Monday, October 15–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
Global stock markets were mostly lower overnight. U.S.
stock indexes are pointed toward lower openings when the
New York day session begins. There is still risk aversion
in the marketplace after last week’s high volatility in the
world stock markets, led by the U.S. stock indexers that
hit 3.5-month lows.
Gold prices today hit a 10-week high on more safe-haven
demand and more short covering in the futures market. Gold
could be getting some safe-haven buying interest due to the
growing rift between the U.S. and Saudi Arabia regarding a
missing Saudi journalist who many think was killed by the
Saudi Kingdom. President Trump said there would be “severe
punishment” of the Saudi Kingdom if it was determined it
killed the journalist. A Saudi government official said his
country could retaliate against the U.S. by driving crude
oil up to a price of over $100 or $200 a barrel, or higher.
The key outside markets today find the U.S. dollar index
lower on a corrective pullback from recent gains. Meantime,
November Nymex crude oil prices are firmer on a corrective
bounce from recent selling pressure that begins to suggest
that market has topped out.
U.S. economic data due for release Monday includes retail
sales, the Empire State manufacturing survey, and
manufacturing and trade inventories.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are weaker in early
U.S. trading. Last week’s price action strongly suggests
that at least a near-term market top is in place, if not a
major top. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are
bearish early today. Today, shorter-term technical
resistance comes in at the overnight high of 2,771.25 and
then at Friday’s high of 2,785.00. Buy stops likely reside
just above those levels. Downside support for active traders
today is located at the overnight low of 2,745.25 and then
at 2,725.00. Sell stops are likely located just below those
levels. Wyckoff’s Intra-day Market Rating: 4.0
December Nasdaq index December futures: Prices are lower in
early U.S. trading. Recent price action strongly suggests a
near-term market top is in place, if not a major market top.
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 bearish
early today. Shorter-term technical resistance is seen at
the overnight high of 7,179.00 and then at 7,200.00. Buy
stops likely reside just above those levels. On the
downside, short-term support is seen at the overnight low of
7,080.50 and then at 7,050.00. Sell stops are likely located
just below those levels. Wyckoff’s Intra-Day Market Rating:
4.0.
U.S. TREASURY BONDS AND NOTES
December U.S. T-Bonds: Prices are weaker in early U.S.
trading today. Bears have the solid overall near-term
technical advantage as a six-week-old downtrend is in place
on the daily chart. Shorter-term moving averages (4- 9- 18-
day) are neutral early today. The 4-day moving average is
even with the 9-day. The 9-day is below the 18-day moving
average. Oscillators (RSI, slow stochastics) are bullish
early today. Shorter-term technical resistance is seen at
last week’s high of 138 31/32 and then at 139 16/32. Buy
stops likely reside just above those levels. Shorter-term
support lies at the overnight low of 138 10/32 and then at
138 even. Sell stops likely reside just below those levels.
Wyckoff’s Intra-Day Market Rating: 4.5
December U.S. T-Notes: Prices are weaker in early U.S.
trading. Bears have the solid overall near-term technical
advantage. Prices are in a six-week-old downtrend on the
daily bar chart. Shorter-term moving averages (4- 9- 18-
day) are neutral early today. The 4-day moving average is
above the 9-day. The 9-day is below the 18-day moving
average. Oscillators (RSI, slow stochastics) are bullish
early today. Shorter-term resistance lies at the last
week’s high of 118.14.5 and then at 118.16.0. Buy stops
likely reside just above those levels. Shorter-term
technical support lies at the overnight low of 118.05.0 and
then at 118.00.0. Sell stops likely reside just below those
levels. Wyckoff’s Intra-Day Market Rating: 4.0
U.S. DOLLAR INDEX
The December U.S. dollar index is weaker in early U.S.
trading. Bulls still have the overall near-term technical
advantage. The shorter-term moving averages for the dollar
index are neutral early today, as the 4-day is below 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 95.060 and then at
95.470. Shorter-term support is seen at last week’s low of
94.640 and then at 94.500. Wyckoff’s Intra Day Market
Rating: 4.0
NYMEX CRUDE OIL
November Nymex crude oil prices are higher in early U.S.
trading, on a corrective bounce from recent strong selling
pressure that still suggests this market has topped out. The
bulls have the overall near-term technical advantage. The
shorter-term moving averages are neutral early today as the
4-day is below the 9-day and 18-day. The 9-day is above the
18-day moving average. Short-term oscillators (RSI and slow
stochastics) are neutral early today. Look for buy stops to
reside just above technical resistance at the overnight high
of $72.70 and then at $73.00. Look for sell stops just below
technical support at the overnight low of $71.27 and then at
last week’s low of $70.51. Wyckoff’s Intra-Day Market
Rating: 5.5
GRAINS
Grain futures prices were weaker overnight. Traders are
awaiting today’s weekly USDA export inspections report.
While market bottoms look to be in place for all three major
grain markets, the upside is limited by big U.S. corn and
soybean crops being harvested—despite current harvest
delays. Still, my bias is for choppy and sideways-to-higher
price action into the end of this year.
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
