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Jim Wyckoff's Morning Report: Notions Receding that US will Attack Syrian Regime

10 September 2013
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - Notions are receding that the US will attack the Syrian regime over its alleged use of chemical weapons. Russia has put forth a plan to put Syria’s chemical weapons under international control. President Obama said the plan could avoid a US strike on Syria.

U.S. citizens are also becoming less and less in favor of a U.S. military operation against Syria’s regime. This development has increased investor risk appetite in the market place—to the detriment
of safe-haven assets like gold and U.S. Treasuries.

On the economic front, China’s industrial output rose by 10.4% on an annual basis in August, which beat market expectations of a 9.9% gain. China’s retail sales also beat forecasts and were up 13.4% in August, year on year. This adds to a string of generally upbeat economic data coming out of China and Asia. Such is an underlying bullish factor for the raw commodity sector. Reports Tuesday said gold imports to India fell by more than 90% during August, year on year, due to
government-imposed import taxes. Traders and investors are looking ahead to next week’s meeting of the U.S. Federal Reserve’s Open Market Committee (FOMC). A slight majority of the market place believes the U.S. central bank at next week’s meeting will announce it will begin to scale back, or
“taper” its monthly bond-buying program. For the past several weeks the market place has been fixated on what the U.S. central bank will announce at the conclusion of next week’s FOMC meeting. U.S. economic data due for release Tuesday includes the Manpower quarterly U.S. employment outlook survey, the NFIB small business index, and the Johnson Redbook and Goldman Sachs weekly retail sales reports.

US Dollar Index

The September U.S. dollar index is slightly higher early today. Bulls and bears are on an overall level near-term technical playing field as the bulls have faded just recently. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at 82.260 and then at 82.500. Shorter-term support is seen at Monday’s low of 81.905 and then at 81.750. Wyckoff's Intra Day Market Rating: 5.5

NYMEX Crude Oil

October Nymex crude oil prices are sharply lower early today, on a corrective pullback from recent gains and on lessening odds of a U.S. military attack on Syria’s regime.

Crude oil bulls still have the overall near-term technical advantage. In October Nymex crude, look for buy stops to reside just above resistance at $108.00 and then at $109.00. Look for sell stops just below technical support at $107.00 and then at $106.00. Wyckoff's Intra-Day Market Rating: 3.5.

Grains

Markets were mostly weaker overnight. Soybean bulls are maintaining their technical advantage. Corn and wheat bears remain in firm technical command. While the weather forecasts for the U.S. Corn Belt call for very warm and dry conditions in the region in the next couple days, it appears the late-summer weather market has played out in the grain futures markets. It appears yield damage to the crops has already been mostly factored into present prices.

For grain market prices to gain more upside in the near term, some new fundamental news will have to occur. Focus is on Thursday morning’s USDA monthly supply and demand report, at which time updated corn and soybean production forecasts will be given by USDA.

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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