U.S. Equity Markets Stocks were choppy on Wednesday with NASDAQ outperformance after a short squeeze on TSLA (+11%) post-earnings as investors await more big tech earnings reports. However, post the cash market close, META stock is down 15% post earnings send both the NDX and S&P sharply lower this morning. Macro newsflow was on the light side, Durable Goods Orders were more or less as expected, stoking little reaction, while the German IFO Survey came in on the hot side, contributing to a Bund-led sell-off in fixed income. Treasuries bear-steepened themselves, although the losses were seen mainly during the European session, while the lacklustre 5 Year Treasury Auction failed to lead to any meaningful reaction. Dollar Index saw marginal strength, although that was largely a function of the Yen slipping past 155, to little sign of intervention, whilst other currencies held up better; Aussie was bid after its hot inflation figures. Durable Goods in March rose 2.6% from the prior, revised lower, 0.7% and marginally above the expected 2.5%. Ex-Transport rose 0.2% (prev. 0.1%) but was slightly short of the forecasted 0.3%, while Nondefense Cap Ex-Air was in line at 0.2% (prev. 0.4%). Ex-Defense rose to 2.3% from 1.5%. The headline was largely boosted by a 47% surge in the aircraft component, as orders at Boeing rebounded after a weak February. Core capital goods orders, a useful gauge of the underlying trend in capital spending, rose in line with expectations, albeit at a slower pace than in the preceding month. Within core orders, and as Oxford Economics points out, orders for computers and electronics, fabricated metal products, and other durable goods were up. The consultancy further adds “the baseline forecast calls for real equipment spending to decline by 2.7% annualized in Q1, but odds are this weakness will be even greater.” As such, Oxford says their real-time estimate of real equipment spending, based on durable goods shipments and other source data, is pointing to a 5.5% annualised drop in Q1 due in large part to a reacceleration in inflation tied to capital equipment. Elsewhere, Oil prices were lower despite bullish inventory data and the firmer economic data. Gold was little changed.
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For anyone following my Platinum Service it made 260 points yesterday and is now ahead by 3444 points for April after ending March with a gain of 2113 points. February closed with a gain of 1606 points, 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 1.20% higher at a price of 5070.
The Dow Jones Industrial Average closed 263 points higher for a 0.69% gain at a price of 38,503.
The NASDAQ 100 closed 1.51% higher at a price of 17,471.
The Stoxx Europe 600 Index closed 0.43% lower.
This Morning, the MSCI Asia Pacific closed 0.7% lower.
This Morning, the Nikkei closed 2.16% lower at a price of 37,628.
Currencies
The Bloomberg Dollar Spot Index closed 0.10% lower.
The Euro closed 0.1% higher at $1.0712.
The British Pound closed 0.3% higher at 1.2490.
The Japanese Yen fell 0.2% closing at $155.20.
Bonds
Germany’s 10-year yield closed 9 basis points higher at 2.59%.
Britain’s 10-year yield closed 10 basis points higher at 4.34%.
U.S.10 Year Treasury closed 7 basis points higher at 4.66%.
Commodities
West Texas Intermediate crude closed 0.80% lower at $82.81 a barrel.
Gold closed 0.1% lower at $2322.10 an ounce.
This morning on the Economic Front we already had the release of German GFK Consumer Confidence which printed -24.2 versus -26 expected. Next, we have a speech from ECB Member Schnabel at 8.00 am followed by Euro-Zone Economic Bulletin at 9.00 am. At 1.30 pm we have U.S. Weekly Jobless Claims, GDP, Trade Balance and Wholesale Inventories. Finally, we have Pending Home Sales at 3.00 pm and the Kansas City Fed Manufacturing Activity Index at 4.00 pm.
Cash S&P 500
My S&P plan worked well yesterday as the market traded the whole of my buy range for a 5054 average long position before rallying to my revised 5068 T/P level and I am now flat. Although the S&P closed at 5071, weaker than expected earnings and guidance from META post the Cash-Market close sees the S&P trading at 5037 this morning. The S&P has strong support from 5007/5022 where I will again be a buyer with a 4995 tight ‘’Closing Stop’’. I am not going to chase the S&P lower, leaving my 5102/5120 sell level unchanged with the same 5135 ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 5088. If I am taken long, I will have a T/P level at 5037. If this view changes, I will be back with a new update for my Platinum Members.
EUR/USD
No Change. The Euro has support from 1.0590/1.0660 where I will again be a buyer with the same 1.0515 ‘’Closing Stop’’. I still do not want to be short the Euro at this time.
Dollar Index
I am still flat the Dollar as the market again traded in a narrow range below the 106.10 resistance level. Today, I will continue to be a seller of the Dollar from 106.05/106.65 with the same 107.15 ‘’Closing Stop’’. I still do not want to be long the Dollar at this time.
Cash DAX
Overnight, the DAX traded lower to my 18000-buy level. This was a surprise given the fact that when I posted yesterday morning, the DAX was trading over 18200. Continuing with my theme of banking points when available, I have now exited this long position here at 18060 and I am now flat. Today, I will again be a buyer on any dip lower to 17820/17910 with a lower 17735 ‘’Closing Stop’’. Despite the aggressive rally this week, I still do not want to be short the DAX at this time.
Cash FTSE
My FTSE plan worked well as post META, the market traded lower to my 8000-buy level, before rallying this morning to my 8060 T/P level and I am now flat. Today, I will continue to be a buyer on any dip lower to 7920/7990 while leaving my 7865 ‘’Closing Stop’’ unchanged. If I am taken long, I will have a T/P level at 8050. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
The Dow never came close to Wednesday’s sell range and I am still flat. Ahead of key economic data and earnings this evening and tomorrow , I will not chase the Dow lower. We have had an excellent month and there is no need to take aggressive risk. The Dow has further resistance from 38730/38980 where I will again be a seller with a higher 39105 ‘’Closing Stop’’. The 50 Day Moving Average is at 38804 this morning and should act as strong resistance on any initial test. I still do not want to be long 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 NDX has had a wild 24 hours. Yesterday afternoon the NDX hit a high at 17653 before falling almost 400 points, hitting a low this morning at 17275, before bouncing to sit at 17320 as I go to press. The NDX has short-term support from 18060/18210 where I will be a small buyer with a 17955 ‘’Closing Stop’’. Despite the negative price action this morning, I do not want to be short the NDX at this time. If this view changes, I will be back with a new update for my Platinum Members.
March BUND
Global Bond Yields got hit hard yesterday, led by the 10 Basis Point rise in Bund Yield. This move higher in yields saw the Bund sell off to my 130.55 buy level. I am still long with a now lower 131.10 T/P level. I will continue to look to add to this position on any further move lower to 129.75 with a now wider 128.95 ‘’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
Gold missed yesterday’s buy range before rallying to close flat on the day. This morning, I will continue to be a small buyer on any further dip lower to 2280/2295 with a now lower 2259 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 2309. I no longer want to be short Gold at this time.
Silver Rolling Contract
No Change. I am still long Silver at an average rate of 27.30 with the same 27.90 T/P level. I will leave my 25.95 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
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