Thursday, November 16–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mostly firmer overnight, on corrective bounces from selling pressure seen earlier this week. U.S. stock indexes are also pointed toward firmer openings when the New York day session begins.
In overnight news, the Euro zone’s October consumer price index was reported up 0.1% from September and up 1.4%, year-on-year. Those numbers were right in line with market expectations.
The key outside markets on Thursday morning find U.S. dollar index higher on a corrective bounce from selling pressure seen earlier this week. The greenback bulls have faded, technically, this week. Meantime, the Euro currency is lower on a pullback from this week’s good gains. Euro bulls have gained technical strength this week to suggest at least sideways trading in the near term.
Meantime, Nymex crude oil futures prices are slightly lower and are trading just above $55.00 a barrel. Prices are well down from the early-November high and the crude oil market appears to have topped out for now. Bearish fundamental news this week—forecast lower worldwide demand from the IEA and a bearish DOE weekly storage report—have helped to pressure oil prices lower.
U.S. economic data due for release Thursday includes the weekly jobless claims report, import and export price indexes, the Philadelphia Fed business survey, industrial production and capacity utilization, and the NAHB housing market index.
–Jim
U.S. STOCK INDEXES
S&P 500 December e-mini futures: Prices are firmer in early U.S. trading. Bulls have the overall near-term technical advantage, but have faded recently. Price action last week confirmed a bearish “key reversal” down on the daily bar chart, which is an early technical clue that a market top is in place. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at this week’s high of 2,585.50 and then at the contract high of 2,594.50. Buy stops likely reside just above those levels. Downside support for active traders today is located at this week’s low of 2,555.50 and then at 2,541.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5
Nasdaq index December futures: Prices are higher in early U.S. trading. Lower price action last week confirmed a bearish “key reversal” down on the daily bar chart, which is an early technical clue that a market top is in place. But the bulls still have the overall near-term technical advantage. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at this week’s high of 6,325.00 and then at 6,350.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 6,260.75 and then at this week’s low of 6,230.75. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES
December U.S. T-Bonds: Prices are lower in early U.S. trading, on a corrective pullback from this week’s good gains. 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 to bearish early today. Shorter-term technical resistance is seen at 154 even and then at this week’s high of 154 10/32. Buy stops likely reside just above those levels. Shorter-term support lies at the 153 10/32 and then at 153 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
December U.S. T-Notes: Prices are lower in early U.S. trading. Bears have the overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at 125.00.0 and then at the overnight high of 125.04.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at 124.20.0 and then at this week’s low of 124.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 3.5
U.S. DOLLAR INDEX
The December U.S. dollar index is higher on a corrective bounce after hitting a three-week low Wednesday. Bulls have faded this week. The shorter-term moving averages for the dollar index are bearish 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 early today. The dollar index finds shorter-term technical resistance at 94.000 and then at 94.250. Shorter-term support is seen at the overnight low of 93.705 and then at 93.500. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
December Nymex crude oil prices are slightly lower in early U.S. trading. Bulls still have the overall near-term technical advantage but are fading this week, to suggest a near-term market top is in place. Look for buy stops to reside just above technical resistance at $55.50 and then at 56.00. Look for sell stops just below technical support at this week’s low of $54.81 and then at $54.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Grain futures markets were narrowly mixed overnight. Traders will closely examine this morning’s weekly USDA export sales report. U.S. corn and soybean harvest is wrapping up, with more bountiful crops than expected. Bears still have the strength to suggest a bit more downside price pressure in the near term.