TheCropSite.com- news, features, articles and disease information for the crop industry

News

Jim Wyckoff's Morning Report: Markets Mostly Higher Overnight

23 January 2014
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - In overnight news, China’s flash purchasing managers index (PMI) fell to 49.6 in January from 50.5 in December—the lowest reading in six months.

A PMI reading below 50.0 suggests contraction in the manufacturing sector. This news pressured Asian stock markets and to a lesser degree European stocks.

Meantime, the data firm Markit on Thursday reported the European Union’s preliminary PMI came in at 53.2 in January from 52.1 in December—the best reading in two and one-half years. This latest economic data from the EU corroborates other recent data that suggests the bloc has pulled out of economic recession. Thursday’s report also hints the European Central Bank will not have to implement additional monetary stimulus measures.

U.S. economic data due for release Thursday includes the weekly jobless claims report, the Chicago Fed national activity index, the flash manufacturing PMI, the monthly house price index, leading economic indicators, existing home sales, the weekly DOE energy stocks report, and the Kansas City Fed manufacturing survey.

Wyckoff’s Daily Risk Rating: 6.5 (There is a heavy slate of U.S. economic data out Thursday that could move the markets.)

(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

U.S. STOCK INDEXES

S&P 500 futures: Prices are weaker in early U.S. trading on profit taking. Bulls remain in firm overall technical command. The shorter-term moving averages (4-, 9- and 18-day) are still 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 bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 1,843.50 and then at the record high of 1,846.50. Buy stops likely reside just above those levels. Downside support for active traders today is located at this week’s low of 1,827.20 and then at 1,817.50. Sell stops are likely located just below those levels. Wyckoff's Intra-day Market Rating: 4.5

Nasdaq index futures: Prices are weaker early today on profit taking after hitting another 14-year high overnight. 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 average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is located at the overnight high of 3,635.25 and then at 3,650.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 3,600.00 and then at this week’s low of 3,577.50. Sell stops are likely located just below those levels. Wyckoff's Intra-Day Market Rating: 4.5.

Dow futures: Prices are lower in early U.S. trading. Bulls are still in overall technical control. Buy stops likely reside just above technical resistance at 16,300 and then at Wednesday’s high of 16,345. Sell stops likely reside just below technical support at 16,200 and then at the January low of 16,185. Shorter-term moving averages are neutral early today, as the 4-day moving average is above the 9-day. The 9-day moving average is below the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are neutral early today. Wyckoff's Intra-Day Market Rating: 4.0

U.S. TREASURY BONDS AND NOTES

March U.S. T-Bonds: Prices are higher early today. The bulls have some upside near-term technical momentum. Shorter-term moving averages (4- 9- 18-day) are still bullish early today. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at this week’s high of 131 20/32 and then at 132 even. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 130 30/32 and then at this week’s low of 130 27/32. Sell stops likely reside just below those levels. Wyckoff's Intra-Day Market Rating: 4.5

March U.S. T-Notes: Prices are higher early today on short covering. Bears still have the overall 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. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at Wednesday’s high of 124.12.0 and then at this week’s high of 124.18.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at 124.00.0 and then at the overnight low of 123.27.0. Sell stops likely reside just below those levels. Wyckoff's Intra-Day Market Rating: 5.5

U.S. DOLLAR INDEX

The March U.S. dollar index is solidly lower early today and is scoring a bearish “outside day” down on the daily bar chart. Bulls are fading today. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at 81.000 and then at 81.250. Shorter-term support is seen at the overnight low of 80.895 and then at 80.750. Wyckoff's Intra Day Market Rating: 3.5

NYMEX CRUDE OIL

March Nymex crude oil prices are firmer early today and hit a three-week high on more short covering. Bulls have gained good upside near-term technical momentum recently. In March Nymex crude, look for buy stops to reside just above resistance at $97.50 and then at $98.00. Look for sell stops just below technical support at the overnight low of $96.41 and then at $96.00. Wyckoff's Intra-Day Market Rating: 5.5

GRAINS

Markets were mostly higher overnight on short covering and bargain hunting. Soybean bulls have faded this week amid beneficial rains and cooler temperatures reported in Argentina soybean regions. Corn bulls remain very weak amid a lack of fresh, bullish news. Wheat bears are also in full technical command amid slack export demand for U.S. wheat. The demand side of the equation for grains will continue to be a major market factor in the grain markets. Grain market bulls are also worried about the seasonal “February Break” phenomenon that seems to pressure the grain futures markets about this time every 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.



Our Sponsors

Partners


Seasonal Picks

Country Dance