Wednesday, July 11–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were lower overnight. U.S. stock indexes are pointed toward solidly lower openings when the New York day session begins. The U.S. has targeted China with 10% tariffs on another $200 billion in Chinese product imports, and China again responded with another threat to retaliate. The U.S.-China trade war has at least temporarily cast a pall over world equity markets at mid-week.
U.S. President Trump is in Europe today meeting with European leaders, with a meeting with Russian President Vladimir Putin later this week. The marketplace will watch Trump’s meetings closely, as the U.S. president has had harsh words for European leaders regarding trade and their lack of financial support for NATO.
The important U.S. economic data due out this week includes the producer price index on Wednesday and the consumer price index on Thursday. Today’s PPI report for June is forecast up 0.2% from May, with the June CPI report on Thursday also seen up 0.2% from May.
The key “outside markets” today find Nymex crude oil prices lower and trading around $73.50 a barrel. Libyan oil exports are hitting the world market again, after being disrupted by political violence, and that’s putting some pressure on crude today.
Meantime, the U.S. dollar index is higher on a corrective bounce from recent selling pressure.
Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, monthly wholesale trade and the weekly DOE liquid energy stocks report.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are lower in early U.S. trading, on profit taking after hitting a four-month high on Tuesday. The bulls still have the firm overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is even with the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at the overnight high of 2,787.00 and then at this week’s high of 2,797.75. Buy stops likely reside just above those levels. Downside support for active traders today is located at this week’st low of 2,761.75 and then at 2,750.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.0
September Nasdaq index December futures: Prices are lower on profit taking after hitting a two-week high on Tuesday. Bulls still have the firm overall near-term technical advantage. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the overnight high of 7,272.75 and then at 7,300.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 7,204.50 and then at 7,150.00. 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 higher in early U.S. trading. Prices are in a near-term uptrend. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the overnight high of 145 24/32 and then at this week’s high of 145 28/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 145 10/32 and then at this week’s low of 144 30/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0
September U.S. T-Notes: Prices are higher in early U.S. trading. Prices are in an uptrend on the daily bar chart. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at the overnight high of 120.13.0 and then at last week’s high of 120.20.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at this week’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: 6.0
U.S. DOLLAR INDEX
The September U.S. dollar index is higher in early U.S. trading, on a corrective bounce from recent selling pressure. Bulls have the overall near-term technical advantage. 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 neutral to bullish early today. The dollar index finds shorter-term technical resistance at this week’s high of 94.225 and then at 94.500. Shorter-term support is seen at the overnight low of 93.880 and then at this week’s low of 93.440. Wyckoff’s Intra Day Market Rating: 6.0
NYMEX CRUDE OIL
August Nymex crude oil prices are weaker in early U.S. trading. The bulls still have the firm overall near-term technical advantage. The shorter-term moving averages are neutral early today as the 4-day is even with the 9-day. The 9-day is above 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 the overnight high of $74.26 and then at this week’s high of $74.70. Look for sell stops just below technical support at $73.00 and then at $72.50. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Grain futures prices were solidly lower overnight and hit new contract or for-the-move lows amid the latest tariff threat from the U.S. against China. Grain market bears are in firm technical command. World ag trade worries and generally very good growing weather in the U.S. Corn Belt remain bearish. This week’s highlight will be the USDA monthly supply and demand report out Thursday morning.