Both U.S. Equity Markets and Treasuries were firmer on Monday in a quiet US session, with the Russell 2000 and Nasdaq 100 outperforming the S&P 500 – gains accelerated in late trade after the Treasury financing estimates for the quarter ahead were reduced. Geopolitics were in the limelight following the death of three US servicemen in Jordan amid a reported drone strike by Iran-affiliated groups, although oil prices reversed lower through the session amid the liquidation order for China’s Evergrande and reports that negotiators from Israel, the US, Egypt and Qatar have agreed on a framework for the release of the remaining American and Israeli hostages. Treasuries saw a notable bid ahead of this week’s refunding announcement and FOMC, that is despite another deluge of corporate debt supply on Monday – Bloomberg reported US corporate bond sales have hit USD 176 billion in January, a record for the month – with late-session gains made after the cut in the financing estimates. The Dollar Index was little changed with Euro weakness on the back of dovish comments from ECB’s Centeno offset by Japanese Yen strength on yield differentials. The Hungarian Forint was particularly hit as the country vowed to defy EU pressure to approve a Ukraine aid package, with the FT reporting the bloc has set out plans to sabotage the country’s economy in response. Treasury announced it expects to borrow USD 760 billion in net marketable debt for the January-March period, down USD 55 billion from its October 2023 estimate “largely due to projections of higher net fiscal flows and a higher beginning of quarter cash balance”, assuming an end-of-March cash balance of USD 750 billion. It also expects to borrow a much smaller USD 202 billion in the April-June period, assuming an end-June cash balance of USD 750bln. Additional financing details relating to Treasury’s Quarterly Refunding will be released at 08:30EST/13:30GMT on Wednesday, January 31st, 2024. Elsewhere, Oil fell 1.32% while Gold ended Monday with a 0.6% gain.
To mark my 2925th 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 130 points yesterday and is now head by 3512 points for January. December saw a gain of 1890 points after finishing November with a gain of 1734 points. October ended with a gain of 3184 points, after closing September with a small gain of 228 points, after finishing August with a gain of 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 0.76% higher at a price of 4927.
The Dow Jones Industrial Average closed 224 points higher for a 0.59% gain at a price of 38,333.
The NASDAQ 100 closed 1.01% higher at a price of 17,596.
The Stoxx Europe 600 Index closed 0.21% higher.
Yesterday, the MSCI Asia Pacific closed 0.5% higher.
Yesterday, the Nikkei closed 0.77% lower at a price of 36,026.
Currencies
The Bloomberg Dollar Spot Index closed 0.03% higher.
The Euro closed 0.2% lower at $1.0831.
The British Pound closed 0.1% higher at 1.2712.
The Japanese Yen rose 0.5% closing at $147.51.
Bonds
Germany’s 10-year yield closed 6 basis points lower at 2.24%.
Britain’s 10-year yield closed 5 basis points lower at 3.97%.
U.S.10 Year Treasury closed 7 basis points lower 4.07%.
Commodities
West Texas Intermediate crude closed 1.32% lower at $76.98 a barrel.
Gold closed 0.6% higher at $2031.10 an ounce.
The morning on the Economic Front we have German GDP and a speech from ECB Member Lane at 9.00 am. Next, we have U.K. Money Supply and Mortgage Approvals at 9.30 am. This is followed by Euro-Zone GDP and the latest Economic Sentiment Indicator at 10.00 am. At 2.00 pm we have U.S. Housing Price Index. Finally, at 3.00 pm we have JOLTS Job Openings and Consumer Confidence
Cash S&P 500
Yesterday session was choppy in a narrow range on extremely light volume until Treasury Secretary launched another drone attack on bears, showing much lower funding requirements, especially in the second Quarter. This is from the same Treasury team that could not correctly predict a single quarter in 2023. However, this announcement triggered a buy programme in the last hour of trading, helping the Dow and S&P to new all-time highs. The 14-Day RSI for the S&P closed above 76. I just cannot justify been a buyer against this background. Indeed I was lucky today as after the S&P hit my initial 4898 sell level we sold off to my revised 4889 T/P level and I am still flat. The VIX traded in an odd manner yesterday, spiking to an intra-day high at 15 before selling off but still closing 2.5% higher at a price of 13.60. I am not calling for a major sell-off from here but after an 830 Handle rally in 14 weeks, the market is due a correction. Today, I will be a seller on any further rally to 4938/4953 with a higher 4967 ‘’Closing Stop’’. I still no longer want to be a buyer of the S&P at these levels.
EUR/USD
No Change. The Euro hit a morning low at 1.0795 before rallying to close at 1.0835 in New York. I am still long from last week at 1.0835 with the same 1.0900 T/P level. I will add to this position at 1.0775 while leaving my 1.0715 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dollar Index
The Dollar hit my 103.80 sell level. Overnight, the Dollar traded lower to my revised 103.40 T/P level as emailed to my Platinum Members before last night’s close and I am now flat. Today, I will again be a seller from 103.85/105.45 with the same 105.05 ”Closing Stop”.
Cash DAX
I am still flat as the DAX never came close to yesterday’s buy range before tagging on another 100 points into the New York close, sitting at 17,000 as I go to press. The DAX has support from 16730/16830 where I will be a small buyer with a 16645 higher tight ‘’Closing Stop’’. I still do not want to be short the DAX at this time.
Cash FTSE
For the first time this month, the FTSE has closed higher for three consecutive trading sessions, trading at 7675 as I go to press. We were right not to press the downside given how oversold and decoupled the FTSE had become. I will leave my 7500/7570 buy level unchanged with the same 7435 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 7615.
Dow Rolling Contract
Monday’s late rally saw the Dow hit my sell range. I am now short in small size at 38280. I will add to this position at 38530 while leaving my 38705 ‘’Closing Stop’’ unchanged. I will now raise my T/P level to 38150 as I want where possible to be flat ahead of tomorrow’s FOMC Statement and Powell press conference. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash NASDAQ 100
Nothing matters as the NDX surged in the last 30 minutes of trading. This move higher has me short at 17510. I will add to this position at 17660 while raising my ‘’Closing Stop’’ to 17755. I will now raise my T/P level to 17420. If any of the above levels are hit, I will be back with a new update form my Platinum Members.
March BUND
I am still flat as thankfully we had no sell level in the Bund given the rally in Treasury Bonds over the past 24 hours. I will now raise my Bund buy level to 133.60/134.30 with a higher 132.95 ‘’Closing Stop’’.
Gold Rolling Contract
I am still flat Gold. As I still long both the Euro and Silver, I will leave my 1873/1998 Gold buy level unchanged with the same 1959 wider ‘’Closing Stop’’.
Silver Rolling Contract
No Change. I still believe in the bull case for this precious metal. I will continue to hold my 24.40 average long position with no stop or T/P level for now. This morning, Silver is trading higher this morning at a price of 23.22. I will look to add to my existing long position on any further move lower to 21.50. If this view changes, I will be back with a new update for my Platinum Members.
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