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Jim Wyckoff's Morning Report: Markets Lower in Overnight Trading

17 June 2013
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - Asian and European stock markets were mostly firmer Monday, but in a subdued atmosphere as the market place awaits the- two day meeting of the U.S. Federal Reserve’s Open Market Committee (FOMC), which begins Tuesday morning and concludes Wednesday afternoon.

Fed Chairman Ben Bernanke will also hold a press conference following the FOMC meeting. Traders and investors will be looking for fresh information from the Fed on when it will start to wind down its quantitative easing programs that have been in place for several years.

The Wall Street Journal reported last Friday it believes the Fed will gradually introduce its so-called “tapering” program and that interest rates will remain low for some time to come.

That report has given some fresh lift to the world stock markets, which have been flagging for the past month.

There is a Group of Eight meeting of the world’s major industrialized countries taking place in Ireland Monday. U.S. economic data due for release Monday includes the Empire State manufacturing survey and the NAHB housing market index.--Jim

US Dollar Index

The September U.S. dollar index is slightly higher in early U.S. trading, on short covering after hitting a four-month low last week.

Bears still have the near-term technical advantage. Slow stochastics for the dollar index are neutral early today.

The dollar index finds shorter-term technical resistance at the overnight high of 81.025 and then at 81.205. Shorter-term support is seen at last week’s low of 80.710 and then at 80.500. Wyckoff's Intra Day Market Rating: 5.5

NYMEX Crude Oil

Crude oil prices are higher early today and hit a fresh four-month high overnight. Bulls have gained upside momentum recently and have the overall near-term technical advantage.

In July Nymex crude, look for buy stops to reside just above resistance at $99.00 and then at $100.00.

Look for sell stops just below technical support at $98.00 and then at the overnight low of $97.38. Wyckoff's Intra-Day Market Rating: 6.0

Grains

Markets were lower in overnight trading. Traders will monitor Monday’s weekly USDA export inspections data.

Soybean bulls still have the overall near-term technical advantage. Corn and wheat bears have the near-term technical edge.

Weather in the U.S. Corn Belt is presently benign for the markets but will remain a dominant fundamental factor for the grains in the near term. It is my bias that another weather scare will develop in the grain markets in the coming weeks.

I have lived in Iowa all my life (the heart of the U.S. Corn Belt). In driving across the state during the weekend I have never seen such a high number of bare fields in mid-June, in which farmers were unable to get their crops in the ground.

The overall crop growth also looked mostly poor for this time of year.

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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