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Jim Wyckoff's Morning Report: Risk-averse Mood in Market Place

Jim Wyckoff's Morning Report: Risk-averse Mood in Market Place

16 September 2014
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - The December NASDAQ 100 was lower overnight as investors have moved into a risk-averse mood ahead of the Federal Open Market meeting.

Investors are concerned that the Fed will deliver a hawkish speech on interest rates in the upcoming meeting signaling a rise in interest rates. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near-term.

If December extends this week's decline, the 25% retracement level of the April-September-rally crossing at 3936.66 is the next downside target. Closes above the 10-day moving average crossing at 4062.25 would temper the near-term bearish outlook. First resistance is the 10-day moving average crossing at 4062.25. Second resistance is this month's high crossing at 4106.00. First support is the 25% retracement level of the April-September-rally crossing at 3936.66. Second support is 38% retracement level of the April-September-rally crossing at 3843.79

The December S&P 500 was lower overnight as it extends the decline off this month's high. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near-term. If December extends this month's decline, the reaction low crossing at 1930.20 is the next downside target.

Closes above the 10-day moving average crossing at 1985.54 are needed to confirm that a short-term top has been posted. First resistance is the 10-day moving average crossing at 1985.54. Second resistance is this month's high crossing at 2000.00. First support is Monday's low crossing at 1969.00. Second support is the reaction low crossing at 1930.20.

INTEREST RATES

December T-bonds were higher due to short covering overnight as they consolidated some of the decline off August's high. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If December extends the decline off August's high, the 50% retracement level of the March-August-rally crossing at 135-21 is the next downside target.

Closes above the 20-day moving average crossing at 138-08 are needed to confirm that a low has been posted. First resistance is the 20-day moving average crossing at 138-08. Second resistance is August's high crossing at 141-16. First support is last Friday's low crossing at 135-25. Second support is the 50% retracement level of the March-August-rally crossing at 135-21.

ENERGY MARKETS

ENERGY MARKETS: October Nymex crude oil was slightly lower overnight following Monday's upside reversal off support marked by the 38% retracement level of the 2009-2011-rally crossing at 90.62. Stochastics and the RSI are neutral to bullish hinting that a low might be in or is near.

Closes above the 20-day moving average crossing at 93.47 are needed to confirm that a short-term low has been posted. If October resumes the decline off June's high, the 50% retracement level of the 2009-2011-rally crossing at 85.64 is the next downside target. First resistance is the reaction high crossing at 96.00. Second resistance is the reaction high crossing at 97.75. First support is the 38% retracement level of the 2009-2011-rally crossing at 90.62. Second support is the 50% retracement level of the 2009-2011-rally crossing at 85.64.

CURRENCIES

The December Dollar was slightly lower overnight as it extends the trading range of the past six-days. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If December renews this year's rally, weekly resistance crossing at 84.96 is the next upside target.

Closes below the 20-day moving average crossing at 83.37 would confirm that a short-term top has been posted. First resistance is last Tuesday's high crossing at 84.65. Second resistance is weekly resistance crossing at 84.96. First support is the 10-day moving average crossing at 84.16. Second support is the 20-day moving average crossing at 83.37.

GRAINS

December corn was higher due to short covering overnight and trading above the 10-day moving average crossing at 3.46 1/2. While the weekend frost event appears to have cause limited damage, we are seeing some bargain hunting buying surface. U.S. corn's rating was unchanged from a week ago at 74% good to excellent and 4% of the crop was harvested. The harvest pace matched last year's pace but trails the 9% five-year average.

Stochastics and the RSI are turning neutral to bullish signaling that a short covering bounce is possible before corn harvest begins in earnest later this month. Closes above the 20-day moving average crossing at 3.57 are needed to confirm that a short-term low has been posted.

If December extends the decline off May's high, monthly support crossing at 3.24 1/2 is the next downside target. First resistance is the 20-day moving average crossing at 3.57. Second resistance is the reaction high crossing at 3.70. First support is last Thursday's low crossing at 3.35 3/4. Second support is monthly support crossing at 3.24 1/2.

December wheat was higher due to short covering overnight as it consolidates some of this year's decline. The high-range close sets the stage for a steady to higher opening when the day session begins trading. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term.

If December extends the aforementioned decline, monthly support crossing at 4.91 1/4 is the next downside target. Closes above the 20-day moving average crossing at 5.39 1/2 are needed to confirm that a low has been posted. First resistance is the 10-day moving average crossing at 5.20 1/4. Second resistance is the 20-day moving average crossing at 5.39 1/2. First support is Monday's low crossing at 4.96. Second support is monthly support crossing at 4.91 1/4.

November soybeans was higher due to short covering overnight as it consolidates some of this summer's decline. The high-range close sets the stage for a steady to lower opening when the day session begins trading. Stochastics and the RSI are neutral to bullish hinting that a short-term low might be in or is near.

Closes above the 20-day moving average crossing at 10.16 1/2 are needed to confirm that a low has been posted. If November resumes this summer's decline, monthly support crossing at 9.30 1/2 is the next downside target. First resistance is the 20-day moving average crossing at 10.16 1/2. Second resistance is the reaction high crossing at 10.38. First support is last Thursday's low crossing at 9.69 1/2. Second support is monthly support crossing at 9.30 1/2.

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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