In a day of quiet news flow, U.S. Equity Markets were mixed with clear divergence seen (SPX -0.2%, DJIA +0.8%) as the small-cap Russell 2000 (+0.6%) outperformed and the tech-heavy Nasdaq 100 (1.15%) notably lagged amid headwinds from AI-darling Nvidia (NVDA) (-6.5%) who saw a third consecutive day of losses, which saw Technology reside as the distinct sectorial laggard, with almost all others in firmer territory. In FX, the Dollar Index was seemingly weighed on by month-end/quarter flows; Barclays’ model shows strong Dollar selling, with Citi Bank also estimating month-end USD selling slightly above the historical norm. As such, the EUR benefitted and was the G10 outperformer, despite the poor German IFO in the European morning, weighed on by forward-looking expectations. WTI and Brent profited off the weaker Dollar and extended on last week’s gains, in lack of any fresh crude-specific impulses aside from some punchy geopolitical rhetoric. Treasuries were little changed across the curve ahead of supply and PCE data although a rally was seen on the closing bell, perhaps related to unconfirmed reports of a US drone being shot down in the Black Sea (emphasis on unconfirmed). Fed speak came via Goolsbee, Daly, and Mester but little new was said with no market reaction although Mester did suggest she would be open to active MBS sales at one point; however, she is retiring soon. Amid no tier 1 data releases on Monday, participants await them later in the week with the highlight coming on Friday via core PCE, with a raft of Fed speak filling the space in between. The Q1 final estimate of GDP and May Durable Goods data is also due on Thursday. Note, US banks (JPM, C, WFC, BAC, MS, GS etc.) saw some upside on a Bloomberg sources report that the Fed is floating a weaker version of the bank-capital overhaul. Fed Member Mester said that the Fed should keep an open mind to active mortgage bond sales as part of its effort to reduce the size of its balance sheet. While any action is not imminent, she said at some point she would be open for the FOMC to sell MBS. Meanwhile the Fed’s Daly said the Fed has made a lot of progress on inflation but there is still work to do, inflation is not the only risk although they are nearer to a point where a benign outcome on the labour market could be less likely. Furthermore, in her text release she said that if inflation falls more slowly than expected, the policy rate must stay higher for longer. On the flip side, she said that if inflation falls rapidly or the labour market softens more than expected, lowering the policy rate would be necessary. In the Q&A, the San Fran President noted at this point the risks to inflation and employment mandate are in better balance, and she added it is very clear monetary policy is restrictive. In addition, Daly stated they must be thoughtful about not loosening too early, or holding too long, and that pre-emptive cutting is something you do when you see risks, but right now the labour market is good. Overall, Daly did little to change the tone of recent Fed speak with all eyes to core PCE on Friday. Elsewhere, Oil ended Monday with a gain of 1.09% while a weaker Dollar saw Gold end the day with a 0.7% gain.
To mark my 3000th issue of TraderNoble Daily Commentary I am offering a special 2-Year Rate of Euro 2750 for my Platinum Service which includes 1 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 225 points yesterday and is now ahead by 1893 points for June, having made 1843 points in May. The Platinum Service made 4010 points in 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 to 4 updated emails throughout the trading day to demonstrate this value, a 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 0.31% lower at a price of 5447.
The Dow Jones Industrial Average closed 260 points higher for a 0.67% gain at a price of 39,411.
The NASDAQ 100 closed 1.15% lower at a price of 19,474.
The Stoxx Europe 600 Index closed 0.73% higher.
Yesterday, the MSCI Asia Pacific closed 0.5% higher.
Yesterday, the Nikkei closed 0.54% higher at a price of 38,804.
Currencies
The Bloomberg Dollar Spot Index closed 0.31% lower.
The Euro closed 0.3% higher at $1.0735.
The British Pound closed 0.3% higher at 1.2687.
The Japanese Yen rose 0.1% closing at $159.60.
Bonds
Germany’s 10-year yield closed 2 basis points higher 2.42%.
Britain’s 10-year yield closed 1 basis points lower at 4.08%.
U.S.10 Year Treasury closed 1 basis points higher at 4.27%.
Commodities
West Texas Intermediate crude closed 1.09% higher at $81.61 a barrel.
Gold closed 1.1% lower at $2322 an ounce.
This morning on the Economic Front we have no data of note from either the Euro-Zone or the U.K. At 12.00 pm we have a speech from Fed Member Bowman, followed by the Chicago Fed National Activity Index. Also, at 1.30 pm we have Canadian CPI. This is followed by U.S. Housing Price Index, Consumer Confidence and the Richmond Fed Manufacturing Index at 3.00 pm. Finally, we have a speech from Fed Member Cook at 5.00 pm and a two-year Treasury Auction at 6.00 pm.
Cash S&P 500
A late sell-off saw the S&P close below 5450. However, 70.6% of the stocks comprising the Index closed the day higher, while the NYSE up volume was 71.7% of the total volume. By these measures, the market was stronger internally than the S&P’s closing number suggests. The 20-Day Moving Average for the S&P comes in at a price of 5385 this morning. Any test of this key support line will be met by strong buying initially in my opinion. Yesterday my S&P plan worked well as the market rallied to my 5485-sell level before selling off to my revised 5471 T/P level and I am now flat. I no longer want to be short the S&P especially ahead of PCE and Month/Quarter End on Friday. I will continue to be an aggressive buyer on any dip lower to 5412/5428 with the same 5399 ‘’Closing Stop’’.
EUR/USD
The Euro had a nice rally yesterday. This move higher saw my 1.0715 TP level triggered on my latest 1.0675 long position and I am still flat. Today, I will again be a buyer on any dip lower to 1.0610/1.0690 with a now lower 1.0555 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 1.0740.
Dollar Index
The sell-off in the Dollar saw my 105.45 T/P level triggered on Friday’s late 105.90 short position and I am still flat. This morning, the Dollar is trading at 105.55. We have short-term resistance from 105.90/106.60 where I will again be a seller with the same 107.05 ‘’Closing Stop’’.
Cash DAX
The DAX followed the Dow higher yesterday, ignoring the aggressive sell-off in the NASDAQ. Thankfully, we have had no sell levels in this market as no matter what the news buyers keep showing up on any dip. This morning, the DAX is trading at a price of 18205. Despite the positive price action in the DAX since last week, I still do not want to chase the market higher. Therefore, I will continue to be a buyer on any dip lower to 17900/17990 with a higher 17795 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 18070.
Cash FTSE
The FTSE again just missed my buy level before rallying and I am still flat. The FTSE has short-term support from 8150/8220 where I will be a small buyer with a higher 8085 ‘’Closing Stop’’. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
Last week’s trend swap between the NASDAQ and the Dow continued through yesterday. While the NASDAQ 100 closed lower by 1.15%, the Dow rallied 260 points, ending Monday with a gain of 0.67%. Thankfully we have had no sell level in the Dow over the past 10 days as the market has now rallied 1500 points since the low on May 30. As long as the Dow not close below 38,000 then all rallies will attract buyers. The Dow has short-term support from 38970/39230. I will now raise my buy level to this area with a higher 38795 ‘’Closing Stop’’. I still do not want to be short the Dow at this time.
Cash NASDAQ 100
Nvidia’s share price is down over 16% in three days and the NASDAQ which is heavily influenced by this stock is down 600 points from Thursday’s latest all-time high at 20077. The 20 Day Moving Average for the NDX comes in at a price of 19250 this morning. I will be a strong buyer of the NDX from 19210/19370 with a wider 19095 ‘’Closing Stop’’. Just like both the S&P and Dow I no longer want to be short the NDX sat this time. If this view changes, I will be back with a new update for my Platinum Members.
September BUND
The Bund traded in a narrow 45-point range yesterday and I am still flat. I will continue to be a buyer on any dip lower to 131.50/132.10 with the same 130.95 ‘’Closing Stop’’. I no longer want to be short the Bund at this time.
Gold Rolling Contract
Following Friday’s sell-off, Gold traded in a narrow range yesterday and I am still flat. I still have no edge in Gold at this time. I do not want to chase the market higher, preferring to only be a buyer on any dip lower to 2272/2288 with the same 2259 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 2302.
Silver Rolling Contract
No Change. Silver traded in a narrow range yesterday and I am still flat. Today, I will continue to be a buyer on any dip lower to 28.20/29.00 while leaving my tight 27.55 ‘’Closing Stop’’ unchanged. If I am taken long, I will have a T/P level at 29.70.
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