U.S. Equity Markets closed lower yesterday, led by the 1.83% fall in the NASDAQ 100. During his State of the Union speech to Congress Tuesday night, President Joe Biden called for new taxes on billionaires and to quadruple the excise tax on stock buybacks. Federal Reserve Governor Christopher Waller said excessive inflation is a more serious problem than increasing rates. He said he needed to see further price moderation to feel comfortable ending rate hikes. New York Federal Reserve President John Williams said that while the Fed still has a lot of work to do on rate policy, the central bank has already done the bulk of the tightening this cycle. Mortgage Applications climbed as average lending rates fell for the fifth straight week, sitting at its lowest rate in five months. Within the S&P 500 Index, all the 11 sectors finished lower. European Markets closed higher. European Central Bank (“ECB”) Executive Board member Isabel Schnabel said it needs to continue with large interest-rate hikes as policy changes are doing little to slow inflation growth. ECB Governing Council member Joachim Nagel said it is too soon to declare victory over inflation and more significant interest-rate hikes may be needed. Think-tank National Institute of Economic and Social Research (“NIESR”) is the first major forecaster to predict the U.K. economy will avoid a recession this year. Growth is projected to be 0.2% this year. In Asia, The Reserve Bank of India raised its benchmark rate by 25 basis points to 6.50%, with signs it could be the final rate hike this cycle. The White House said it was up to China whether it wanted to build on a meeting between President Biden and President Xi Jinping following the downing of a suspected spy balloon. Japanese Prime Minister Fumio Kishida said his Cabinet is still in the process of selecting the next Bank of Japan Governor and will consider the effect on financial markets. Chinese Premier Li Keqiang stressed the importance of economic growth through the implementation of new policy ahead of the annual National People’s Congress in March. Elsewhere, Oil closed 1.62% higher while Gold closed slightly higher following a quiet trading session.
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For anyone following my Platinum Service it made 220 points yesterday and is now ahead by 1379 points for February after closing January with a gain of 4687 points, while finishing December with a gain of 2054 points. November ended with a gain of 4789 points, while finishing October with a record gain of 9619 points, making 6660 points in September, after closing August with a gain of 2228 points, having made 2660 points in July, following a gain of 3371 points in June. The Service made 3651 points in May, after making 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 1.11% lower at a price of 4117
The Dow Jones Industrial Average closed 207 points lower for a 0.61% loss at a price of 33,949.
The NASDAQ 100 closed 1.83% lower at a price of 12,495.
The Stoxx Europe 600 Index closed 0.23% higher.
This morning, the MSCI Asia Pacific rose 1.1%.
This morning, the Nikkei closed 0.08% lower at a price of 27,584.
Currencies
The Bloomberg Dollar Spot Index closed 0.1% higher.
The Euro closed 0.1% higher at $1.0723.
The British Pound closed 0.4% higher at 1.2067.
The Japanese Yen rose 0.1% closing at $131.27.
Bonds
Germany’s 10-year yield closed 1 basis points higher at 2.35%.
Britain’s 10-year yield closed 1 basis points higher at 3.33.
U.S.10 Year Treasury closed 3 basis points lower at 3.65%.
Commodities
West Texas Intermediate crude closed 1.62% higher at $78.39 a barrel.
Gold closed 0.19% higher at $1880.10 an ounce.
This morning on the economic front we already had the release of German Preliminary January CPI which rose 8.7% versus + 8.9% expected. At 9.45 am we have the Bank of England Monetary Policy Report Hearings. This is followed at 10.00 am by the EU latest Economic forecasts. At 1.30 pm we have the Weekly Jobless Claims. Finally, at 6.00 pm we have a 30-Year Treasury Auction. This will be closely watched following the rise in Yields since last Friday’s NFP Report.
Cash S&P 500
The S&P closed 1.11% lower yesterday as the market reversed some of Tuesday’s late gains. After we sold off the S&P traded sideways for most of the session before rallying overnight to sit 18 Handles higher at 4135 as I go to press. Yesterday, my S&P plan worked well as the market hit my 4118-buy level before rallying to my revised 4129 T/P level and I am now flat. It is a frustrating time for bears as all dips continue to be aggressively bought. I do not know if we will hit my 4020/4025 buy range before the next rip higher. We will probably have to wait for next week’s CPI before the market makes its next major decision. The S&P has support from 4100/4115 where I will again be a buyer with a 4089 ‘’Closing Stop’’. I will continue to be an aggressive buyer on any large drop to 4020/4035 where I will have no stop or no T/P level if triggered. The S&P has strong resistance at the Monthly 20 MA and Weekly 100 MA at 4220. As a result, I will be an aggressive seller from 4215/4235 with a wider 4251 ‘’Closing Stop’’.
EUR/USD
I am still flat the Euro as the market again traded in a narrow range above its 50 Day Moving Average which comes in at a price of 1.0680. I will now lower my buy level slightly to 1.0590/1.0660 with a lower 1.0525 ‘’Closing Stop’’.
March Dollar Index
No Change. I am still flat. I will continue to be a strong buyer on any dip lower to 101.80/102.60 with the same 101.25 ‘’Closing Stop’’.
Cash DAX
No Change. I am still flat. I will continue to be a seller on any further rally to 15590/15670 with the same 15745 ‘’Closing Stop’’. My only interest in buying the market is from 15050/15130, with the same tight 14975 ‘’Closing Stop’’.
Cash FTSE
The FTSE continues to ignore all political and economic woes as the market just fell shy of Friday’s all-time high. I am still flat. I will now raise my buy level to 7780/7850 with a higher 7715 ‘’Closing Stop’’.
Dow Rolling Contract
After the Dow sold off to my initial 33900 buy level near the close, I emailed my Platinum Members to exit any long position at my revised 33960 T/P level and I am now flat. The main reason that I exited this position is because I am still long the NDX. If you did hang on your Dow long, then that has worked for you this morning with Dow trading higher at 34070 this morning. The Dow continues to build value above its 50 Day Moving Average which is impressive given the rise in Bond Yields since last Friday’s NFP Report. Today, I will be a buyer of the Dow from 33660/33910 with the same 33495 ‘’Closing Stop’’. The Dow has further resistance from 34350/34600 where I will be a seller with a 34755 ‘’Closing Stop’’.
Cash NASDAQ 100
Having led Tuesday’s rally, the opposite occurred yesterday with the NDX leading the American Indexes lower with a near 2% fall. This down-move saw my 12530-buy level triggered. I am still long. I will now add to this position at 12380 while leaving my 12295 ‘’Closing Stop’’ unchanged. I will now lower my T/P level on this position to 12620. If any of the above levels are hit I will be back with a new update for my Platinum Members.
March BUND
The weaker than expected German CPI Report this morning saw the Bund hit my 136.60 T/P level on my latest 136.10 long position and I am now flat. Today, I will again be a buyer on any further dip lower to 135.30/136.10 with the same 134.75 ‘’Closing Stop’’.
Gold Rolling Contract
No Change. I do not like the price action following last Friday’s 3% fall. I am still flat. My only interest in buying Gold is still on a dip lower to 1839/1854 with the same 1825 ‘’Closing Stop’’.
Silver Rolling Contract
No Change. I am still long at an average rate of 23.10 with the same no stop policy. I will leave my T/P level unchanged at 23.10. If any of the above levels are hit I will be back with a new update for my Platinum Members.
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