Monday, September 24–Jim Wyckoff’s Morning Markets Report
OVERNIGHT DEVELOPMENTS
World stock markets were mostly lower overnight. U.S. stock
indexes are pointed toward weaker openings when the New
York day session begins. There is a bit more risk aversion
in the world marketplace to start the trading week, as
U.S.-China trade tensions are back on the front burner
after China accused President Trump of being a trade bully
and cancelled trade talks that had been set up for this
week. And tariffs on $200 billion more in Chinese imports
to the U.S. are set to kick in today. Stocks markets in
China, Japan and South Korea were closed Monday for a
holiday.
Focus this week will also be the Federal Reserve’s two-day
Open Market Committee (FOMC) meeting that begins Tuesday.
The FOMC is expected to slightly raise U.S. interest rates
at this meeting. Fed Chairman Jerome Powell will also hold
a press conference after the meeting.
The key outside markets today find the U.S. dollar index
lower. Prices Friday hit a 2.5-month low. The greenback
bears have downside technical momentum to suggest a market
top is in place for the USDX. Meantime, November Nymex
crude oil prices are solidly higher and hit a contract high
today, and trading just above $72.00 a barrel.
U.S. economic data due for release today includes the
Chicago Fed national activity index and the Texas
manufacturing outlook survey.
–Jim
U.S. STOCK INDEXES
December S&P 500 e-mini futures: Prices are slightly lower
on mild profit taking after hitting a contract and record
high on Friday. The bulls have the firm overall near-term
technical advantage. The shorter-term moving averages (4-,
9- and 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. Short-term oscillators (RSI, slow
stochastics) are neutral to bearish early today. Today,
shorter-term technical resistance comes in at the contract
high of 2,947.00 and then at 2,960.00. Buy stops likely
reside just above those levels. Downside support for active
traders today is located at the overnight low of 2,923.25
and then at 2,913.25. Sell stops are likely located just
below those levels. Wyckoff’s Intra-day Market Rating: 5.0
December Nasdaq index December futures: Prices are weaker in
early U.S. trading, on profit taking. Bulls still have the
firm 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. 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 7,550.00 and
then at 7,600.00. Buy stops likely reside just above those
levels. On the downside, short-term support is seen at
7,500.00 and then at 7,450.00. Sell stops are likely located
just below those levels. Wyckoff’s Intra-Day Market Rating:
4.5.
U.S. TREASURY BONDS AND NOTES
December U.S. T-Bonds: Prices are lower in early U.S.
trading. Bears have the firm overall near-term technical
advantage as a four-week-old downtrend is in place on the
daily chart. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to
bearish early today. Shorter-term technical resistance is
seen at the overnight high of 140 15/32 and then at 140
23/32. Buy stops likely reside just above those levels.
Shorter-term support lies at the overnight low of 140 even
and then at last week’s low of 139 23/32. Sell stops likely
reside just below those levels. Wyckoff’s Intra-Day Market
Rating: 4.0
December U.S. T-Notes: Prices are weaker in early U.S.
trading. Bears have the firm overall near-term technical
advantage. Prices are in a four-week-old downtrend on the
daily bar chart. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are
neutral to bearish early today. Shorter-term resistance
lies at the overnight high of 118.23.0 and then at
118.27.0. Buy stops likely reside just above those levels.
Shorter-term technical support lies at last week’s low of
118.14.0 and then at 118.10.0. 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 and not far above
last week’s 2.5-month low in early U.S. trading. The bulls
are fading as a five-week-old downtrend is in place on the
daily bar chart, to suggest a market top is in place. 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 94.000 and then at 94.320. Shorter-term
support is seen at last week’s low of 93.395 and then at
93.000. Wyckoff’s Intra Day Market Rating: 4.5
NYMEX CRUDE OIL
November Nymex crude oil prices are higher and hit a
contract high in early U.S. trading. The bulls have the firm
overall near-term technical advantage, but it’s at present
price levels that rallies this year have petered out. 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 the overnight
contract high of $72.39 and then at $73.00. Look for sell
stops just below technical support at the overnight low of
$71.14 and then at $70.00. Wyckoff’s Intra-Day Market
Rating: 6.5
GRAINS
Grain futures prices were mixed to lower overnight. The
U.S.-China trade war remains bearish for grains. Grain
market bears still have the overall near-term technical
advantage. Corn looks like it might be bottoming but bulls
need to show more power early this week to better suggest
such. Same goes for soybeans. U.S. corn and soybean harvest
pressure is under way, so look for farmer selling pressure
to limit the upside.
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
