Thursday, August 16–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
Global stock markets were mixed overnight, with European
shares mostly up and Asian shares mostly down. U.S. stock
indexes are pointed toward higher openings when the New
York day session begins.
There is less risk aversion in the world marketplace today,
partly on news the U.S. and China are set to hold trade
talks later this month—the first negotiations in two
months. However, the threat of an emerging markets economic
and currency crisis is still on the minds of many traders
and investors, and this matter will not just disappear. The
Turkish lira, which has garnered the most scrutiny in
recent weeks, is trading higher versus the U.S. dollar
today.
The precious metals markets were hit especially hard
Wednesday, on worries about a global economic slowdown that
could be caused by a secondary currency crisis. Gold hit a
1.5-year low, silver a two-year low, platinum a 14-year low
and palladium scored a 13-month low. Supposedly safe-haven
gold and silver markets have not seen any significant
demand surface due to the potential for a currency market
contagion.
The key outside markets today find Nymex crude oil prices
lower and trading just around $65.00 a barrel. Oil prices
hit a seven-week low overnight and are trending lower.
Meantime, the U.S. dollar index is slightly lower on a
corrective pullback after hitting a 14-month high on
Wednesday.
U.S. economic data due for release Thursday includes the
weekly jobless claims report, the Philadelphia Fed business
survey and new residential construction.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are higher in early
U.S. trading. The bulls 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 and 18-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 this week’s high of
2,843.75 and then at 2,852.75. Buy stops likely reside just
above those levels. Downside support for active traders
today is located at the overnight low of 2,817.50 and then
at this week’s low of 2,803.00. Sell stops are likely
located just below those levels. Wyckoff’s Intra-day Market
Rating: 5.5
September Nasdaq index December futures: Prices are higher
in early trading. Bulls have the overall near-term technical
advantage. 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 average is above the 18-day. Short-term
oscillators (RSI, slow stochastics) are neutral early today.
Shorter-term technical resistance is seen at 7,450.00 and
then at this week’s high of 7,479.00. Buy stops likely
reside just above those levels. On the downside, short-term
support is seen at the overnight low of 7,363.25 and then at
this week’s low of 7,316.50. Sell stops are likely located
just below those levels. Wyckoff’s Intra-Day Market Rating:
6.0.
U.S. TREASURY BONDS AND NOTES
September U.S. T-Bonds: Prices are lower in early U.S.
trading. Bulls still have the overall near-term technical
advantage. Shorter-term moving averages (4- 9- 18-day) are
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 neutral to
bearish early today. Shorter-term technical resistance is
seen at the overnight high of 144 23/32 and then at this
week’s high of 145 even. Buy stops likely reside just above
those levels. Shorter-term support lies at this week’s low
of 143 27/32 and then at 143 16/32. Sell stops likely reside
just below those levels. Wyckoff’s Intra-Day Market Rating:
4.0
September U.S. T-Notes: Prices are weaker in early U.S.
trading. Bulls have the overall near-term technical
advantage. Shorter-term moving averages (4- 9- 18-day) are
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 neutral to
bearish early today. Shorter-term resistance lies at the
overnight high of 120.13.0 and then at this week’s high of
120.18.0. Buy stops likely reside just above those levels.
Shorter-term technical support lies at this week’s low of
120.01.0 and then at 119.28.0. Sell stops likely reside
just below those levels. Wyckoff’s Intra-Day Market Rating:
4.0
U.S. DOLLAR INDEX
The September U.S. dollar index is slightly lower on a
corrective pullback after hitting a 14-month high on
Wednesday. Bulls still 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 bearish early today. The dollar index finds shorter-term
technical resistance at this week’s high of 96.865 and then
at 97.000. Shorter-term support is seen at this week’s low
of 96.020 and then at 95.500. Wyckoff’s Intra Day Market
Rating: 4.5
NYMEX CRUDE OIL
September Nymex crude oil prices are near steady in early
U.S. trading and hit a seven-week low overnight. Bulls are
fading and prices are trending lower. The shorter-term
moving averages 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 (RSI and slow
stochastics) are neutral to bearish early today. Look for
buy stops to reside just above technical resistance at
$66.00 and then at $67.00. Look for sell stops just below
technical support at the overnight low of $64.43 and then at
$64.00. Wyckoff’s Intra-Day Market Rating: 5.0
GRAINS
Grain futures prices were higher overnight, on corrective
rebounds from recent selling pressure and on reports of new
trade talks between the U.S. and Russia that will take place
later this month. Traders will closely examine this
morning’s weekly USDA export sales report.
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
