U.S. Equity Markets surged Friday after the April jobs report showed stronger than expected job gains with the unemployment rate falling to 3.4%. Wage growth grew 0.5% MOM, beating estimates. However, downward revisions for February and March job numbers did soften the overall number. Apple is still a heavyweight. While revenue declined for the second consecutive quarter, the tech giant beat expectations led by a record setting quarter for its services business and stronger than anticipated iPhone sales. As Apple (AAPL) has become accustomed to, the company authorised an additional $90 billion for share buybacks. Regional banks suffered another day of sizable losses as anxiety crippled the markets Thursday. Investors were so pessimistic that Fed-Fund Futures began to register as much as a 10% chance the Fed will cut rates in June. While unlikely, investors are becoming skittish and for good reason – the SPDR S&P Regional Banking ETF closed at its lowest level since October 2020. However, on Friday the better mood saw the Bank Index close 4% higher. Johnson and Johnson’s (JNJ) consumer health business Kenvue, raised $3.8 billion in its initial public offering, making it the largest listing since 2021. Kenvue, which owns products such as Tylenol, Listerine, and other household brands recorded revenue of ~$15 billion last year. The Federal Deposit Insurance Corporation is planning to release a plan for refilling its Deposit Insurance Fund which would exempt smaller lenders from footing much of the bill. Larger banks such as JPMorgan Chase (JPM) would see higher fees associated with the plan. European Markets closed higher despite awful economic data. German Factory Orders plummeted the most since the onset of the pandemic in early 2020. Demand declined 10.7% as manufacturing continues to be a severe headwind to any economic growth this year. Recession fears grow stronger now as any optimism for a moderate rebound in growth seemed to be short-lived. The European Central Bank and President Christine Lagarde may have slowed its pace of rate hikes on Thursday, but the central bank affirmed its position that a pause is not in consideration for now. A stark contrast to the narrative Federal Reserve Chair Jerome Powell gave last week. Investors are hesitant to believe that the ECB would continue raising rates for too long after a Fed pause, given historical precedent. Elsewhere, Oil rose 4% while Gold was slammed, closing lower by 1.50%.
To mark my 2800th 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 60 points on Friday and is now ahead by 1623 points for May. April saw a gain of 3354 points while March closed with a gain of 6168 points. The Platinum Service made 3164 points in February, 4687 points in January 2054 points in December, 4789 points in November and a record 9619 points last October. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1900 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 1.85% higher at a price of 4136.
The Dow Jones Industrial Average closed 546 points higher for a 1.65% gain at a price of 33,674.
The NASDAQ 100 closed 2.13% higher at a price of 13,259.
The Stoxx Europe 600 Index closed 1.08% higher.
This morning, the MSCI Asia Pacific closed 0.50% higher.
This morning, the Nikkei closed 0.67% lower at a price of 28,962.
Currencies
The Bloomberg Dollar Spot Index closed 0.2% lower.
The Euro closed 0.1% higher at $1.1045.
The British Pound closed 0.3% higher at 1.2653.
The Japanese Yen fell 0.3% closing at $134.70.
Bonds
Germany’s 10-year yield closed 10 basis points higher at 2.28%.
Britain’s 10-year yield closed 13 basis points higher at 3.78%.
U.S.10 Year Treasury closed 12 basis points higher at 3.44%.
Commodities
West Texas Intermediate crude closed 4% higher at $71.25 a barrel.
Gold closed 1.50% lower at $2014.10 an ounce.
This morning on the Economic Front we already had the release of German Industrial Production which fell 3.4% versus – 1.3% expected. At 9.30 am we have Euro-Zone Sentix Investor Confidence. The only other data of note is U.S. Wholesale Inventories at 3.00 pm.
Cash S&P 500
Friday saw another vertical gap in the market led by Apple whose market cap improved by over $100bn as the share surged above its Daily Bollinger Band, following Microsoft in the process. The question remains about sustainability. Who in their right mind chases a $2.7 trillion stock above its upper Daily Bollinger Band? I cannot justify long positions at these levels with this backdrop. Thankfully on Friday we had no short positions respecting the fact that the 50 Day Moving Averages are proving to be strong support over the past few months. The VIX got destroyed on Friday. Closing lower by over 14%, closing at a price of 17.19. This is the seventh consecutive Friday that the VIX has been crushed. Despite the Bank Index rallying 4% the Daily Chart looks awful. However, despite my concerns I have to respect the price action which continues to be bullish. This will continue until the respective 50 Day MAs are broken. The S&P has resistance from 4160/4175 where I will be a small seller with a 4191 tight ‘’Closing Stop’’. The S&P has short-term support from 4095/4112. I will now raise my buy level to this area with a higher 4079 ‘’Closing Stop’’.
EUR/USD
Unfortunately, the Euro missed my 1.0950 buy level by 15 points before having a nice rally into the New York close. I will now raise my buy level to 1.0920/1.0990 with a higher 1.0855 ‘’Closing Stop’’. I still do not want to be short the Euro at this time.
June Dollar Index
I am still flat the Dollar. I will continue to be a buyer on any dip lower to 99.90/100.60. with the same 99.35 ‘’Closing Stop’’.
Cash DAX
It does not matter what the News as the DAX continue to attract strong buying on any dip. The DAX is trading over 200 points from where I marked prices on Friday. Industrial Production fell 3.4% this morning. Germany is in recession, yet the DAX is trading close to all-time highs which is insane. The price action tells us not to be short while the economic backdrop makes its extremely hard to be a buyer. I will now raise my buy level to 15750/15830 with a higher 15675 ‘’Closing Stop’’. The DAX has resistance from 16100/16200 where I will be a small seller with a 16305 ‘’Closing Stop’’.
Cash FTSE
The FTSE had a late rally on Friday helping me to exit my 7795 average long position at my revised 7807 T/P level and I am now flat. The CASH FTSE is closed today for the Coronation. As a result, I will stay flat until the market re-opens tomorrow.
Dow Rolling Contract
Incredible. The Dow has its best day since January 6, closing higher by 1.65%. I know strength has to respected but when you see the $BPSPX close in the Red on Friday on a day when the American Indexes closed higher by nearly 2% you have to wonder. May is seasonally one of the weakest months of the year. The seasonality chart has worked so well of the past few years making it harder to fathom the ongoing bullish markets. The Dow has resistance from 33900/34150 where I will be a small seller with a 34305 ‘’Closing Stop’’. I will now raise my buy level to 33100/33350 with a higher 32995 ‘’Closing Stop’’.
Cash NASDAQ 100
The NDX led Friday’s gains closing higher by 2.15%. Thankfully we had no sell level given the 300-point rally. The NDX has resistance from 13380/13530 where I will be a small seller with a 13605 tight ‘’Closing Stop’’. I do not want to be long the NDX at this time.
June BUND
The Bund got hit hard on Friday, hitting my 135.80 buy level. As I wanted to bank some points, I covered this position at my revised 136.08 T/P level and I am now flat. Given the economic backdrop it is hard to see the ECB continuing with their rate hikes. The German Economic data is horrible. The Bund has support from 134.80/135.60 where I will be a strong buyer with a 133.95 ‘’Closing Stop’’.
Gold Rolling Contract
Gold fell over $50 on Friday before having a small rally off its 1999 low print into the close. Gold traded the whole of my buy range for a 2016 average long position. As I have a large position in Silver I used the late rally to exit this position at 2018 and I am still flat. Gold has support from 1980/1995 where I will again be a buyer with a 1969 ‘’Closing Stop’’.
Silver Rolling Contract
Silver traded lower to my 25.40 buy level. I am still long. I will add to this position at 24.60 while leaving my 23.85 ‘’Closing Stop’’ unchanged. I will now lower my T/P level to 26.20. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
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