Thursday, June 21–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mostly weaker overnight. U.S. stock indexes are pointed toward lower openings when the New York day session begins. The specter of a global trade war is denting trader and investor confidence and is pressuring world stock and commodity markets.
In overnight news, the central banks of Switzerland and Norway held their regular monetary policy meetings. The Swiss National Bank kept its policy very easy with negative interest rates, while Norway’s central bank also kept its monetary policy unchanged, with its main interest rate at a very low 0.5%. The Bank of England is also holding its regular monetary policy meeting today.
The key “outside markets” today find the U.S. dollar index higher and hitting another 11-month high. The strong greenback is another bearish weight on the raw commodity sector.
Meantime, Nymex crude oil prices lower and trading around $64.50 a barrel. Oil traders are looking ahead to the OPEC meeting that begins Friday in Vienna, Austria. Saudi Arabia and Russia are expected to announce they will increase oil production.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the Philadelphia Fed business survey, the monthly house price index, and leading economic indicators.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are weaker in early U.S. trading. The bulls still have the 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 below the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at this week’s high of 2,786.75 and then at last week’s high of 2,796.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at 2,750.00 and then at this week’s low of 2,735.75. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5
September Nasdaq index December futures: Prices are weaker in early U.S. trading, after hitting a contract high overnight. 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at the overnight contract high of 7,358.50 and then at 7,400.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 7,250.00 and then at Wednesday’s low of 7,226.75. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5.
U.S. TREASURY BONDS AND NOTES
September U.S. T-Bonds: Prices are firmer in early U.S. trading, on short covering. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at the Wednesday’s high of 144 11/32 and then at this week’s high of 144 25/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 142 8/32 and then at 142 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
September U.S. T-Notes: Prices are firmer in early U.S. trading, on short covering. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bullish early today. Shorter-term resistance lies at the Wednesday’s high of 119.30.0 and then at this week’s high of 120.06.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 119.13.0 and then at 119.18.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5
U.S. DOLLAR INDEX
The September U.S. dollar index is solidly higher and hit another contract and 11-month high in early U.S. trading. Bulls have the solid overall near-term technical advantage. The shorter-term moving averages for the dollar index are bullish early today, as the 4-day is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at the overnight contract high of 95.220 and then at 95.500. Shorter-term support is seen at 94.000 and then at the overnight low of 94.780. Wyckoff’s Intra Day Market Rating: 6.5
NYMEX CRUDE OIL
August Nymex crude oil prices are lower in early U.S. trading. The shorter-term moving averages are bearish early today as the 4-day is below the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral to bearish early today. Look for buy stops to reside just above technical resistance at the overnight high of $65.80 and then at this week’s high of $66.35. Look for sell stops just below technical support at the overnight low of $64.34 and then at $64.00. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
Grain futures were lower overnight on more world ag trade worries. Very good growing weather in the U.S. Corn Belt is also bearish. It’s still my bias the corn and soybean markets have put in market bottoms.