Monday, February 12–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were higher overnight, following sharp losses seen last week. U.S. stock indexes are pointing toward solidly higher openings when the New York day session begins. The big question on traders’ minds to start the week is if the recent period of very high daily price volatility has ended. Price action the first couple days of this week will go a long way in answering that question.
The key “outside markets” on Monday morning see the U.S. dollar index weaker on a corrective pullback from recent good gains. Meantime, Nymex crude oil prices are firmer on a corrective bounce from recent solid losses and on the rebound in world stock markets.
U.S. economic data due for release Monday is light and includes the monthly Treasury budget statement. President Trump also releases his fiscal year 2019 budget proposal.
–Jim
U.S. STOCK INDEXES
March S&P 500 December e-mini futures: Prices are higher in early U.S. trading. Major near-term chart damage has been inflicted recently to suggest the index has put in at least a near-term market top and will have trouble sustaining any new uptrend. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Today, shorter-term technical resistance comes in at the overnight high of 2,655.00 and then at 2,675.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 2,623.00 and then at 2,600.00. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 6.0
March Nasdaq index December futures: Prices are higher in early U.S. trading. With the recent major near-term chart damage, there are chart clues that at least a near-term market top is in place and that any price uptrend renewing is still doubtful. Shorter-term moving averages (4- 9-and 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at 6,550.00 and then at 6,600.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 6,450.00 and then at the overnight low of 6,414.25. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 6.0.
U.S. TREASURY BONDS AND NOTES
March U.S. T-Bonds: Prices are lower in early U.S. trading and hit another contract low overnight. Bears have the solid 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. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term technical resistance is seen at the overnight high of 143 24/32 and then at 144 even. Buy stops likely reside just above those levels. Shorter-term support lies at the contract low of 143 4/32 and then at 143 even. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
March U.S. T-Notes: Prices are lower in early U.S. trading. Bears have the solid 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. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 120.30.0 and then at 121.08.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the contract low of 120.17.0 and then at the contract low of 120.10.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0
U.S. DOLLAR INDEX
The March U.S. dollar index is lower in early U.S. trading. Bears still have the overall near-term technical advantage, but the recent rally begins to suggest a market bottom is in place. 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 even with 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 last week’s high of 90.455 and then at 90.750. Shorter-term support is seen at the overnight low of 89.955 and then at 89.500. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
March Nymex crude oil prices are higher on short covering and bargain hunting after hitting a six-week low last week. Still, the bulls have faded badly recently to suggest a near-term market top is in place. Look for buy stops to reside just above technical resistance at the overnight high of $60.83 and then at $61.00. Look for sell stops just below technical support at $60.00 and then at the overnight low of $59.10. Wyckoff’s Intra-Day Market Rating: 6.0
GRAINS
Grain futures were higher overnight. World stock markets have rebounded early this week and the key “outside markets” are also bullish for the grains today—a weaker U.S. dollar and higher crude oil prices.