U.S. Equity Markets got hit hard yesterday, led by the 1.76% decline in the Dow, helping Bond Markets to have their largest one-day rally in many months. Russia remained in the headlines, though there was not much new information that came out yesterday. There were headlines regarding a convoy of Russian troops heading for Kyiv. Council of Economic Advisers Chairwoman Cecilia Rouse said the Russian invasion of Ukraine increases uncertainty for the domestic economic growth outlook. The continued uncertainty around the situation led investors to sell first and ask questions later, pushing markets lower. Economic data was strong, with the ISM Manufacturing Index for February rising and coming in above estimates. The release showed strength in orders, backlogs, and even a decline in pricing. This is a good sign that the economy is still humming along. Overnight, U.S. President Joe Biden gave his State of the Union address, where he is endorsed producing more goods domestically in order to strengthen supply chains and increase productivity. Biden also confirmed that the U.S will ban Russian flights from using U.S airspace as well as targeting Oligarchs by seizing their assets. Declines continued to outnumber the advances in the S&P 500. Financials were among the biggest laggards, as declining bond yields imply lower interest margins for banks. Semiconductor names tumbled on little news, dragging down tech shares. Target (TGT) was one of the bright spots, rising about 10% on a strong earnings report. Within the S&P 500, 10 of the 11 sectors finished lower. European Markets closed lower. European Union officials said the bloc will consider membership for Ukraine at an informal gathering in mid-March, but approval would likely take years. The International Energy Agency is set to hold an emergency meeting to discuss how the Russian invasion – and sanctions placed on the country – will impact energy supply. European Central Bank Governing Council member Ignazio Visco said it would guarantee ample liquidity and access to payment systems amid rising Russian financial concerns. In Asia, China’s official composite Purchasing Managers’ Index (“PMI”) data for February rose from January as manufacturing activity rebounded into expansion territory. Japanese Prime Minister Fumio Kishida nominated two Bank of Japan board members who are viewed as monetary-policy neutral, implying easy-money policies will remain intact. South Korea’s export figures for February were stronger than expected, as growth surged from January on steady semiconductor demand. Markit Taiwan’s manufacturing PMI numbers for February declined from January as New Orders fell to the lowest level since September. Elsewhere, Oil surged over 9% as the ongoing conflict in Europe threatened the energy supply, while Gold closed 2.47% higher as investors continued to flee risk assets for safe havens.
To mark my 2500th issue of TraderNoble Daily Commentary I am offering a special 2-Year Rate of Euro 2750 for my Platinum Service which includes 1 to 4 updated emails throughout the trading day to demonstrate this value, a monthly subscription over the same period would cost 4440 euro in total This offer represents a 38% discount and is open to both new and existing members. If anyone is interested in this offer can you please email me on bryan@tradernoble.com for details
For anyone following my Platinum Service it made 255 points yesterday, on the first trading session for March. The Platinum Service made an impressive 5324 points gain in February, after ending January with a gain of 3878 points, more than making up for December’s 932 points loss, having made 2466 points in November, 1028 points in October, 2866 points in September, 1543 points in August, and 996 points in July. The Platinum Service made 1366 points in June, 1439 points in May, 1244 points in April, after ending March with an impressive gain of 3769 points. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
Equities
The S&P 500 closed 1.55% lower at a price of 4306.
The Dow Jones Industrial Average closed 597 points lower for a 1.76% loss at a price of 33,294.
The NASDAQ 100 closed 1.63% lower at a price of 14,005.
The Stoxx Europe 600 Index closed 1.1% lower.
This morning, the MSCI Asia Pacific Index fell 0.9%.
This morning, the Nikkei closed 1.68% lower at a price of 26,393.
Currencies
The Bloomberg Dollar Spot Index closed 0.6% higher.
The Euro closed 0.8% lower at $1.1120.
The British Pound closed 1.2% lower at 1.3315.
The Japanese Yen rose 0.1%, closing at $114.95.
Bonds
Germany’s 10-year yield closed 17 basis points lower at -0.03%.
Britain’s 10-year yield closed 28 basis points lower at 1.10%.
US 10 Year Treasury closed 14 basis points lower at 1.73%.
Commodities
West Texas Intermediate crude closed 9.08% higher at 104.41 a barrel.
Gold closed 2.47% higher at $1,944.10 an ounce.
This morning on the Economic Front we have German Unemployment at 8.55 am, followed by speeches from ECB Members Schnabel and De Guindos at 10.00 am and 11.00 am respectively. Next, we have U.S. MBA Mortgage Applications at 12.00 pm and the ADP Employment Change at 1.15 pm. Fed Member Bullard speaks at 2.30 pm, ahead of Fed Chair Powell’s Testimony before Congress on Monetary Policy and the Economy at 3.00 pm. Finally, we have the Beige Book which will released at 7.00 pm.
Cash S&P 500
Initially my S&P plan worked well with the market trading the whole of my buy range for a 4355 average long position. Subsequently, I emailed my Platinum Members to exit any long position at my 4369 revised T/P level. Shortly after I sent this update the S&P got hit hard and is now trading over 100 Handles lower from where I marked prices 24 hours ago. Every chart that I follow is showing an oversold market from where we have witnessed strong rallies and is the main reason why I will not be short at this time. It will only take one positive headline from Ukraine before we see the start of a vicious rally that could well take the S&P back to 4600 as I mentioned yesterday. As long as the S&P does not close below 4265, I will continue to be a buyer of dips. This strategy worked really well in February. Yesterday afternoon’s aggressive sell-off saw the S&P hit my second buy level at 4320 as emailed to my Platinum Members. I am still long as the S&P just missed my 4330 T/P level which I will leave unchanged. If this level is triggered, I will be back with a new update for my Platinum Members.
EUR/USD
Rising Oil prices and a Bund Yield that is back in negative territory saw the Euro get hit hard yesterday, trading the whole of my buy range for a now 1.1150 average long position. The Euro is oversold but give the war risks I will leave my 1.1075 stop unchanged. I will now lower my T/P level to 1.1150 and if any of the above levels are hit, I will be back with a new update for my Platinum Members.
March Dollar Index
The rally in the Dollar saw the whole of my sell range triggered for a now 97.30 average short position. I will now raise my T/P level to 97.10 while continuing with no stop for now.
Cash DAX
My DAX plan did not work well as after buying the market at an average rate of 14220, I was stopped out of this trade at 14095 and I am still flat. This morning the DAX is trading lower at 13800. The DAX is oversold but the market needs to break back and close above 14200 for technicals to improve. The DAX has support from 13550/13650 where I will be a small buyer with a 13425 wider stop. I still do not want to be short the market at this time.
Cash FTSE
My FTSE plan worked well with the market trading lower to my 7370 buy level before rallying to my 7415 revised T/P level and I am now flat. Despite the weakness in Sterling, the FTSE struggled all day yesterday, and is opening lower this morning, trading at a price of 7330. We have support from 7210/7270 where I will again be a buyer with a 7145 stop. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
The Dow is now trading 900 points lower from where I marked prices 24 hours ago. This down move I did not for see. However, I was lucky as after the Dow hit my 33700 buy level, I emailed my Platinum Members to exit any long position at 33800 and I am still flat as I did not have a second buy level thankfully. The Dow has support below form 32650/32950 where I will be an aggressive buyer with no stop. If I am taken long I will have a T/P level at 33210. Given, how oversold the Dow remains I still do not want to be short the market at this time..
Cash NASDAQ 100
My NDX plan worked well with the market trading lower to my 14130 buy level before rallying to my revised 14225 T/P level and I am still flat. The crash in Treasury Yields helped technology stocks yesterday. Despite the higher inflation, Bond Yields are telling there will less rate hikes than expected which will in time help the Equity Markets. The NDX has support from 13700/13820 where I will be an aggressive buyer with a 13595 tight stop.
March BUND
Wow!!! The Bund has rallied over 300 points since I marked prices yesterday morning with the Yield turning negative, stlting at -06 basis points as I go to press. Thankfully, we had no sell level for this vertical move higher. I cannot see any rate hikes from the ECB this year given the political backdrop. The Bund has support from 169.20/169.70 and I will move my buy level higher to this area with a tight 168.75 stop.
Gold Rolling Contract
Gold surged yesterday as traders fled risk assets and I am still flat. Gold has resistance from 1970/1985 where I will be a very small seller with a 2001 stop.
Silver Rolling Contract
Silver followed Gold higher yesterday and I am still flat. I will now raise my buy level to 24.00/24.60 with a 23.35 stop.
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