It was ultimately a rather uneventful session on Monday with the US highlight being mixed inflation expectations from the New York Fed SCE (see below). Meanwhile, over the weekend, a surprise French election result initially weighed on the Euro and EGBs, and in sympathy Treasuries, but the moves gradually pared throughout the rest of the session. In FX, the Dollar Index was ultimately flat and traded either side of 105.00 while the Japanese Yen initially saw strength on rising wages, but the move pared with USD/JPY briefly reclaiming 161.00. Gold prices unwound the post-NFP gains on the PBoC refraining from more gold buys for the second consecutive month while oil prices were sold on ceasefire hopes with Hurricane Beryl in focus as it hits Texas. Looking ahead, Fed Chair Powell is to testify in the Senate on Tuesday and House on Wednesday, with focus turning to US CPI on Thursday, with US 3-, 10-, and 30-Year supply scheduled throughout the week ahead of the start of the Q2 earnings season on Friday. NY Fed Survey of Consumer Expectations for June saw the 1 Year ahead move lower to 3.0% from May’s 3.2%, the 3 Year moved slightly higher to 2.9% (prev. 2.8%), while the longer-term 5 Year also came in lower at 2.8% (prev. 3.0%). Elsewhere within the release, June expected home prices rose at 3% (prev. 3.3%), while consumers see slower expected price gains for rent, food, medical, care, college, and gas. Looking ahead, June expected year-ahead earnings growth was the best since Sept’ 23, while perceptions of the household financial situation lost ground in June. By way of comparison, the University of Michigan’s final June data saw 1 Year inflation expectations fall to 3.0% Y/Y from 3.3%, while the 5-10 Year measure fell to 3.0% Y/Y from 3.1%. Meanwhile, Fed Chair Powell will give his dual testimonies to Congress on this afternoon (to the Senate Banking Committee) and Wednesday (to the House Financial Services Committee), both due to start at 10 am Eastern Time. Powell will be testifying in his capacity as Fed Chair, and therefore, what he says is likely to reflect the overall feelings of the Committee (his remarks to the House will likely be a copy-and-paste of his remarks to the Senate). Elsewhere, Oil closed Monday with a loss of 1% while Gold was also weak, ending yesterday in New York 1.6% lower.
To mark my 3025th 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 was flat yesterday and is still ahead by 243 points for July after closing June with a gain of 2074 points, 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 0.10% higher at a price of 5572.
The Dow Jones Industrial Average closed 31 points higher for a 0.08% loss at a price of 39,344.
The NASDAQ 100 closed 0.23% higher at a price of 20,439.
The Stoxx Europe 600 Index closed 0.04% lower.
This Morning, the MSCI Asia Pacific closed 0.4% higher.
This Morning, the Nikkei closed 1.96% higher at a price of 41,580.
Currencies
The Bloomberg Dollar Spot Index closed 0.13% higher.
The Euro closed 0.1% lower at $1.0824.
The British Pound closed 0.1% lower at 1.2805.
The Japanese Yen rose fell 0.05% closing at $160.80.
Bonds
Germany’s 10-year yield closed 1 basis points lower 2.53%.
Britain’s 10-year yield closed 1 basis points lower at 4.12%.
U.S.10 Year Treasury closed 1 basis points higher at 4.29%.
Commodities
West Texas Intermediate crude closed 0.96% lower at $82.36 a barrel.
Gold closed 1.6% lower at $2356 an ounce.
This morning on the Economic Front we have a speech from ECB Member Cipollone at 10.00 am, followed by U.S. NFIB Business Optimism Index at 11.00 am. Next, we have a speech from Fed Member Barr at 2.15 pm. At 3.00 pm Fed Chair Powell testifies before Congress on the Economy and Monetary Policy. Finally, we have a Three-Year Treasury Auction at 6.00 pm and a speech from Fed Member Bowman at 6.30 pm.
Cash S&P 500
Following yesterday’s extremely quiet trading session for the S&P, I expect volatility to pick up for the rest of the week. For one we have two days of Fed Chair Powell giving his congressional testimony this afternoon and again tomorrow. Also, today we have the bonus feature of Treasury Secretary Yellen who is also before the House Financial Services Committee. In short: headlines galore. I am sure that Powell will get peppered about rate cuts and he will claim independence and data dependency while at the same time urgency is starting to creep in as evidence of a rapidly slowing economy is mounting. My view remains that Powell is looking for an excuse to cut, which of course brings me to Thursday’s CPI Report followed by PPI on Friday. Also, on Friday we get the first set of earnings for Q3 when banks start to report. In other words, we have plenty of potentially market impacting headlines coming our way. With RSIs so overbought and negative divergences everywhere we have the setup for a major correction. It simply should not surprise to see a large correction unfold into the Fall. The question is the when and where. Beneath the market we have a terrifying sized rising wedge with weak internals. Yet nothing has mattered given the extreme concentration in a handful of stocks that keep distorting the market’s true performance. Dean Christians from SentimentTrader.com reports that the percentage of S&P 500 stocks outperforming the S&P 500 Index over a rolling 21-day period is the lowest in history. On top of that, measures of market volatility show an epic complacency toward the potential for a market decline. Taken together and with an RSI closing above 77 last night, the potential remains for a major stock sell-off. I am still short at an average rate of 5550 with no stop for now. I will now raise my T/P level to 5542. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
EUR/USD
Who would have thought that following the French Elections that the Euro would only trade in a 20-point range. I find this incredible given the increased political risk in France. Today, I will continue to be a buyer on any dip lower to 1.0710/1.0780 with the same 1.0645 ‘’Closing Stop’’. I still do not want to be short the Euro at this time.
Dollar Index
The Dollar traded in a 20-point range yesterday and I am still flat. The Dollar has resistance from 105.40/106.10 where I will continue to be a seller with the same 106.65 ‘’Closing Stop’’.
Cash DAX
Frustratingly the DAX missed yesterday’s sell range by less than 20 points before falling 160 points and I am still flat. I will now lower my sell level to 18590/18690 with a lower 18805 ‘’Closing Stop’’. Despite the positive price action over the past few weeks, I no longer want to be a buyer of the DAX at this time. If this view changes I will be back with a new update for my Platinum Members.
Cash FTSE
No Change. I am still long the FTSE at a price of 8190. I will add to this position on any further move lower to 8080. I will have no stop on this position given the massive support below in 7900/8100 area. In this range we have the 2023 highs, the 100 Day Moving Average and close to the .382 fin retracement. I will now lower my T/P level on this position to 8240. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dow Rolling Contract
I am still flat the Dow. The Dow hit a high at 39644 shortly after the markets opened yesterday afternoon before falling 300 points into the close. Despite the strength of both the NDX and S&P, I will not chase the Dow higher as I continue to be a buyer on any dip lower to 38830/39080 with the same 38695 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 29230.
Cash NASDAQ 100
Overnight the NDX rallied to my second sell level at 20460 for a now 20390 average short position. I will now raise my T/P level on this position to 20280 while leaving my 20555 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
September BUND
The Bund traded in a narrow range since I posted yesterday morning. I am still flat as the market never came close to Monday’s buy range. I will now raise my buy level to 129.90/130.70 while leaving my 129.15 ‘’Closing Stop’’ unchanged. If triggered, I will have a T/P level at 131.25.
Gold Rolling Contract
Gold reversed a lot of Friday’s gains, trading at a price of $2360 as I go to post. Ahead of Powell’s key Testimony to Congress this afternoon, I will now lower my Gold buy level to 2316/2332 with a lower 2305 ‘’Closing Stop’’. If triggered, I will have a T/P level at 2344.
Silver Rolling Contract
I am still flat as Silver has reversed some of Friday’s gains. Silver has support from 29.40/30.20 where I will continue to be a buyer with the same 28.25 ‘’Closing Stop’’. If triggered, I will have a T/P level at 30.85.
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