Thursday, December 7–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mostly higher overnight. U.S. stock indexes are pointed toward firmer openings when the New York day session begins.
Gold prices are lower in early U.S. trading and hit a more-than-four-month low overnight.
Traders and investors are monitoring U.S. government lawmakers’ negotiations with President Trump over a stop-gap measure to keep the federal government in operation. It’s expected the stop-gap funding bill will be implemented later this week.
In overnight news, the Euro zone third-quarter GDP came in unrevised at up 0.6% from the second quarter and up 2.6%, year-on-year. Those numbers were very close to market expectations.
The key “outside markets” Thursday morning see the U.S. dollar index modestly higher. Nymex crude oil futures prices are also firmer early today. The price uptrend in crude oil has stalled, with strong overhead technical resistance levels preventing gains.
The U.S. economic report highlight of the trading week will be Friday morning’s November U.S. employment report from the Labor Department. The key non-farm payrolls number is forecast to be up 195,000. Wednesday’s U.S. ADP national employment report for November showed a rise of 190,000 jobs.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the Challenger job-cuts report, and the consumer credit report.
–Jim
U.S. STOCK INDEXES
March S&P 500 December e-mini futures: Prices are slightly higher in early U.S. trading. Prices hit a contract and record high Monday. Bulls still have the solid overall near-term technical advantage. There are no strong, early chart clues to suggest a market top is close at hand. 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 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 the overnight high of 2,639.75 and then at 2,650.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at this week’s low of 2,622.50 and then at 2,606.25. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 5.5
March Nasdaq index December futures: Prices are firmer in early U.S. trading. The bulls have the overall near-term technical advantage. However, the recent higher volatility at higher price levels is a warning signal of a topping process. 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 average is even with the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the overnight high of 6,346.50 and then at 6,375.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 6,300.00 and then at 6,275.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5.
U.S. TREASURY BONDS AND NOTES
March U.S. T-Bonds: Prices are near steady in early U.S. trading. Bulls have the overall near-term technical advantage with this week’s good gains. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-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 154 3/32 and then at this week’s high of 154 18/32. Buy stops likely reside just above those levels. Shorter-term support lies at the Wednesday’s low of 153 17/32 and then at 153 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
March 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 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 resistance lies at the overnight high of 124.18.5 and then at this week’s high of 124.23.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at Wednesday’s low of 124.09.5 and then at 124.02.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
U.S. DOLLAR INDEX
The March U.S. dollar index is firmer and hit a two-week high in early U.S. trading. Bulls have gained some upside momentum this week. The shorter-term moving averages for the dollar index are neutral as the 4-day is above the 9-day and 18-day. The 9-day is below 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 93.500 and then at 93.750. Shorter-term support is seen at the overnight low of 93.170 and then at 93.000. Wyckoff’s Intra Day Market Rating: 5.5
NYMEX CRUDE OIL
January Nymex crude oil prices are slightly higher in early U.S. trading. Bulls still have the overall near-term technical advantage, but the price uptrend has stalled. Look for buy stops to reside just above technical resistance at $57.00 and then at Wednesday’s high of 57.57. Look for sell stops just below technical support at $55.50 and then at $55.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures markets were weaker overnight. Corn and wheat market bulls are still struggling, even though my bias is that these markets have put in, or are close to putting in, market bottoms. Soybean bulls have some upside momentum. Traders will closely monitor today’s weekly export sales report.