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Jim Wyckoff's Morning Report: Markets Firmer Overnight

10 October 2013
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - There is a general “risk-on” attitude in the market place Thursday morning as there is some hope that Democrats and Republicans in the U.S. Congress can very soon agree on a budget/debt ceiling plan that would reopen the partially closed government and raise its borrowing limit.

Reports overnight said President Obama will meet with U.S. House Republican members Thursday.

Many markets also could be posting a slightly delayed bullish reaction to the news Wednesday that President Obama nominated Janet Yellen to succeed Ben Bernanke as chairman of the Federal Reserve.

She is expected to be easily confirmed by the U.S. Congress. Yellen is perceived by the market place to be a monetary policy “dove.”

Wednesday afternoon’s release of the latest FOMC minutes from the Federal Reserve’s meeting last month has been quickly digested by the market place.

The minutes revealed a divisive committee, with the doves and hawks pleading their case. The committee expressed concern about shocks to the market place, including the U.S. budget impasse and looming debt ceiling.

The majority of the FOMC members also reckoned the Fed would begin to scale back its monthly bond-buying program yet this year.

However, that was before the U.S. government shutdown that has gripped the markets the past week.

Now, many Fed watchers believe “tapering” of U.S. quantitative easing will not begin until sometime in 2015.

U.S. economic data due for release Thursday includes the weekly jobless claims report and ICSC chain store sales trends.

The G-20 finance ministers and central bankers meeting gets under way Thursday in Washington.

Three U.S. Federal Reserve governors are scheduled to speak Thursday. FOMC minutes, the weekly MBA mortgage applications survey and the weekly DOE liquid energy stocks report.

Most U.S. government economic data is not being released due to the U.S. government closure.--Jim

U.S. Dollar Index

The December U.S. dollar index is near steady early today and pausing after the solid gains posted on Wednesdsay.

Bears remain in overall near-term technical command. Slow stochastics for the dollar index are bullish early today.

The dollar index finds shorter-term technical resistance at the overnight high of 80.685 and then at Wednesday’s high of 80.865.

Shorter-term support is seen at 80.285 and then at 80.000. Wyckoff's Intra Day Market Rating: 5.0

NYMEX Crude Oil

November Nymex crude oil prices are firmer early today. Bears have regained the overall near-term technical advantage.

Prices are in a six-week-old downtrend on the daily bar chart. In November Nymex crude, look for buy stops to reside just above resistance at $102.50 and then at $103.00.

Look for sell stops just below technical support at the overnight low of $101.39 and then at $101.00. Wyckoff's Intra-Day Market Rating: 5.5

Grains

Markets were firmer overnight on mostly short covering and the better risk appetite in the market place Thursday morning.

Harvest is at full speed in most areas of the Corn Belt and there are reports of better-than -expected yields for corn and soybeans coming from Iowa and Illinois, which is bearish.

With much of USDA still closed, there remains a lack of fresh fundamental news for grain traders to digest, and that also favors the bearish camp due.

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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