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Jim Wyckoff's Morning Report: Market Place Less Risk-averse Thursday

29 August 2013
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - The market place is a bit less risk-averse Thursday. Notions of an imminent U.S. military attack on Syria receded overnight as President Obama said Wednesday he has not decided on a response to the Syrian regime’s alleged use of chemical weapons against civilians.

Also, U.S. allies are not in agreement on what to do on the matter. There were no other major developments on the economic or geopolitical front overnight.

Traders and investors will focus on U.S. economic data due for release Thursday that includes weekly jobless claims and second-quarter gross domestic product.

The long U.S. Labor Day holiday weekend is approaching, so trading volumes in many markets Thursday and Friday are likely to dwindle.

However, once U.S. traders come back to work next Tuesday they will have a full plate of matters upon which to ponder. There is an FOMC meeting in September, at which time many believe the U.S. Fed will decided to change its monetary policy.

The important U.S. jobs report is out on Friday, September 6. The U.S. congress returns from its summer recess in mid-September and will immediately have to deal with pressing budget matters. And, it’s likely that President Obama early this fall will name a new Federal Reserve chairman.--Jim

U.S. Dollar Index

The September U.S. dollar index is solidly higher in early U.S. trading, on more short covering and some safe-haven buying.

Bulls have gained some fresh near-term technical momentum the past couple days. Slow stochastics for the dollar index are bullish early today.

The dollar index finds shorter-term technical resistance at 82.000 and then at 82.250. Shorter-term support is seen at 81.500 and then at the overnight low of 81.420. Wyckoff's Intra Day Market Rating: 6.0

NYMEX Crude Oil

October Nymex crude oil prices are lower early today on a corrective pullback after hitting a more than two-year high on Wednesday.

Crude bulls still have the solid overall near-term technical advantage. However, the bulls may have become exhausted with the big push higher in prices on Wednesday, given Wednesday’s low-range close.

In October Nymex crude, look for buy stops to reside just above resistance at $110.00 and then at $111.00. Look for sell stops just below technical support at the overnight low of $108.60 and then at $107.95. Wyckoff's Intra-Day Market Rating: 4.0

Grains

Markets were slightly lower overnight. The key “outside markets” are bearish for the grains early today as the U.S. dollar index is solidly higher and crude oil prices are lower.

There is still high heat and scant rain chances in the U.S. Corn Belt weather forecast for the next several days.

That is still bullish for soybeans and corn. Wheat remains overall technically bearish, but will follow corn and soybeans if those markets continue to rally.

How the corn and soybean markets close on Friday (near their weekly highs or near their weekly lows) will be a good clue on price direction in those markets in the coming weeks.

Closes near the weekly highs would suggest more upside price potential this fall. Closes near the weekly lows could strongly suggest near-term market tops are already in place.

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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