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

News

Jim Wyckoff's Morning Report: Markets 'Lethargic' Through Summer

Jim Wyckoff's Morning Report: Markets 'Lethargic' Through Summer

05 August 2014
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - The “dog days” of summer are approaching and with much of Europe on vacation during August, the market place feels a bit lethargic at present.

Many traders and investors are more focused on family vacations and other outdoor activities on this last unofficial month of summer in the West.

In overnight news, there was some downbeat economic data coming out of China. The HSBC China services purchasing managers index (PMI) fell to 50.0 in July from 53.1 in June. That was the lowest reading in the nine year history of this particular index. A reading over 50.0 suggests expansion and a reading under 50.0 suggests contraction. The Asian stock markets were pressured on the news.

Meantime, in the European Union, retail sales for the bloc rose 0.4% in June from May-- the fastest pace since 2007. The Markit data firm reported the EU’s composite PMI came in at 53.8 in July from 52.8 in June. That reading was as bit weaker than expected.

U.S. economic data due for release Tuesday is substantial and includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the U.S. services purchasing managers index (PMI), manufacturers’ shipments and inventories, the global services PMI, the ISM non-manufacturing report, and the IBD/TIPP economic optimism index.

Wyckoff’s Daily Risk Rating: 6.0 (The market place is focused on other things besides the still-simmering geopolitical matters.)

(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 slightly lower in early trading and trying to recovery after hitting a two-month low last Friday. Bulls have faded. The shorter-term moving averages (4-, 9- and 18-day) are bearish early today. The 4-day moving average is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral early today. Today, shorter-term technical resistance comes in at Monday’s high of 1,937.50 and then at 1,942.50. Buy stops likely reside just above those levels. Downside support for active traders today is located at Monday’s low of 1,915.75 and then at last week’s low of 1,910.25. Sell stops are likely located just below those levels. Wyckoff's Intra-day Market Rating: 4.5

Nasdaq index futures: Prices are weaker in early trading today. Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is below the 9-day and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at 3,900.00 and then at Monday’s high of 3,916.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at Monday’s low of 3,871.00 and then at last week’s low of 3,855.00. Sell stops are likely located just below those levels. Wyckoff's Intra-Day Market Rating: 4.5.

Dow futures: Prices are weaker in early U.S. trading, and trying to recover from hitting a 2.5-month low last Friday. Bulls have faded recently. Buy stops likely reside just above technical resistance at Monday’s high of 16,520 and then at 16,550. Sell stops likely reside just below technical support at 16,400 and then at last week’s low of 16,374. Shorter-term moving averages are bearish early today, as the 4-day moving average is below the 9-day and 18-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: 4.5

U.S. TREASURY BONDS AND NOTES

September U.S. T-Bonds: Prices are near steady early today. Bulls 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 and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term resistance lies at the overnight high of 138 11/32 and then at Monday’s high of 138 16/32. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 138 even and then at 137 28/32. Sell stops likely reside just below those levels. Wyckoff's Intra-Day Market Rating: 5.0

September U.S. T-Notes: Prices are near steady in early trading. Bulls have the slight overall near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term resistance lies at the overnight high of 126.17.5 and then at the July high of 125.23.5. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 125.09.0 and then at Monday’s low of 125.05.5. Sell stops likely reside just below those levels. Wyckoff's Intra-Day Market Rating: 5.0

U.S. DOLLAR INDEX

The September U.S. dollar index is higher in early trading and hovering near last week’s nearly six-month high. Bulls still have upside momentum. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at last week’s high of 81.660 and then at 81.750. Shorter-term support is seen at Monday’s low of 81.360 and then at 81.265 Wyckoff's Intra Day Market Rating: 6.0

NYMEX CRUDE OIL

September Nymex crude oil prices are slightly firmer in early U.S. trading on short covering after hitting a nearly three-month low last Friday. Bears still have the overall near-term technical advantage. In September 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 $97.50. Wyckoff's Intra-Day Market Rating: 5.0

GRAINS

Markets were weaker in overnight trading. Extended weather forecasts are still non-threatening to the corn and soybean crops. However, there are some dry spots in the western Corn Belt. Still, U.S. corn and soybean crops are on pace to have record yields this year. Grain market bears continue have the solid overall near-term technical advantage, which means the path of least resistance for prices will remain sideways to lower in the near term.

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