For the second consecutive week, U.S. Equity Markets made new lows on a Friday as the trend of lower highs and lower lows remains in place. Despite Friday’s sell-off, the Friday VIX crush again happened as the VIX closed lower by over 6% following a volatile week. The latest inflation report from the U.S. Bureau of Labour Statistics showed a 0.2% monthly increase for both the overall and core Consumer Price Index (“CPI”) readings. This marks the smallest back-to-back increase in more than two years for the core CPI, which excludes volatile food and energy costs. It also improves the likelihood that the Fed will hold rates through the end of the year. On the other hand, inflation is still above the central bank’s 2% target. Meanwhile, the current reading does not include the recent surge in gasoline prices, which will likely show up in the next report. During a political fundraiser last Thursday, President Joe Biden downplayed the threat of the Chinese Communist Party and claimed that the country had severe economic problems and referred to the economy as a ‘ticking time bomb’. Biden’s criticisms of China were not his first this year, but maybe his most direct. It is yet to be seen how China will respond after dismissing previous comments from Biden in which he referred to Chinese President Xi Jinping as a ‘dictator’. European Markets closed lower. The U.K. economy surprised many on Friday, posting better than expected growth for the second quarter. Following calls for a stagnant quarter of growth, the economy expanded by 0.2%. Despite continued pressures of high inflation and tightening monetary policy, consumer and government spending propelled enough activity to withstand a contraction. While these figures were a positive, overall, the outlook remains weak and further rate hikes from the Bank of England are still likely. Following its invasion of Ukraine, Russia was dealt blow after blow of economic and political sanctions from Western nations. Over a year later, signs are beginning to emerge that the Russian economy may finally be close to returning to pre-war levels. According to Prime Minister Mikhail Mishustin, the economy expanded by 4.6% in the second quarter and 1.5% for the first half of the year. However, some analysts are still sceptical that the economy can maintain a strong long-term growth trajectory if military conscription continues for the drawn-out war in Ukraine. In Asia, Alibaba (BABA) recently announced that it is struggling to grapple with the U.S ban on chip exports to China. CEO Daniel Zhang says the company is unable to fulfil artificial-intelligence-related demand for clients due to global supply restraints. The already-tight supply is worsened by the fact that the U.S. has banned Chinese companies from buying semiconductor company Nvidia’s (NVDA) more advanced chips. Even more, the White House announced that it would now limit American investment into China’s quantum-computing and AI markets. Elsewhere, Oil rose a further 1.1% while a weak Gold, saw prices close lower by 1.1% on Friday.
To mark my 2850th 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 825 points last week and is now ahead by 1500 points for August following a small gain of 285 points gain in July, after closing June with a gain of 2683 points. May closed with a gain of 3205 points. 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 0.11% lower at a price of 4464.
The Dow Jones Industrial Average closed 105 points higher for a 0.30% gain at a price of 35,281.
The NASDAQ 100 closed 0.67% lower at a price of 15,028.
The Stoxx Europe 600 Index closed 1.09% lower.
Last Friday, the MSCI Asia Pacific closed 0.4% lower.
Last Friday, the Nikkei closed 0.84% higher at a price of 32,473.
Currencies
The Bloomberg Dollar Spot Index closed 0.4% higher.
The Euro closed 0.1% higher at $1.0950.
The British Pound closed 0.1% lower at 1.26.94.
The Japanese Yen fell 1.8% closing at $144.95.
Bonds
Germany’s 10-year yield closed 6 basis points higher at 2.63%.
Britain’s 10-year yield closed 7 basis points higher at 4.53%.
U.S.10 Year Treasury closed 2 basis points lower at 4.16%
Commodities
West Texas Intermediate crude closed 1.1% higher $83.69 a barrel.
Gold closed 1.1% lower at $1913.10 an ounce.
This morning on the Economic Front we have the release of German Wholesale Price Index at 7.00 am. We have no other data of note on either side of the Atlantic.
Cash S&P 500
Despite the S&P closing lower on Friday, Bears are hardly making any progress with marginal new lows day after day while the gaps keep building followed by backing and filling. On Friday the 15-Min RSI never got oversold despite the S&P making a new low for the month at 4443. The $BPSPX has joined the $BPNDX in getting oversold meaning I have no interest in being short as the positive seasonality again kicks in this week on top of new buybacks. Any tag of the 50-Day MA at 4437 will see me being an aggressive buyer. My S&P plan worked well as I bought the S&P on four occasions for a total gain of 505 points. I urge everyone to be a member of my Platinum Service as the updated emails help greatly. My good luck in the S&P ran out on Thursday when I bought the post S&P sell-off at 4497 before getting stopped at 4477 and I am now flat. Today, I will be an aggressive buyer from 4434/4449 with a tight 4419 ‘’Closing Stop’’. I still do not want to be short the S&P at this time.
EUR/USD
A boring week for the Euro, trading in a 100-point range. My long 1.1030 Euro position finally hit my 1.1060 revised T/P level on Thursday. The subsequent sell-off as me long again at 1.1000. I will add to this position at 1.0940 with a now lower 1.0875 ‘’Closing Stop’’. I will have a T/P level at 1.1060. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
June Dollar Index
The Dollar traded again in a narrow range all-week and I am still flat. The only currency to have a net change on the week is the Japanese Yen which is weaker by 2% at a price of 145.00. The Dollar has resistance from 103.20/103.80 where I will continue to be a seller with the same 104.25 ‘’Closing Stop’’. We have support from 100.80/101.50 where I will continue to be a buyer with the same 100.15 tight ‘’Closing Stop’’.
Cash DAX
My DAX plan worked well as the market traded lower to my 15810-buy level before having a 200-point rally. This move higher hit my 15890 T/P level and I am still flat. The DAX is heavy, has support from 15600/15700 where I will be a small buyer with a 15495 wider ‘’Closing Stop’’. I still do not want to be short the DAX at this time.
Cash FTSE
No Change. The boring action in the FTSE continues despite the higher Gilt Yields. We have short-term support from 7410/7470 where I will be a strong buyer with a 7355 ‘’Closing Stop’’.
Dow Rolling Contract
It was hard to make points in the Dow last week as the market traded in a narrow range. After the Dow hit my 35100 buy level, I exited this position for a small gain at 35140 and I am still flat. The Dow has short-term support from 34800/34970 where I will be a small buyer with a 34695 tight ‘’Closing Stop’’.
Cash NASDAQ 100
The NDX was the weakest of the American Indexes last week, led by the 5% fall in Apple Shares. Incredibly Apple is now oversold with a 14-day RSI at 29. History tells us that every time the RSI falls below 30, Apple is a buy. Early in the week the NDX hit 15220 buy level before rallying to my 15330 T/P level. Subsequently, the NDX fell to my second buy level at 15190 before rallying to my 15330 T/P level. Following a softer than expected CPI print on Thursday the NDX surged before falling 400 points late Thursday into Friday. Given my view on Apple, I bought the NDX again at a price of 15225. Friday’s 0.67% fall saw the NDX close below its 50-Day Moving Average (15150) for the first time since early March when the Fed added liquidity to the system after the bank failures. As the NDX also closed below its Daily Bollinger I am comfortable in being long with no stop for now. I will add to this trade at 14900 while lowering my T/P level to 15300. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
September BUND
The Bund traded in a wide 250-point range over the last week. The initial move higher saw my 131.95 T/P level triggered on my 131.45 long position. The Bund hit a high at 134.00 before falling 250 points, hitting my second buy level at 131.45 on Friday as emailed to My Platinum Members. I am still long, and I will add to this position at 130.75. I will have a T/P level at 132.05 with a tight 130.15 ‘’Closing Stop’’. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
Despite the Dollar trading in a narrow range last week, Gold was weak, closing over 1% lower. After Gold hit my 1916 buy level, we had a small rally to 1928, enabling to me to cover this position at my revised 1922 T/P level and I am now flat. Everybody I talk to is long Gold. However, every time Gold trades above 1950 it is met by strong selling. Gold has support from 1890/1905 where I will again be a buyer with a lower 1879 ‘’Closing Stop’’.
Silver Rolling Contract
Silver had a bad week, falling over 3% since I last marked prices on August 4th. I am still long at an average rate of 24.20 with the same 24.70 T/P level. Even though Silver is trading at 22.70 this morning I will continue to have no stop on this position. If this view changes I will email my Platinum Members.
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