U.S. Equity Markets ultimately saw mild weakness yesterday but were off the European morning lows with underperformance in the Nasdaq and Russell with Communication, Health and Tech names lagging, with the former weighed on by chip names with NVDA closing in the red and weakness in AMAT after it received subpoenas related to China from the SEC and US Attorney’s Office. U.S. data ultimately had little sustainable reaction with Q4 ’23 GDP revised down but the deflator, sales, PCE and Core PCE were revised up but did little to alter the Fed’s narrative with all eyes on the January PCE report due this afternoon. T-Notes bull steepened ahead of PCE data with the initial downside on the aforementioned revisions completely pared. Fed speakers saw Williams, Collins and Bostic toe the recent Fed lines while Logan spoke on the balance sheet, stressing that slowing the balance sheet runoff, does not mean stopping QT. In FX, the Dollar was flat as DXY failed to hold above 104.00 while Antipodes underperformed after a dovish hold from the RBNZ and softer-than-expected Australian CPI. Oil prices were very choppy with morning upside pared on a larger crude stock build, although products saw draws. Bitcoin meanwhile surged to test USD 64k at best levels, the highest since November 2021. Fed Member Logan in an interview that took place on Feb. 15th, said slowing the balance sheet runoff means managing the pace, it does not mean stopping, stressing the need to disconnect the idea of a slower runoff pace and ending QT. The remarks are being made to clarify that she is not necessarily calling for a halt to QT in the aftermath of her speech on the issue from early January. Collins (non-voter) reiterated it will likely become appropriate to start easing policy later this year, and it is premature to say whether the Fed could cut in May. NY Fed Governor Williams (voter) echoed colleagues with his data-dependent approach and the Fed is likely to cut rates this year. On this, Williams believes three in 2024 is a reasonable debate. Regarding his forecasts, sees inflation hitting 2%-2.25% this year (prev. saw 2.25% in January) and 2% in 2025 (unchanged); Williams sees GDP growth at 1.5% this year (prev. 1.25% in Jan). He sees unemployment rising to 4% this year (unchanged). The 2nd estimate of U.S. GDP was revised down to 3.2% from 3.3%, despite expectations for it to be maintained at 3.3%. GDP sales were revised up to 3.5% from 3.2% while the deflator was also revised up to 1.7% from 1.5%. Core PCE was also revised up, to 2.1% from 2.0% in the advance read while headline PCE also saw an upward revision to 1.8% from 1.7%. Consumer spending rose to 3.0% from 2.8% in the advance estimate. Participants will be eyeing the January PCE data on Thursday for a timelier picture on inflation after the hot January CPI and PPI reports. Elsewhere, Oil closed 0.46% lower while Gold again closed flat.
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 was flat again yesterday and is still ahead by 1606 points for February after closing January with a gain of 3675 points. 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 0.17% lower at a price of 5069.
The Dow Jones Industrial Average closed 23 points lower for a 0.06% loss at a price of 38,949.
The NASDAQ 100 closed 0.54% higher at a price of 17,874.
The Stoxx Europe 600 Index closed 0.35% lower.
Yesterday, the MSCI Asia Pacific closed 0.4% lower.
Yesterday, the Nikkei closed 0.08% lower at a price of 39,208.
Currencies
The Bloomberg Dollar Spot Index closed 0.02% higher.
The Euro closed 0.1% lower at $1.0838.
The British Pound closed 0.1% lower at 1.2662.
The Japanese Yen fell 0.1% closing at $150.62.
Bonds
Germany’s 10-year yield closed 1 basis points lower at 2.46%.
Britain’s 10-year yield closed 1 basis points lower at 4.12%.
U.S.10 Year Treasury closed 4 basis points lower at 4.27%.
Commodities
West Texas Intermediate crude closed 0.46% lower at $78.18 a barrel.
Gold closed 0.1% higher at $2033.10 an ounce.
This morning on the Economic Front we have German Retail Sales at 7.00 am. Next, we have U.K. Consumer Credit and Mortgage Approvals at 9.30 am. At 1.00 pm we have German CPI, followed by U.S. Weekly Jobless Claims and PCE at 1.30 pm. At 2.45 pm we have the Chicago Purchasing Managers Index, followed at 3.00 pm by Pending Home Sales with the Kansas Fed Manufacturing Activity Index at 4.00 pm. Finally, we have speeches from Fed Members Bostic, Goolsbee and Mester at 3.50 pm, 4.00 pm and 6.15 pm respectively.
Cash S&P 500
For the third consecutive trading session volume was non-existent. The S&P volatility levels are at their lowest level since 2017. This is extremely frustrating for us investors who love to see plenty of two-way price action. With so many negative divergences in the market I am attempted to have a macro short position on board. However, seasonality is still strong for one more week so I will stay patient. I am still flat the S&P. Ahead of this afternoon’s key PCE data I will leave 5092/5106 sell level unchanged with the same 5121 ‘’Closing Stop’’. The S&P has support below from 5020/5038 where I will continue to be a buyer with the same 5007 ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 5078. If I am taken long, I will have a T/P level at 5053.
EUR/USD
No Change. I am still flat the Euro as I continue to be a buyer on any dip lower to 1.0700/1.0770 with the same 1.0635 ‘’Closing Stop’’. I still do not want to chase the Euro higher at this time.
Dollar Index
No Change. I am still flat the Dollar. I will continue to be a seller from 104.35/105.05 with the same 105.65 ‘’Closing Stop’’. I still do not want to be long the Dollar at this time.
Cash DAX
No Change: I have no interest in chasing the DAX higher as this market has become untradeable based on any fundamentals. Germany is in recession and the DAX closes at yet another new all-time high. I keep saying ‘’nothing matters’’ which is certainly the case with the DAX as the market makes one new high after another every week. I just cannot be a buyer of the DAX at these levels while the price action is telling you not to be short. I am going to stay flat the DAX until I get a better edge. If this view changes, I will be back with a new update for my Platinum Members.
Cash FTSE
The FTSE continues to trade heavy. Yesterday’s move lower saw my 7620-buy level triggered. I am still long with a now lower 7660 T/P level. I will add to this position at 7550 while leaving my 7495 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dow Rolling Contract
Unfortunately, the Dow missed my initial 38700 buy level by 40 points before rallying 200 points off this low into the close. I will now raise my buy level to 38510/38760 with a higher 38355 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 38920. I still do not want to be short the Dow at this time. If this view changes, I will be back with a new update for my Platinum Members.
Cash NASDAQ 100
The negative divergences that I talked about in yesterday’s Daily Commentary saw a small sell-off in the NDX before buyers again prevented the market from having a long overdue sell-off. I am still flat the NDX as we wait for this afternoon’s key PCE data. I am not going to chase the NDX lower leaving my 18030/18180 sell level unchanged with the same wider 18305 ‘’ Closing Stop’’. Given the number of negative divergences, I have no interest in being long the NDX at this time. If this view changes, I will be back with a new update for my Platinum Members. If I am taken short, I will have a T/P level at 17940.
March BUND
No Change. I am still long the Bund from Monday at a price of 132.65. I will add to this position at 131.95 with a now lower 131.35 ‘’Closing Stop’’. I will now lower my T/P level to 132.90. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
This is incredible, as the price action is non-existent. Today, I will continue to be a buyer on any dip lower to 1995/2010 with the same 1979 wider ‘’Closing Stop’’. If triggered, I will have a T/P level at 2018.
Silver Rolling Contract
No Change: I have never seen such little volatility in Silver over the past 12 months. It is as if nobody is trading this key commodity anymore. While Gold has had the odd spike, Silver continues to trade in narrow ranges every day. I am sticking to my guns in believing that Silver will at some stage break higher. I have a lot of my pension tied up in Silver and will continue to hold this position. I am still long Silver from six weeks ago at a price of 24.40. I will continue to look to add to this position at 21.50 with the same ‘’No Stop’’ or T/P level for now. If this view changes, I will be back with a new update for my Platinum Members.
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