GDP). The number is expected to come in at up a strong 4.4%. However, some analysts are even calling for a number of 5.0% or just above.
U.S. economic data due for release Thursday includes the weekly jobless claims report, durable goods orders and the Kansas City Fed manufacturing survey.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are slightly lower on profit taking after hitting a 5.5-month high on Wednesday. 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 this week’s high of 2,838.50 and then at 2,850.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at Wednesday’s low of 2,814.00 and then at this week’s low of 2,792.50. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5
September Nasdaq index December futures: Prices are lower in early trading, on profit taking after hitting a contract high on Wednesday. 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 7,429.75 and then at 7,450.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 7,388.50 and then at 7,350.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES
September U.S. T-Bonds: Prices are lower in early U.S. trading. 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 early today. Shorter-term technical resistance is seen at the Wednesday’s high of 143 19/32 and then at 144 even. Buy stops likely reside just above those levels. Shorter-term support lies at this week’s low of 142 20/32 and then at 142 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
September U.S. T-Notes: Prices are lower in early U.S. trading. 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 early today. Shorter-term resistance lies at Wednesday’s high of 119.22.5 and then at 119.28.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at this week’s low of 119.10.5 and then at 119.06.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
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 but trading has turned choppy. The shorter-term moving averages for the dollar index are neutral early today, 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 bearish early today. The dollar index finds shorter-term technical resistance at this week’s high of 94.635 and then at 95.000. Shorter-term support is seen at the overnight low of 93.870 and then at 93.500. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
September Nymex crude oil prices are slightly lower in early U.S. trading. The shorter-term moving averages are neutral early today as the 4-day is above the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral to bullish early today. Look for buy stops to reside just above technical resistance at the overnight high of $69.74 and then at $70.00. Look for sell stops just below technical support at $68.00 and then at this week’s low of $67.56. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Grain futures prices were higher overnight. Bulls have gained good upside momentum late this week. A surprisingly downbeat trader take on a U.S. spring wheat crop tour this week has boosted wheat prices sharply higher, and corn and soybeans are seeing spillover support. Also, with the spring wheat crop surprisingly missing heretofore very upbeat condition expectations, many are wondering if the same will hold true for corn and soybean conditions in the Midwest in the coming few weeks.
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