Tuesday, July 3–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mixed to higher overnight. U.S.
stock indexes are pointed toward higher openings when the
New York day session begins.
European stock markets were assuaged today on news that
German Chancellor Merkel has apparently avoided a political
crisis by coming to agreement with other German lawmakers
regarding immigration laws.
In other overnight news, the Euro zone’s producer price
index in May was reported up 0.8% from April and up 3.0%,
year-on-year. Those numbers were a little higher than
expected.
The U.S. Independence Day holiday is on Wednesday, which is
likely to make trading in the U.S. light today, especially
as many markets close early today. However, some important
U.S. economic data is out later this week, including the
Fed’s FOMC minutes on Thursday and the jobs report from the
Labor Department on Friday.
Reports overnight said Monday’s trading in gold exchange
traded funds saw the largest outflow of money from those
funds since late March. Gold and silver bulls remain stymied
by their metals’ inability to rally in the face of the
threat of a global trade war and some fresh instability in
the European Union.
The key “outside markets” today find the U.S. dollar index
lower but still not far below the 12-month high hit last
week. Meantime, Nymex crude oil prices are higher, hit a
3.5-year high and trading just below $75.00 a barrel.
U.S. economic data due for release Tuesday includes the
weekly Goldman Sachs and Johnson Redbook retail sales
reports, the ISM New York report on business,
manufacturers’ shipments and inventories, the IDB/TIPP
economic optimism index and domestic auto industry sales.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are higher in early
U.S. trading. The bulls have the slight overall near-term
technical advantage. The shorter-term moving averages (4-,
9- and 18-day) are still 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 bullish early today. Today,
shorter-term technical resistance comes in at 2,750.00 and
then at 2,765.00. Buy stops likely reside just above those
levels. Downside support for active traders today is located
at the overnight low of 2,720.50 and then at last week’s low
of 2,700.50. Sell stops are likely located just below those
levels. Wyckoff’s Intra-day Market Rating: 6.0
September Nasdaq index December futures: Prices are higher
in early U.S. trading. Bulls have the overall near-term
technical advantage. Shorter-term moving averages (4- 9-and
18-day) are still 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 bullish early today. Shorter-term technical
resistance is seen at 7,175.00 and then at 7,200.00. Buy
stops likely reside just above those levels. On the
downside, short-term support is seen at 7,100.00 and then at
7,050.00. 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. 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
the overnight high of 144 29/32 and then at last week’s high
of 145 16/32. Buy stops likely reside just above those
levels. Shorter-term support lies at 144 even and then at
143 16/32. Sell stops likely reside just below those levels.
Wyckoff’s Intra-Day Market Rating: 4.5
September U.S. T-Notes: Prices are weaker in early U.S.
trading. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are bearish
early today. Shorter-term resistance lies at the overnight
high of 120.06.0 and then at last week’s high of 120.14.5.
Buy stops likely reside just above those levels. Shorter-
term technical support lies at 119.24.0 and then at
119.20.0. 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 lower in early U.S.
trading. 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. 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 the overnight high of 94.730 and
then at 95.000. Shorter-term support is seen at 94.195 and
then at 94.000. Wyckoff’s Intra Day Market Rating: 4.0
NYMEX CRUDE OIL
August Nymex crude oil prices are higher and hit a 3.5-year
high in early U.S. trading. The shorter-term moving averages
are bullish early today as the 4-day is above the 9-day. The
9-day is above with 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 $75.00 and then at $76.00. Look for sell stops
just below technical support at the overnight low of $73.92
and then at $73.00. Wyckoff’s Intra-Day Market Rating: 6.5
GRAINS
Grain futures were higher overnight on short covering and
perceived bargain hunting after hitting new for-the-move
lows on Monday. Bears are still in technical command. World
ag trade worries and generally good growing weather in the
U.S. Corn Belt remain bearish. Hotter weather is coming for
the region the next few days, but along with some rain so
traders are not worried about that. It’s going to take a
mid- or late-summer weather market scare to jump-start
rallies in the stumbling grain markets.
MPORTANT 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
