Jim Wyckoff’s Morning Web Log
The summertime doldrums may be setting in for the market place as many traders and investors focus more on family and summer vacations than the markets. The focal point for U.S. traders this week is the FOMC meeting minutes that are due out Wednesday afternoon.
European stock markets were weaker Monday, partly due to some weaker-than-expected German industrial production data that showed the sharpest monthly decline in two years. The reading was down 1.8% in May, year-on-year. Germany is the largest economy within the European Union.
U.S. economic data due for release Monday is light and includes the employment trends index.
Wyckoff’s Daily Risk Rating: 6.0 (The two main geopolitical events of recent weeks and months—the Ukraine-Russia conflict and the Iraqi civil war—have not seen any major developments recently and have been pushed to the back burner of the market place.)
(Wyckoff’s Daily Risk Rating is your way to quickly gauge investor risk appetite in the world market place each day. Each day I assess the “risk-on” or “risk-off” trader mentality in the market place with a numerical reading of 1 to 10, with 1 being least risk-averse (most risk-on) and 10 being the most risk-averse (risk-off), and 5 being neutral.
–Jim Wyckoff
U.S. STOCK INDEXES
S&P 500 September e-mini futures: Prices are slightly lower in early trading. Bulls have the solid overall near-term technical advantage as prices hover not far last week’s record high. 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 to bearish early today. Today, shorter-term technical resistance comes in at last week’s record high of 1,978.25 and then at 1,990.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at 1,966.00 and then at 1,953.50. Sell stops are likely located just below those levels. Wyckoff’s Intra-day Market Rating: 4.5
Nasdaq index futures: Prices are slightly lower early today and trading near last week’s 14-year high. Bulls have the solid overall near-term technical advantage. 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at last week’s high of 3,918.00 and then at 3,925.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 3,900.00 and then at 3,892.50. Sell stops are likely located just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5
Dow futures: Prices are weaker in early U.S. trading. Bulls still have the solid overall near-term technical advantage as prices hover not far below last week’s record high. Buy stops likely reside just above technical resistance at the record high of 16,990 and then at 17,000. Sell stops likely reside just below technical support at Thursday’s low of 16,940 and then at 16,900. Shorter-term moving averages are bullish early today, as the 4-day moving average is above the 9-day and 18-day. The 9-day moving average is below the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are bullish early today. Wyckoff’s Intra-Day Market Rating: 4.5
U.S. TREASURY BONDS AND NOTES
September U.S. T-Bonds: Prices are firmer early today on a short-covering bounce recent solid losses. Bulls have lost their near-term technical advantage. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at 135 16/32 and then at 136 even. Buy stops likely reside just above those levels. Shorter-term technical support lies at 135 even and then at the overnight low of 134 29/32. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.5 September U.S. T-Notes: Prices are near steady in early trading. Bulls are fading. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term resistance lies at 124.10.0 and then at 124.16.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 124.02.0 and then at 124.00.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0
U.S. DOLLAR INDEX
The September U.S. dollar index is slightly higher in early trading. Bulls have regained some upside near-term technical momentum. Slow stochastics for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at the overnight high of 80.405 and then at 80.500. Shorter-term support is seen at 80.240 and then at 80.100. Wyckoff’s Intra Day Market Rating: 5.0
NYMEX CRUDE OIL
August Nymex crude oil prices are lower in early U.S. trading. Bulls have faded. In August Nymex crude, look for buy stops to reside just above resistance at $104.29 and then at $105.00. Look for sell stops just below technical support at $103.50 and then at $103.00. Wyckoff’s Intra-Day Market Rating: 4.5
GRAINS
Markets closed in overnight trading due to the U.S. Independence Day holiday weekend. Recent strong downside price action has the bears in firm technical command. This week’s trading action will be critical. If grain futures prices can rebound well off their weekly lows by Friday, it would be a clue that the markets have put in their lows. But right now the bears are having their way. Weather in the Corn Belt remains bearish, but still too wet in many areas.Extended weather forecasts presently still see no excessively dry or hot weather on the horizon.
