Overnight Recap 1/10/2019


European and Asian stock markets were mostly lower overnight. U.S. stock indexes are pointed toward lower openings when the New York day session begins. The global indexes are experiencing normal downside corrections today, following recent good gains.

The Wednesday afternoon release of the minutes from the last meeting of the Federal Reserve’s Open Market Committee (FOMC) were deemed as favoring the dovish side of monetary policy, which helped to drop the U.S. dollar index to a 2.5-month low on Wednesday. Two Fed officials on Wednesday also suggested there may not be further interest rate cuts in 2019. Federal Reserve Chairman Jerome Powell speaks to the Economic Club of Washington, D.C. at midday today. Several other Federal Reserve officials also are on tap for speeches today.

The USDX is seeing a mild corrective bounce Thursday morning, but has been trending sideways to lower on the daily chart for the past month. Meantime, Nymex crude oil prices are weaker and trading just above $52.00 a barrel level. Technical evidence is building the oil market will trade at least sideways in the coming weeks, if not sideways to higher.

U.S. economic data due for release Thursday includes the weekly jobless claims report, monthly wholesale trade, and monthly chain store sales.

U.S. STOCK INDEXES

March S&P 500 e-mini futures: Prices are weaker in early U.S. trading today, on a normal pullback after hitting a three-week high Wednesday. There are chart clues the index has put in a bottom. 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 Wednesday’s high of 2,596.75 and then at 2,625.00. Buy stops likely reside just above those levels. Downside support for active traders today is located at Tuesday’s low of 2,547.50 and then at this week’s low of 2,523.25. Sell stops are likely located just below those levels.

March Nasdaq index December futures: Prices are lower in early U.S. trading, on a corrective pullback after hitting a three-week high Wednesday. There are technical clues the index has bottomed out. 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 early today. Shorter-term technical resistance is seen at the overnight high of 6,604.50 and then at Wednesday’s high of 6,645.00. Buy stops likely reside just above those levels. On the downside, short-term support is seen at 6,500.00 and then at 6,450.00. Sell stops are likely located just below those levels.

U.S. TREASURY BONDS AND NOTES FUTURES

March U.S. T-Bonds: Prices are higher in early U.S. trading today. Bulls are still in firm near-term technical control. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the overnight high of 146 10/32 and then at 147 even. Buy stops likely reside just above those levels. Shorter-term support lies at this week’s low of 145 11/32 and then at 145 even. Sell stops likely reside just below those levels.

March U.S. T-Notes: Prices are higher in early U.S. trading. Bulls still have the firm chart advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at the overnight high of 122.03.5 and then at 122.10.0. Buy stops likely reside just above those levels. Shorter-term technical support lies at the overnight low of 121.24.5 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 higher in early U.S. trading, on a mild rebound after hitting a 2.5-month low on Wednesday. The bulls are fading and prices have been trending lower on the daily chart for the past month. 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 95.000 and then at 95.200. Shorter-term support is seen at this week’s low of 94.635 and then at 94.500.

NYMEX CRUDE OIL

February Nymex crude oil prices are weaker on a corrective pullback after hitting a three-week high of $52.58 on Wednesday. Strong longer-term technical support at the $42.00 area appears to have put in a market bottom. The shorter-term moving averages are bullish early today as the 4-day is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral to bullish early today. Look for buy stops to reside just above technical resistance at this week’s high of $52.58 and then at $53.00. Look for sell stops just below technical support at $51.00 and then at $50.00.

GRAINS

Grain futures were mostly weaker overnight. The U.S. government closure is creating a dearth of fresh fundamental news for the grain markets, to prompt quieter trading. Rising oil prices are a bullish element for grains and the rest of the raw commodity sector.