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Jim Wyckoff's Morning Report: Quiet Asian, European Markets Overnight

13 September 2013
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - It was generally quiet in Asian and European markets overnight, except the gold and silver markets, which saw solid follow-through selling pressure from Thursday’s strong losses.

The perceived decreasing odds of U.S. military action against the Syrian regime continue to pressure safe- haven gold. Many traders and investors this week have been looking ahead to next week’s meeting of the U.S. Federal Reserve’s Open Market Committee (FOMC). A majority of the market place believes the U.S. central bank at next week’s meeting will announce it will begin to scale back, or “taper” its monthly bond-buying program. Some reckon the Fed will announce a $10 billion or $15 billion reduction in its $85 billion-a-month bond-buying program. The surprise to the markets could be if the Fed either does nothing at this meeting, or is more aggressive in its initial reduction in bond purchases. For the past several weeks the market place has been fixated on what the U.S. central bank will announce at the conclusion of next week’s FOMC meeting. The Japanese Nikkei news service reported overnight that President Obama late next week will name Larry Summers as the next chairman of the Federal Reserve. The U.S. dollar index rallied modestly on this report, while gold saw some added selling pressure—on notions Summers as a Fed chairman would be more hawkish on U.S. monetary policy than would present Fed vice chair Janet Yellen. U.S. economic data due for release Friday includes the producer price index, retail sales, manufacturing and trade inventories, and the University of Michigan consumer sentiment survey.

US Dollar Index

The September U.S. dollar index is firmer early today. Bulls and bears are on an overall level near-term technical playing field. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 81.915 and then at 82.000. Shorter-term support is seen at the overnight low of 81.695 and then at this week’s low of 81.520. Wyckoff's Intra Day Market Rating: 5.0

NYMEX Crude Oil

October Nymex crude oil prices are lower early today. Crude oil bulls still have the overall near-term technical advantage. Prices are in a five-month-old uptrend on the daily bar chart. In October Nymex crude, look for buy stops to reside just above resistance at $108.00 and then at the overnight high of $108.74. Look for sell stops just below technical support at the overnight low of $107.31 and then at $107.00. Wyckoff's Intra-Day Market Rating: 4.0

Grains

Markets were mostly weaker overnight. With Thursday’s USDA monthly supply and demand report digested and out of the way, focus will now turn to early yield reports on the harvesting of the U.S. corn and soybean crops in the Corn Belt—and on any fresh export demand for U.S. grains. Soybean bulls have the solid near-term technical advantage. Corn and wheat bears remain in firm technical command. My bias remains that while corn is still fully technically bearish, the price downside is limited at the present low levels.

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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