U.S. Equity Markets closed lower yesterday, following a volatile first trading session for June. The S&P led the declines, closing lower by 0.75%. Many traders remain concerned about the pace of the U.S. Federal Reserve’s interest-rate hikes and the possibility that they may send the country into a recession. Even so, it remains uncertain whether these fears will come to fruition. Fed Board Member Christopher Waller emphasised this week that consumer spending and business investment remain strong. This was a point that was only bolstered by yesterday’s Job-Openings data as well as recent unemployment numbers. For the month of April, the U.S. Department of Labour said there were 11.4 million job openings. While this figure was lower than the previous month’s upwardly revised number of 11.9 million, it remained near record highs. This signifies continued demand for talent and a solid job market. Still, Waller noted that he remains concerned about rising costs, shrinking disposable incomes, and supply-chain disruptions. He added that if these issues persist, the situation may worsen – making it even more difficult for the Fed to combat inflation. Within the S&P 500, 10 of the 11 sectors finished lower. European Markets closed mixed. European Central Bank Council member Pablo Hernandez de Cos said the neutral interest rate is 1%, which is 1.5% higher than the current level. Russian gas giant Gazprom said it was cutting off supplies to companies in Holland, Denmark, and Germany over its refusal to pay for supplies in Rubles. German Retail-Sales figures for April were weaker than anticipated due to rising food and energy costs, which puts pressure on discretionary spending. In Asia, Australia’s First-Quarter Gross Domestic Production expanded more than anticipated thanks to a sharp rebound in exports. Caixin China’s Manufacturing Purchasing Managers’ Index data for May declined more than expected. But it has recovered compared with April due to easing COVID-19 mandates. Bank of Japan Deputy Governor Masazumi Wakatabe said he is sceptical about a return to high inflation and that the central bank shouldn’t rule out additional stimulus if necessary. China’s military command said it had conducted “combat readiness patrols” in the air and on the seas around Taiwan in response to potential collusion between Taipei and the U.S. Elsewhere, Oil again closed flat while Bitcoin fell 5% on continued Crypto volatility.
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For anyone following my Platinum Service it made 530 points yesterday on the first trading session for June after making 3651 points in May, having made 762 points in April, following a gain of 5883 points in March. The Platinum Service made an impressive 5324 points in February, after ending January with a gain of 3878 points, more than making up for December’s 932 points loss. 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 0.75% lower at a price of 4101.
The Dow Jones Industrial Average closed 177 points lower for a 0.54% loss at a price of 32,813.
The NASDAQ 100 closed 0.74% lower at a price of 12,548.
The Stoxx Europe 600 Index closed 0.2% lower.
Yesterday, the MSCI Asia Pacific Index rose 0.3%.
Yesterday, the Nikkei closed 0.65% higher at a price of 27,457
Currencies
The Bloomberg Dollar Spot Index closed 0.5% higher.
The Euro closed 0.8% lower at $1.0655.
The British Pound closed 1.1% lower at 1.2485.
The Japanese Yen fell 1.2% closing at $130.15.
Bonds
Germany’s 10-year yield closed six basis points higher at 1.18%.
Britain’s 10-year yield closed six basis points higher at 2.16%.
US 10 Year Treasury closed six basis points higher at 2.91%.
Commodities
West Texas Intermediate crude closed flat at $114.25 a barrel.
Gold closed 0.58% lower at $1848.10 an ounce.
This morning on the Economic Front we have Euro-Zone PPI at 10.00 am, followed by U.S. ADP Employment Report at 1.15 pm. Next, we have Weekly Jobless Claims and Non-Farm Productivity at 1.30 pm. Finally, at 3.00 pm we have Factory Orders.
Cash S&P 500
Even though yesterday saw plenty of two-way price action leading to a fall of 0.75% in the S&P, incredibly the VIX finished lower by 2% which makes no sense. Yesterday my S&P plan worked well with the market trading the whole of my buy range for a 4095 average long position before rallying to my 4124 revised T/P level as emailed to my Platinum Members and I am now flat. The S&P closed in the middle of my 4080/4120 target level. We have short-term support from 4040/4070 where I will again be a buyer with a 4019 wider stop. The McClellan Oscillator closed last night at +199, working off some of its overbought condition. My only interest in selling the S&P is still on a further rally to 4195/4225 with a tight 4241 stop.
EUR/USD
The Euro got hit hard yesterday and I am now long at a price of 1.0660. I will add to this position at 1.0600 with a now lower 1.0555 stop. I will now lower my T/P level to 1.0695 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 Dollar continued to rally yesterday, hitting my second sell level at 102.50 for a now 102.20 average short position. I will leave my 102.81 ‘’Closing Stop’’ unchanged while raising my T/P level to 101.90.
Cash DAX
The DAX missed my initial 14290 buy level before rallying over 100 points and I am still flat. Given the back-up in Bund Yields I will now lower my buy range again to 14100/14180 with a wider 13995 stop. If I am taken long I will have a T/P level at 14260. Despite yesterday’s continued sell-off I still do not want to be short the DAX at this time.
Cash FTSE
I am still flat. I will now lower my sell level to 7620/7680 with a lower 7725 tight stop.
Dow Rolling Contract
My Dow plan also worked well yesterday with the market trading lower to my 32720 buy level before rallying over 200 points to my 32920 revised T/P level and I am now flat. We saw plenty of hawking talk yesterday from Fed Officials while Jamie Dimon added to the gloom. However, despite the negative vibe, both the S&P and Dow held key support levels which is encouraging. The Dow has strong support from 32200/32500 where I will be an aggressive buyer with no stop for now. Meanwhile the Fear & Greed Index continued to improve, closing last night at a price of 25 which is now a reading of ‘’Fear’’. The Dow has resistance from 33450/33700 where I will continue to be a seller with no stop for now.
Cash NASDAQ 100
The NDX was the strongest of the American Indexes yesterday which was a surprise given the further six Basis Points rise in Treasury Yields. Maybe the worst of the bad news is now priced into Technology Stocks? I am still long and wrong from April at a price of 14327. I will leave my 13090 exit level unchanged on this position for now. I will look to add to this position on any further move lower to 12350/12150 with a 11995 stop. If I am taken long at this range I will have a T/P level at 12510.
June BUND
The Bund got hit hard again yesterday, trading to new Contract lows, hitting my second buy level at 150.80 for a now 151.20 average long position. I will now lower my T/P level to 151.65 while leaving my 150.35 ‘’Closing Stop’’ unchanged. If any of the above levels are hit I will be back with a new update for my Platinum Members.
Gold Rolling Contract
No Change. I am still a buyer on any dip lower to 1805/1820 with the same 1789 stop. If I am taken long I will have a T/P level at 1832.
Silver Rolling Contract
Silver rallied to my 21.90 T/P level on Tuesday’s 21.50 long position and I am still flat. Today, I will again be a buyer from 20.70/21.30 with a 19.95 stop.
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