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Jim Wyckoff's Morning Report: European Financial Markets Calmer

12 June 2013
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - European stock and financial markets were calmer Wednesday, following Tuesday’s keen “risk-off” trader mentality.

Industrial production in the Euro zone rose by 0.4% in April from March, for the third straight monthly rise. This report supported ideas the Euro zone collective economy is on the mend, albeit slowly. Japan’s Nikkei stock index was down again Wednesday and is now off around 16% from its high scored last month. The markets in China were closed for a public holiday Wednesday. A recent theme in the market place worldwide has been falling bond market prices (rising yields). A German bond auction Wednesday produced the highest yield since February. U.S. Treasury yields are also at multi-month highs.

Another theme that has just developed recently is weakening periphery, or emerging market currencies. The Indian rupee, Thailand baht and Malaysian ringgit are all under serious selling pressure this week. U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the weekly DOE energy stocks report, the monthly Treasury budget statement, and the World Bank’s global economic prospects report.

US Dollar Index

The September U.S. dollar index is firmer in early U.S. trading, on short covering. Bulls have faded badly recently. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at the overnight high of 81.510 and then at 81.750. Shorter-term support is seen at Tuesday’s low of 81.230 and then at 81.000. Wyckoff's Intra Day Market Rating: 5.5

NYMEX Crude Oil

Crude oil prices are near steady early today. Not much new. Bulls and bears are still on a level near-term technical playing field amid choppy trading recently. In July Nymex crude, look for buy stops to reside just above resistance at $96.00 and then at last week’s high of $96.39. Look for sell stops just below technical support at $95.00 and then at the overnight low of $94.46. Wyckoff's Intra-Day Market Rating: 5.0

Grains

Markets were mixed in overnight trading, on some position evening ahead of the late-morning USDA monthly supply and demand report due out Wednesday. This particular report is not expected to be a big markets mover. Soybean bulls still have near-term technical momentum. Corn trading remains
choppy. Wheat bears remain in technical control. Weather in the U.S. Corn Belt will remain a dominant fundamental factor for the grains in the near term, although it has turned more benign this week. The grain market bears did take note of a report Wednesday that said Goldman Sachs has predicted lower grain market prices in the second half of 2013.

TheCropSite News Desk

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.



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