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Jim Wyckoff's Morning Report: How Damaged are US-Russia Relations?

Jim Wyckoff's Morning Report: How Damaged are US-Russia Relations?

22 July 2014
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - There is a bit more investor and trader risk appetite in the market place Tuesday, as U.S. and some other major world stock indexes traded higher.

However, geopolitics remains on the front burner of the market place. Tensions in Israel and Ukraine remain high. Pundits are now saying the U.S.-Russia relations have deteriorated to Cold War levels.

Gold, U.S. Treasuries and the U.S. dollar are safe-haven assets that have been supported from the heightened world tensions. I suspect that for the near term, trading action in many markets will day to day swing from risk-on to risk-off, depending on the news headlines of that day.

It’s a busier day for U.S. economic data Tuesday, which could impact the market place. Data due out includes the weekly Johnson Redbook and Goldman Sachs retail sales reports, the consumer price index, real earnings, the monthly U.S. house price index, existing home sales and the Richmond Fed business survey. The consumer price index is likely to be the most likely to move the markets Tuesday.

Wyckoff’s Daily Risk Rating: 7.0 (Russia-Ukraine crisis and Irael-Hamas conflict are still front-burner matters for 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 September e-mini futures: Prices are firmer in early trading and hovering near the recent record high. The shorter-term moving averages (4-, 9- and 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. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at the record high of 1,978.25 and then at 1,990.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 1,965.25 and then at Monday’s low of 1,959.00. Sell stops are likely located just below those levels. Wyckoff's Intra-day Market Rating: 6.0

Nasdaq index futures: Prices are higher in early trading today and are near the recent 14-year high. 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 bullish early today. Shorter-term technical resistance is seen at the recent 14-year high of 3,942.00 and then at 3,950.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 3,925.50 and then at Monday’s low of 3,911.00. Sell stops are likely located just below those levels. Wyckoff's Intra-Day Market Rating: 6.0.

Dow futures: Prices are firmer in early U.S. trading and hovering just below the record high. Buy stops likely reside just above technical the record high of 17,080 and then at 17,100. Sell stops likely reside just below technical support at 17,000 and then at 16,950.

Shorter-term moving averages are bullish early today, as the 4-day moving average is above the 9-day. The 9-day moving average is above the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Wyckoff's Intra-Day Market Rating: 6.0

U.S. TREASURY BONDS AND NOTES

September U.S. T-Bonds: Prices are lower early today. Bulls still have the firm overall near-term technical advantage on safe-haven demand. Shorter-term moving averages (4- 9- 18-day) are bullish early today.

The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term resistance lies at the overnight contract high of 138 16/32 and then at the contract high of 138 27/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at 138 even and then at 137 23/32. Sell stops likely reside just below those levels. Wyckoff's Intra-Day Market Rating: 4.5

September U.S. T-Notes: Prices are weaker in early trading. Bulls still have the firm overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today.

Shorter-term resistance lies at the overnight high of 125.10.5 and then at Monday’s high of 125.16.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at 125.00.0 and then at 124.24.0. Sell stops likely reside just below those levels. Wyckoff's Intra-Day Market Rating: 4.0

U.S. DOLLAR INDEX

The September U.S. dollar index is higher in early trading and hit a five week high overnight. Bulls have upside momentum on their side. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at the overnight high of 80.840 and then at 80.880. Shorter-term support is seen at the overnight low of 80.610 and then at Monday’s low of 80.490. Wyckoff's Intra Day Market Rating: 6.0

NYMEX CRUDE OIL

September Nymex crude oil prices are firmer in early U.S. trading and hit a two-week high overnight. Bulls have some upside momentum. In September Nymex crude, look for buy stops to reside just above resistance at the overnight high of $103.45 and then at $104.00. Look for sell stops just below technical support at the overnight low of $102.66 and then at $102.00. Wyckoff's Intra-Day Market Rating: 5.5

GRAINS

Markets were steady to firmer in overnight trading on tepid short covering in bear markets. Weekly USDA crop progress reports on Monday showed what most expected: very good corn and soybean crop conditions, overall.

There continues to be talk of record corn and soybean yields this year. While some very hot weather will pervade the U.S. Corn Belt for another day, it’s not threatening to the crop. Bears also remain in firm technical command of the grain futures markets, and gained fresh downside momentum with Monday’s losses.

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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