Friday, November 10–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mostly weaker overnight, on profit taking and on worries about U.S. tax reform legislation getting bogged down in Congress. U.S. stock indexes are pointed toward moderately lower openings when the New York day session begins.
There were no significant news developments overnight to move the markets.
The key outside markets on Friday find U.S. dollar index near steady in early U.S. trading. The greenback bulls have faded a bit late this week.
Meantime, Nymex crude oil futures prices are slightly lower and are trading just above $57.00 a barrel Friday morning, after nearby futures hitting a two-year high on Wednesday. However, it is still my bias that Nymex crude won’t be able to sustain prices at or above $60.00 a barrel.
U.S. economic data due for release Friday is light includes the University of Michigan consumer sentiment survey. Friday is the U.S. Veterans Day federal holiday.
–Jim
U.S. STOCK INDEXES
S&P 500 December e-mini futures: Prices are weaker in early U.S. trading, on profit taking after hitting a contract and record high on Thursday. Bulls still have the solid overall near-term technical advantage. However, lower price action today would confirm a bearish “key reversal” down on the daily bar chart, which would be an early technical clue that a market top is in place. The shorter-term moving averages (4-, 9- and 18-day) are still 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 bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 2,585.75 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 2,563.25 and then at 2,550.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.0
Nasdaq index December futures: Prices are lower in early U.S. trading, on profit taking after hitting a contract and record high on Thursday. Lower price action today would confirm a bearish “key reversal” down on the daily bar chart, which would be an early technical clue that a market top is in place. But right now the bulls still have the firm overall near-term technical advantage. Shorter-term moving averages (4- 9-and 18-day) are still 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 6,321.00 and then at the contract high of 6,351.50. Buy stops likely reside just above those levels. On the downside, short-term support is seen at this week’s low of 6,244.75 and then at 6,200.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES
December U.S. T-Bonds: Prices are sharply lower in early U.S. trading. Bulls have lost their slight overall near-term technical advantage. 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 bearish early today. Shorter-term technical resistance is seen at 153 even and then at 153 16/32. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 152 20/32 and then at 152 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 3.5
December U.S. T-Notes: Prices are lower in early U.S. trading. Bears have the overall near-term technical advantage and have gained momentum late this week. 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 bearish early today. Shorter-term resistance lies at the overnight high of 125.05.0 and then at 125.10.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 124.26.5 and then at 124.20.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
U.S. DOLLAR INDEX
The December U.S. dollar index is slightly higher in early U.S. trading. A two-month-old uptrend is still in place on the daily bar chart, but now just barely. 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 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 the overnight high of 94.550 and Thursday’s high of 94.865. Shorter-term support is seen at the overnight low of 94.300 and then at 94.000. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
December Nymex crude oil prices are slightly lower in early U.S. trading. Prices hit a two-year high, basis nearby futures, on Wednesday. Bulls still have the firm overall near-term technical advantage amid a near-term price uptrend being in place. Look for buy stops to reside just above technical resistance at this week’s high of 57.92 and then at $58.50. Look for sell stops just below technical support at $56.41 and then at $56.00. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Grain futures markets were weaker overnight. Traders are still digesting the monthly USDA supply and demand report issued on Thursday that was surprisingly bearish, showing a record U.S. average corn yield. Bears were given a fresh shot of power Thursday, to now suggest a bit more downside pressure in the near term.