Overnight Report 7/19/2018
-Commodities continue to underperform which is not a good sign for the global economy (GC -12 YTD low x 1215, Crude -0.8).
-Australia added 50k fulltime workers which was better than expected but weak commodity markets have dragged AUSI lower .7350
-GBP is lower and below 1.30 for the first time this year following more BREXIT talk and weaker retail sales.
-USD much stronger across the board especially EM where ZAR -1.5%, MXN -1%, TRY -1%.
-Equities lower across the board as we get started, Asia was down roughly -0.5%, ES -9, NQ -26, Dax -0.5%.
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World stock markets were mostly lower overnight. U.S. stock indexes are pointed toward weaker openings when the New York day session begins, on some mild profit taking after scoring multi-month or contracts highs this week.
The U.S. hard line against its trading partners is back on the front burner of the marketplace and is pressuring world equity markets Thursday. President Trump has again threatened the European Union with tariffs on its automobiles. The Chinese yuan declined to a 12-month low against the U.S. dollar today amid expectations that Chinese monetary officials will continue to let the yuan depreciate, including by easing China’s monetary policy.
Gold and silver prices slumped to 12-month lows overnight, with gold closing in on $1,200.00 and silver nearing $15.00. While there are no significant, early chart clues these metals are near a bottom, they are short-term oversold, technically, and due for a corrective bounce very soon.
The key “outside markets” today find Nymex crude oil prices lower and trading around $68.00 a barrel. Recent solid losses in crude suggest this market has topped out. Meantime, the U.S. dollar index is higher today and hit a fresh 12-month high.
U.S. economic data due for release Thursday includes the weekly jobless claims report, the Philadelphia Fed business survey, and leading economic indicators.

U.S. STOCK INDEXES

September S&P 500 e-mini futures: Prices are lower in early U.S. trading, on profit taking after hitting a five-month high Wednesday. The bulls still have the firm overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Today, shorter-term technical resistance comes in at this week’s high of 2,818.25 and then at 2,840.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at this week’s low of 2,789.75 and then at 2,773.00. Sell stops are likely located just below those levels.

September Nasdaq index December futures: Prices are lower on mild profit taking after hitting a contract high Wednesday. Bulls have the solid overall near-term technical advantage. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at the overnight high of 7,416.00 and then at the contract high of 7,437.75. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 7,350.00 and then at 7,300.00. Sell stops are likely located just below those levels.

U.S. TREASURY BONDS AND NOTES

September U.S. T-Bonds: Prices are weaker and hit a three-week low in early U.S. trading. 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 bearish early today. Shorter-term technical resistance is seen at the overnight high of 144 27/32 and then at 145 even. Buy stops likely reside just above those levels. Shorter-term support lies at the overnight low of 144 12/32 and then at 144 even. Sell stops likely reside just below those levels.
September U.S. T-Notes: Prices are lower and hit a three-week low in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are bearish early today. The 4-day moving average is below the 9-day. The 9-day is below the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 120.03.0 and then at Wednesday’s high of 120.08.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 119.27.5 and then at 119.24.0. Sell stops likely reside just below those levels.

U.S. DOLLAR INDEX

The September U.S. dollar index is higher and hit a contract high in early U.S. trading. Bulls have the solid overall near-term technical advantage. The shorter-term moving averages for the dollar index are neutral early today, as the 4-day is above the 9-day. The 9-day is even with the 18-day moving average. Short-term oscillators for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at the overnight contract high of 95.285 and then at 95.500. Shorter-term support is seen at the 95.000 and then at the overnight low of 94.750.

NYMEX CRUDE OIL

August Nymex crude oil prices are lower in early U.S. trading. Recent downside price action suggests a market top is in place. The shorter-term moving averages are bearish early today as the 4-day is below the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bearish early today. Look for buy stops to reside just above technical resistance at $68.00 and then at $69.00. Look for sell stops just below technical support at this week’s low of $67.03 and then at $66.00.
GRAINS

Grain futures prices were mixed in overnight trading. Focus today will be on the weekly USDA export sales report. Corn and soybean market bears remain in firm technical command. Wheat has stabilized on ideas of a shorter world wheat crop this year. Bulls need a weather market in the grains, but the clock is ticking on such developing in the U.S. Corn Belt this year.