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Jim Wyckoff's Morning Report: Markets Firmer Overnight

30 July 2013
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - Asian and European stock markets were firmer overnight in subdued trading, as key worldwide economic data points are approaching fast.

The highlights this week are the U.S. Federal Reserve’s FOMC meeting that begins Tuesday and the U.S. employment report Friday. Most expect the Fed will leave its monetary policy unchanged and continue to lean well to the dovish side at this week’s meeting.

Many Fed watchers are actually looking ahead to the next FOMC meeting, in September, at which time the central bank could begin its much-anticipated “tapering” of its monthly bond-buying program, also called quantitative easing.

For the U.S. jobs report, the key non-farm payrolls figure is forecast to rise by around 175,000 workers in July.

The overall unemployment rate is expected to have declined by 0.1%, to 7.5%. The U.S. gross domestic product reading for the second quarter will also be released Wednesday.

European traders are awaiting the European Central Bank and Bank of England monthly meetings that occur on Thursday.

Asian traders and investors are awaiting manufacturing data from China, due out Thursday. The European Union did see its overall consumer confidence rise to the highest level in over a year, it was reported Tuesday.

At present, the EU sovereign debt problems are pushed to the back burner of the market place, but have not just disappeared. U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the S&P/Case-Shiller home price index, and the consumer confidence index.--Jim

U.S. Dollar Index

The September U.S. dollar index is slightly higher in early U.S. trading. Bears have the overall near-term technical advantage. Slow stochastics for the dollar index are neutral early today.

The dollar index finds shorter-term technical resistance at the overnight high of 81.940 and then at
82.000. Shorter-term support is seen at Monday’s low of 81.610 and then at 81.500. Wyckoff's Intra Day Market Rating: 5.0

NYMEX Crude Oil

Crude oil prices are lower early today and hit a fresh three-week low overnight. Bulls still have the overall near-term technical advantage but have faded.

In September Nymex crude, look for buy stops to reside just above resistance at the overnight high of $104.54 and then at $105.00. Look for sell stops just below technical support at the overnight low of $103.56 and then at $103.00. Wyckoff's Intra-Day Market Rating: 4.0

Grains

Markets were firmer in overnight trading, on short covering following recent selling pressure. However, the grain market bears are still on the prowl and have near-term power.

The U.S. Corn Belt weather has turned non-threatening for the corn and corn and soybean crops and that’s bearish. Cash basis levels for corn and soybeans have also weakened significantly. The important outside market events that occur this week could have a significant impact on grain prices—the FOMC data and jobs report.

TheCropSite News Desk

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