Opportunistic Trader Overnight Recap 1/8/2019
Overnight Headlines:

– Positive signs from the first day of U.S.-China trade negotiations; Hopes of a trade deal boosting risk appetite
– Samsung guides Q4 results below estimates, warns of a weaker start in 2019

European stock markets were mostly higher overnight, but Asian shares were slightly down. U.S. stock indexes are pointed toward higher openings when the New York day session begins. Traders and investors have keener “risk-on” attitudes the first full week of the new year. Perceived progress on U.S.-China trade talks presently taking place in Beijing, ideas of a more dovish Federal Reserve monetary policy in 2019, and a solid U.S. jobs report last week have perked up the marketplace so far this week.

The upbeat attitudes in Asia were somewhat dented today after technology giant Samsung said its fourth-quarter profits will drop 29% due to “mounting macro uncertainties.” The downbeat Samsung news follows a dour outlook issued by Apple last week.

The U.S. government shutdown is into its third week, but the matter is garnering less attention from the marketplace and is not a front-burner issue. President Trump will address U.S. citizens in a speech on a U.S. southern border wall Tuesday evening.

The key outside markets today see the U.S. dollar index higher on a corrective bounce after hitting a two-month low on Monday. The USDX has been trending sideways to lower on the daily chart for three weeks. Meantime, Nymex crude oil prices are higher and trading just above $49.00 a barrel. There are chart clues the oil market has bottomed out, but the bulls still have heavy lifting to do to suggest a price uptrend can be sustained.

U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales report, the NFIB small business optimism index, the international trade report (not issued because of government shutdown), and the World Bank global economic prospects report.

U.S. STOCK INDEXES

March S&P 500 e-mini futures: Prices are higher in early U.S. trading today and hit a three-week high overnight. There are early chart clues the index has put in a bottom. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at 2,585.00 and then at 2,600.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at the overnight low of 2,549.25 and then at Monday’s low of 2,523.25. Sell stops are likely located just below those levels.

March Nasdaq index December futures: Prices are higher in early U.S. trading and hit a three-week high overnight. There are early technical clues the index has bottomed out.
Shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at 6,600.00 and then at 6,650.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at the overnight low of 6,491.00 and then at Monday’s low of 6,402.50. Sell stops are likely located just below those levels.

U.S. TREASURY BONDS AND NOTES FUTURES

March U.S. T-Bonds: Prices are weaker in early U.S. trading today, on profit taking from recent good gains. Prices last Friday hit a contract high. Bulls are still in firm near-term technical control. Shorter-term moving averages (4- 9- 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. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at 147 even and then at Monday’s high of 147 17/32. Buy stops likely reside just above those levels. Shorter-term support lies at 146 even and then at 145 16/32. Sell stops likely reside just below those levels.

March U.S. T-Notes: Prices are lower in early U.S. trading, on profit taking after hitting a contract high last Thursday. Bulls still have the firm chart advantage. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at the overnight high of 122.01.5 and then at 122.08.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at 121.24.0 and then at 121.20.0. Sell stops likely reside just below those levels.

U.S. DOLLAR INDEX

The March U.S. dollar index is slightly up in early U.S. trading. The bulls are fading as prices hit a two-month low Monday and have been trending lower on the daily chart for three weeks. The shorter-term moving averages for the dollar index 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 for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at the overnight high of 95.535 and then at Monday’s high of 95.730. Shorter-term support is seen at Monday’s low of 95.195 and then at 95.000.

NYMEX CRUDE OIL

February Nymex crude oil prices are higher in early U.S. trading. Strong longer-term technical support at the $42.00 area appears to have put in a market bottom. The shorter-term moving averages are neutral early today as the 4-day is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bullish early today. Look for buy stops to reside just above technical resistance at Monday’s high of $49.79 and then at $50.00. Look for sell stops just below technical support at the overnight low of $48.31 and then at $47.50.
GRAINS

Grain futures were firmer overnight. There are increasing hopes the U.S. and China will reach a trade deal in the coming weeks, which is supporting gains in the grains. Rising oil prices are also bullish for grains and the rest of the raw commodity sector.