U.S. Equity Markets closed higher on Monday led by the big tech bias underscored by Microsoft’s (MSFT) recovery amid the fluid OpenAI situation, which dominated newsflow in an otherwise quiet session. Treasuries saw bull-flattening amid a well-received 20yr auction, alleviating some of the concerns around duration supply after the horrific 30yr offering the other week. It was noticeable that the major stock indices found additional strength after the auction, while the Dollar saw further weakness. The Japanese Yen and Antipodeans led G10 strength vs the Dollar amid the lower yield environment and the risk appetite, while the Canadian Dollar lags ahead of CPI despite the higher oil prices. The recovery in the crude benchmarks was a continuation of the rip from Friday amid the source reports of a potential deeper OPEC+ production cut rather than anything incremental on Monday, although the softer Dollar helped. Copper prices were well bid amid the potential indefinite strike at Peru’s Las Bambas mine, with the supply risk heightened by First Quantum Minerals reportedly considering putting the Panama copper mine in care/maintenance mode. A solid auction for the new issue 20s which has been made all the more respectable given the lack of concession going into it and the concerns around long-end supply on the back of the second consecutive awful 30yr auction the other week, not to mention thinner trading conditions ahead of Thanksgiving. The 4.780% high yield marked a 1bp stop-through the WI, not as strong as last month’s 1.2bps but impressive vs the six-auction average stop-through of 0.7bps. The auction was covered 2.58x, a bit beneath the prior 2.59x and average 2.67x. Dealers (forced surplus buyers) were left with a small 9.5% (prev. 11.9%, avg. 10.2%) with both Directs and ‘’Indirects’’ taking a step-up M/M in demand, indicative of strong end-user demand. European Markets closed flat following a small trading range across the board. Meanwhile, Oil closed 2.12% higher while Gold reversed earlier losses to close flat on the day.
To mark my 2900th 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 lost 390 points on yesterday and is now ahead by 785 points for November. October ended with a gain of 3184 points, after closing September with a small gain of 228 points, after finishing August with 1485 points, 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 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 0.74% higher at a price of 4547.
The Dow Jones Industrial Average closed 203 points higher for a 0.58% gain at a price of 35,151.
The NASDAQ 100 closed 1.19% higher at a price of 16,027.
The Stoxx Europe 600 Index closed 0.09% higher.
Yesterday, the MSCI Asia Pacific closed 0.1% higher.
Yesterday, the Nikkei closed 0.59% lower at a price of 33,388.
Currencies
The Bloomberg Dollar Spot Index closed 0.42% lower.
The Euro closed 0.2% higher at $1.0938.
The British Pound closed 0.3% higher at 1.2502.
The Japanese Yen rose 0.8% closing at $148.35.
Bonds
Germany’s 10-year yield closed 2 basis points higher at 2.61%.
Britain’s 10-year yield closed 2 basis points higher at 4.13%.
U.S.10 Year Treasury closed 1 basis points lower at 4.43%.
Commodities
West Texas Intermediate crude closed 2.12% higher at $77.50 a barrel.
Gold closed 0.1% lower at $1978.10 an ounce.
This morning on the Economic Front we have U.K. Public Sector Net Borrowing Requirement at 7.00 am. This is followed by Canadian Inflation and the Chicago Fed National Activity Index at 1.30 pm. Finally, we have Existing Home Sales at 3.00 pm and the FOMC Minutes from the last Fed Meeting at 7.00 pm.
Cash S&P 500
There is no doubt the aggressiveness of the S&P rally over the past three and a half weeks is taking most investors by surprise. Despite the severely short-term overbought conditions the S&P is not giving anyone a chance to get long as one open gap after another remains unfilled. History tells us that this is not sustainable and is one of the reasons that I am now pressing the downside. The reversal in both the U.S. Dollar and lower Bond Yields coupled with a massive expansion in bank reserves on top of the slowing of the TGA Account has led to the S&P rallying over 450 Handles. We are now seeing a huge liquidity expansion and thereby massive easing in financial conditions. Yesterday’s move higher has me short at an average rate of 4533. I will leave my ‘’Closing Stop’’ unchanged at a tight 4551 while raising my T/P level to 4524. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
EUR/USD
The Euro continued its latest impressive rally, hitting my initial 1.0950 sell level. With the 14-Day RSI closing at 72 last night, I will continue to look to add to this position at 1.1020 with the same 1.1075 ‘’Closing Stop’’. I will now raise my T/P level to 1.0910. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
September Dollar Index
The Dollar fell a further 0.42% yesterday, hitting my 103.40 buy level. I am still long with a now lower 103.90 T/P level. I will add to this position on any further move lower to 102.80 while leaving my 102.25 ‘’Closing Stop’’ unchanged. If any of the above levels are hit I will be back with a new update for my Platinum Members.
Cash DAX
No Change. Incredible 1400-point rally in the DAX in three weeks. Thankfully we had no short position in this market. As I cannot buy the DAX at these levels, nor do I want to be short I am going to stay flat the DAX until I see a better risk/reward opportunity. Sometimes it is better to sit on your hands. I much prefer to be short the American Indexes given the liquidity. If this view changes I will be back with a new update for my Platinum Members.
Cash FTSE
The FTSE traded in a narrow range yesterday and I am still flat. I will continue to be a buyer on any dip lower to 7370/7440 with the same 7325 ‘’Closing Stop’’. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
Wrong! It almost felt inevitable that I would get stopped of last week’s 34715 average short position which I did at a price of 35105 and I am still flat. The $NYSI is now maximum overbought having been maximum oversold four weeks ago. This indicator shows the extent of the recent rally in American Indexes. Given the technical backdrop where a number of signals are showing negative divergence, I just cannot be a buyer at these levels. The Dow has further resistance from 35240/35490 where I will again be a seller with a 35705 ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 35060.
Cash NASDAQ 100
Lower Treasury Yields saw the NDX again outperform the main U.S. Indexes yesterday. As a result, the NDX traded the whole of my sell range for a now 15965 average short position. I will leave my 16105 ‘’Closing Stop’’ unchanged. I will now raise my T/P level to 15870. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
December BUND
I am still flat the Bund as the market again just missed my initial buy level. I will continue to be a buyer on any dip lower to 129.60/130.40 with the same 128.95 ‘’Closing Stop’’. I still do not want to be short the Bund at this time.
Gold Rolling Contract
Frustratingly, Gold missed my initial 1965 buy level by 20 cents before having a nice $12 rally into the New York close. I am surprised that Gold was weak yesterday given the weakness in the Dollar. Today, I will continue to be a buyer of Gold on any further dip lower to 1943/1958 with a now lower 1929 ‘’Closing Stop’’.
Silver Rolling Contract
No Change. I am still long Silver from six weeks ago at 24.05. Silver has traded in a narrow 100-point range with very small daily ranges over the past few weeks. I am extremely bullish of Silver while frustrated that Silver has not followed the price of Gold higher. In a change of strategy, I will have no stop or no T/P level on this position. This morning Silver is trading lower at 23.55. If this view changes, I will be back with a new update for my Platinum Members.
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