U.S. Equity Markets ultimately closed Tuesday mixed with notable outperformance in the NASDAQ ahead of key earnings, while the heavyweights printed notable gains (ex-TSLA) while Broadcom (AVGO) rallied on reports that the Company is developing an AI inference chip with OpenAI. The gains saw Communications and Technology heavily outperform, while all other sectors were red, with underperformance in Utilities, Energy and Consumer Staples. The focus is largely on earnings with plenty of heavy hitters (GOOGL, AAPL, AMZN, META, MSFT, INTC, AMD) due over the next couple of sessions, alongside key US data points (PCE, GDP, NFP). T-Notes ultimately settled flat with yields marginally lower across the curve in a steeper fashion but in choppy trade. T-Notes sold off on China stimulus reports and a continuation of the Trump Trade before seeing a knee-jerk reaction higher on a dovish JOLTS report which fell beneath all analyst forecasts, however, the move was short-lived as analysts highlight it was likely influenced by Hurricane Helene. Better selling resumed ahead of the 7-year auction, which ultimately came in very strong which then saw T-Notes rally into settlement to wipe out earlier losses. In FX, the Dollar danced to the tune of yields but Sterling outperformed ahead of today’s budget while the Australian Dollar lagged despite an initial bid to the aforementioned China stimulus measures with participants still doubtful it will be enough as it so far lacks measures to support demand. Meanwhile, energy prices settled in the red on Axios reports Netanyahu will hold a discussion with several ministers and senior officials regarding the contacts for a political settlement to end the war in Lebanon. However, tensions do still remain with the Israeli Chief of Staff warning if Iran makes a mistake and launches missiles at Israel, they will respond strongly on places they excluded in the previous strike. The US JOLTS report was a dovish one. The headline Job Openings fell to 7.443 million from the prior revised down 7.861 million, well beneath the consensus of 8.0 million and beneath the lowest analyst forecast of 7.775 million. This saw the vacancy rate fall to 4.5% from 4.7%, while the quits rate fell to 1.9% from 2.0%. Although the headline saw a notable miss, Oxford Economics highlighted that the drop in opening was concentrated in the South and likely driven by Hurricane Helene. The desk also noted that the pace of hiring picked up, lending some upside risk to their forecast for October payroll growth (currently expected at 115k). Meanwhile, in regard to wages, OxEco points out the drop in the quits rate was to the lowest level since the pandemic and that the steady decline of the quits rate recently is consistent with wage growth continuing to slow. U.S. Consumer Confidence came in strong as it printed, 108.7, well above the expected, 99.5, and the prior, 99.2, and also above the upper end of the forecast range. Within the report, the Present Situation index rose by 14.2 points to 138.0, while the Expectations Index increased by 6.3 points to 89.1. Delving deeper into the release, consumers’ assessments of current business conditions turned positive in October, while jobs plentiful rose M/M and jobs hard to get fell. Looking ahead, consumers were more optimistic about the business conditions outlook in October. On the data set, Chief Economist of the conference board noted that the headline recorded the strongest monthly gain since March 2021, but still did not break free of the narrow range that has prevailed over the past two years. In October’s reading, all five components of the Index improved, with views on the current availability of jobs rebounding after several months of weakness, potentially reflecting better labour market data. Compared to last month, consumers were substantially more optimistic about future business conditions and remained positive about future income. Also, for the first time since July 2023, they showed some cautious optimism about future job availability. Elsewhere, Oil closed higher by 0.25% while Gold surged to new all-time highs with a gain of 1.15%.
To mark my 3075th 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 Made 40 points yesterday and is now ahead by 2096 points for October after ending September with a gain of 4402 points following a 301-point loss for August after closing July with a gain of 1918 points while June closed 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 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 0.16% higher at a price of 5832.
The Dow Jones Industrial Average closed 154 points lower for a 0.36% loss at a price of 42,233.
The NASDAQ 100 closed 0.98% higher at a price of 20,550.
The Stoxx Europe 600 Index closed 0.49% lower.
Yesterday, the MSCI Asia Pacific closed 0.5% higher.
Yesterday, the Nikkei closed 0.77% higher at a price of 38,903.
Currencies
The Bloomberg Dollar Spot Index closed 0.05% lower.
The Euro closed 0.05% higher at $1.0818.
The British Pound closed 0.3% higher at 1.3015.
The Japanese Yen fell 0.1% closing at $153.33.
Bonds
Germany’s 10-year yield closed 5 basis points higher 2.34%.
Britain’s 10-year yield closed 5 basis points higher at 4.31%.
U.S.10 Year Treasury closed 2 basis points lower at 4.25%.
Commodities
West Texas Intermediate crude closed 0.25% higher at $67.53 a barrel.
Gold closed 1.15% higher at $2773 an ounce.
This morning on the Economic Front we have German Unemployment at 8.55 am and GDP at 9.00 am. Next, we have Euro-Zone GDP and the Economic Sentiment Indicator at 10.00 am, followed by U.S. MBA Mortgage Application at 11.00 am. This is followed by the ADP Employment Change at 12.15 pm and GDP at 12.30 pm. At 1.00 pm we have German CPI followed by U.S. Pending Home Sales at 2.00 pm. Finally, we have a speech from ECB Member Schnabel at 3.00 pm and a speech from Bank of Canada Governor Macklem at 8.15 pm.
Cash S&P 500
The level of debt continues to increase at an unstainable pace. The Fed is back in full stimulus mode and on that basis with market valuations are so high one could easily argue we are right back in one massive asset bubble. No matter who wins the Presidential Election next week either candidate has no choice but to continue to increase debt levels as nobody wants to take fiscal responsibility on their watch as it will lead to the inevitable crash like we had in 1987 and again in 2007. Nobody knows when this market is going to break but as I said yesterday when we see the number of well-respected traders short the Treasury Market and long the U.S. Dollar you have to respect their views. Paul Tudor Jones is one of the most respected traders out there and I have been following his work since he opened ‘’FINEX’’ the open outcry trading centre in Dublin back in 1995 when I was a floor trader on the exchange. My strategy is to continue to sell rips against new highs with a tight T/P level if triggered. I will be a strong buyer of dips per my macro levels that I shared with you in Tuesday’s commentary. Today, I will continue to be a seller on any further rally to 5878/5896 with the same 5911 ‘’Closing Stop’’. The S&P has short-term support from 5770/5786 where I will be a small buyer with a 5759 ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 5864. If I am taken long, I will have a T/P level at 5800.
EUR/USD
The boring sideways price action in the Euro continues. I am still long at an average rate of 1.0830 from last week with the same 1.0875 T/P level. There is no doubt that the Euro is severely oversold and due at least a bounce to offset its oversold condition. I will leave my 1.0745 ‘’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
No Change: I am still short the Dollar from last week at a price of 103.95 with the same 103.50 T/P level. I will add to this position on any further move higher to 104.75 while leaving my 105.25 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash DAX
I am still flat the DAX as the market never came close to yesterday’s sell range before trading lower. The DAX continues to make lower highs which technically is never a happy outcome for anyone buying the market. Germany is in recession and in my opinion has no right to be trading close to its all-time high. However, as we know selling the market on any dip has been costly. I will now lower my sell level to 19640/19740 with a lower 19835 ‘’Closing Stop’’. I still do not want to be long the DAX at this time. If this view changes, I will be back with a new update for my Platinum Members.
Cash FTSE
Frustratingly the FTSE missed Tuesday sell range by just 20 points before falling 130 points off its morning high into the New York close and I am still flat. The FTSE has short-term support below from 8100/8170 where I will be a buyer with an 8035 ‘’Closing Stop’’. Ahead of today’s Budget I no longer want to be short the FTSE at this time. If this view changes I will be back with a new update for my Platinum Members.
Dow Rolling Contract
The Dow just missed my initial 42100 buy level before having a small rally into the close. While the NDX closed higher by 1% the Dow continues to trade heavy as shown by Tuesday’s 0.36% fall. Ahead of this afternoon’s key economic data I will now lower my Dow buy level to 41750/42000 with a lower 41595 ‘’Closing Stop’’. If triggered, I will have a T/P level at 42180.
Cash NASDAQ 100
I am still flat the NDX despite yesterday’s 1% rally. Ahead of this afternoon’s key GDP data I will now raise my NDX sell level to 20720/20880 with a higher 21005 ‘’Closing Stop’’. Despite the NDX outperforming over the past couple of trading sessions I no longer want to be a buyer of 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 20610.
December BUND
Treasury Yields hit a high at 4.35% which is a huge 80 basis point move higher since the pre FOMC Meeting on September 17 before selling off 10 basis points on the back of the stronger than expected 7-year Treasury Auction. Hedge Funds are now sitting on massive losses on these original long positions especially as the cost of holding these Bonds versus the overnight rate is significant. The latest rise in Yields saw the Bund hit my buy range for a now 132.50 long position. I will continue to look to add to this position on any further mover lower to 131.70 while leaving my 130.95 ‘’Closing Stop’’ unchanged. I will now lower my T/P level to 133.05. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
No Change: All year Gold rallies then consolidates before making a new high then rinse and repeat. However, with Gold up 30% so far this year you have to wonder given how overbought the market is how further can Gold run without a meaningful correction. Gold has resistance from 2798/2818 where I will be a small seller with a 2833 tight ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 2784. I would rather wait for a correction before setting a new long position. If this view changes I will be back with a new update for my Platinum Members.
Silver Rolling Contract
Silver just missed my 34.60 T/P level before trading lower to my revised 34.30 T/P level on my latest 33.90 long position and I am now flat. Silver has support from 32.70/33.50 where I will again be a buyer with the same 31.55 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 34.20.
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