Wednesday, August 29–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mixed to lower overnight. European
bourses were down as the Euro currency is under some
pressure today, following recent gains. U.S. stock indexes
are pointed toward narrowly mixed openings and hit new
record highs overnight. Traders and investors at present
reckon the stock market is the “main game in town” as money
keeps flowing into those paper assets—at the expense of
hard assets like gold and other raw commodities, except
crude oil, which is not far below this year’s highs.
The U.S. is presently negotiating a trade agreement with
Canada after reaching a deal with Mexico earlier this week.
Part of the investor/trader optimism in the world
marketplace this week is due to ideas the U.S. will come to
terms with more of its trading partners at some point down
the road, and some sooner rather than later.
The key outside markets today find the U.S. dollar index
firmer on a corrective bounce after seeing losses earlier
this week. Meantime, Nymex crude oil prices are slightly up
and trading just below $69.00 a barrel.
U.S. economic data due for release Wednesday includes the
weekly MBA mortgage applications survey, the second
estimate of second-quarter GDP, pending home sales and the
weekly DOE liquid energy stocks report.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are near steady and
hit a contract and record high in early U.S. trading. The
bulls have the solid overall near-term technical advantage
amid an uptrend in place on the daily bar chart. The
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 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 the
overnight high of 2,905.00 and then at 2,920.00. Buy stops
likely reside just above those levels. Downside support for
active traders today is located at this week’s low of
2,876.75 and then at 2,860.00. Sell stops are likely located
just below those levels. Wyckoff’s Intra-day Market Rating:
5.5
September Nasdaq index December futures: Prices are firmer
and hit a contract and record high in early U.S. trading.
Bulls have the solid overall near-term technical advantage.
Shorter-term moving averages (4- 9-and 18-day) are neutral
early today. The 4-day moving average is above the 9-day and
18-day. The 9-day average is below the 18-day. Short-term
oscillators (RSI, slow stochastics) are bullish early today.
Shorter-term technical resistance is seen at the overnight
contract high of 7,600.00 and then at 7,625.00. Buy stops
likely reside just above those levels. On the downside,
short-term support is seen at 7,550.00 and then at this
week’s low of 7,498.75. 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 slightly up in early U.S.
trading. Bulls still have the overall near-term technical
advantage but are fading this week. 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 early today. Shorter-term technical resistance
is seen at the overnight high of 144 1/32 and then at
Tuesday’s high of 144 14/32. Buy stops likely reside just
above those levels. Shorter-term support lies at the
overnight low of 143 23/32 and then at this week’s low of
143 18/32. Sell stops likely reside just below those levels.
Wyckoff’s Intra-Day Market Rating: 5.5
December U.S. T-Notes: Prices are firmer in early U.S.
trading. Bulls still have the overall near-term technical
advantage but have faded this week. 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 early today. Shorter-term resistance lies at
the overnight high of 120.04.0 and then at Tuesday’s high
of 120.09.0. Buy stops likely reside just above those
levels. Shorter-term technical support lies at this week’s
low of 119.30.0 and then at 119.24.0. Sell stops likely
reside just below those levels. Wyckoff’s Intra-Day Market
Rating: 5.5
U.S. DOLLAR INDEX
The December U.S. dollar index is slightly up on a mild
bounce after hitting a three-week low Tuesday. The bulls
still have the overall near-term technical advantage, but
are fading. The shorter-term moving averages for the dollar
index are bearish early today, 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 this week’s high of 94.795 and then
at 95.000. Shorter-term support is seen at this week’s low
of 93.930 and then at 93.750. Wyckoff’s Intra Day Market
Rating: 5.5
NYMEX CRUDE OIL
October Nymex crude oil prices are firmer in early U.S.
trading. Bulls still have some upside momentum. The shorter-
term moving averages 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 (RSI and slow
stochastics) are bullish early today. Look for buy stops to
reside just above technical resistance at last week’s high
of $69.31 and then at $70.00. Look for sell stops just below
technical support at this week’s low of $68.34 and then at
$68.00. Wyckoff’s Intra-Day Market Rating: 5.5
GRAINS
Grain futures prices were firmer overnight, on short
covering and some optimism on the U.S. trade front. Bears
are still in control amid big U.S. soybean and corn crop
potential. Also, beneficial rains have fallen in the U.S.
Corn Belt recently as the crops near maturity.
IMPORTANT NOTE: I am not a futures broker and do not manage
any trading accounts other than my own personal account. It
is my goal to point out to you potential trading
opportunities. However, it is up to you to: (1) decide when
and if you want to initiate any traders and (2) determine
the size of any trades you may initiate. Any trades I
discuss are hypothetical in nature.
Here is what the Commodity Futures Trading Commission
(CFTC) has said about futures trading (and I agree 100%):
1. Trading commodity futures and options is not for
everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS.
Before you invest any money in futures or options contracts,
you should consider your financial experience, goals and
financial resources, and know how much you can afford to
lose above and beyond your initial payment to a broker. You
should understand commodity futures and options contracts
and your obligations in entering into those contracts. You
should understand your exposure to risk and other aspects of
trading by thoroughly reviewing the risk disclosure
documents your broker is required to give you.
Jim Wyckoff
