U.S. Indices ended Friday’s session with slight gains, albeit in thin newsflow on Friday, as the main event of the week came before US players even got to their desks on Monday. That is, the US and China agreed to cut tariffs on each other by 115ppts. Back to Friday, while headlines were light, there was some US data – import/export prices surprisingly rose, albeit marginally, while housing data and the University of Michigan Survey disappointed. On the latter, all major metrics missed and inflation expectations soared, but the usual caveat applies, with the bias of Democrats vs. Republican figures. Elsewhere, the Dollar saw slight gains to the detriment of most G10 FX, while Treasuries chopped to the aforementioned data. The crude complex saw gains amid a lack of progress on Russia/Ukraine and US/Iran nuclear talks. Sectors were predominantly in the green with Health sitting atop of the pile, while Energy and Technology were the only ones in the red. The University of Michigan preliminary data for May disappointed, highlighted by Sentiment tumbling to 50.8 (exp. 53.4, prev. 52.2), Conditions to 57.6 (exp. 59.6, prev. 59.8), and Expectations printing beneath the bottom end of the forecast range at 46.5 (exp. 48.0, prev. 47.3). Inflation expectations also rose, with 1 Year ahead soaring to 7.3% from 6.5%, and 5 Year jumping to 4.6% from 4.4%. The data set notes, “While most index components were little changed, current assessments of personal finances sank nearly 10% on the basis of weakening incomes”. In addition, in commentary, it said tariffs were spontaneously mentioned by nearly three-quarters of consumers, up from almost 60% in April, and that uncertainty over trade policy continues to dominate consumers’ thinking about the economy. The report highlights that the final release for May, due May 30th, will reveal the extent to which the May 12 pause on some China tariffs leads consumers to update their expectations. Moreover, the interviews for this release were conducted between April 22nd and May 13th, closing two days after the announcement of a pause on some tariffs on imports from China. U.S. Import Prices rose unexpectedly in April by 0.1% against the expected decline of 0.4% and downwardly revised prior of -0.4% (prev. -0.1%). In Fuel Imports, prices declined by 2.6%, driven by lower prices for petroleum and natgas, while ex-fuel prices rose by 0.4%, driven by advances in prices for capital goods, nonfuel industrial supplies and materials, consumer goods, and automotive vehicles. Export prices saw the same theme, rising 0.1% (exp. -0.5%, rev. 0.1%), amid a 0.5% move higher in agricultural exports vs the 0.1% rise in all exports, ex ag. Given import/export prices feed into the PCE deflator figure, Oxford Economics noted the inputs “didn’t move the needle on our forecast for the measure to rise 0.1% in April. The Fed will remain sidelined until December as the effects of tariffs filter through the economy”. Housing data for April disappointed, as both Building Permits and Housing Starts fell short of expectations. The former dipped to 1.412 million (exp. 1.45 million, prev. 1.481 million), while housing starts lifted to 1.361 million from 1.339 million, but light of the consensus 1.365 million. The fall in permits was steepest in the South, where Pantheon Macroeconomics notes that building activity has overshot demand in the last couple of years. Ahead, the consultancy notes a further decline in permits looks very likely, given the sharp deterioration in the NAHB survey in May. The ratio of unsold new homes to monthly sales has risen to 8.8 in the three months to March, its highest since December 2022 and well above its average of 6.1 since 1963. As such, Pantheon Macroeconomics continue to look for near-zero growth in real residential investment this year and meagre growth of about 2% in 2026, down from 4% in 2024. Elsewhere, Oil closed 1.41% higher, while Gold was soft ending Friday with a loss of 0.4%.
To mark my 3175th 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 made 322 points on Friday and is now ahead by 2285 points for May after closing April with a gain of 7685 points after closing March with a gain of 2254 points while closing February with a gain of 4180 points. January ended with a gain of 2768 points while 1997 points were gained in December. October ended with a gain of 2179 points, after closing September with a gain of 4402 points, following a loss of 301 points in August. July gained 1908 points while June saw a gain of 2074 points. The Platinum Service made a record 9619 points in October 2022. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 2300 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 0.7% higher at a price of 5958.
The Dow Jones Industrial Average closed 331 points higher for a 0.71% gain at a price of 42654.
The NASDAQ 100 closed 0.43% higher at a price of 21,427.
The Stoxx Europe 600 Index closed 0.42% higher.
This Morning, the MSCI Asia Pacific closed 0.7% lower.
This Morning, the Nikkei closed 0.70% lower at a price of 37,490.
Currencies
The Bloomberg Dollar Spot Index closed 0.10% higher.
The Euro closed 0.3% lower at $1.1157.
The British Pound closed 0.01% lower at 1.3282.
The Japanese Yen rose 0.67% closing at $145.70.
Bonds
Germany’s 10-year yield closed 12 basis points lower at 2.59%.
Britain’s 10-year yield closed 7 basis points lower at 4.65%.
U.S.10 Year Treasury closed 9 basis points lower at 4.45%.
Commodities
West Texas Intermediate crude closed 1.41% higher at $62.49 a barrel.
Gold closed 1.1% lower at $3202.10 an ounce.
This morning on the Economic Front we already have Euro-Zone CPI at 10.00 am. The only U.S. release is the Leading Index at 3.00 pm. Meanwhile, Fed Members: Bostic and Williams are both speaking at 12.30 pm. Finally, Fed Members Logan and Kashkari are speaking at 6.15 pm and 6.30 pm respectively.
Cash S&P 500
The Moody’s downgrade caught nearly everyone off guard on Friday afternoon. Most are dismissing the news as not a big deal, and perhaps it is not. After all, the US has already had two prior downgrades. However, the timing is particularly sensitive, especially given the current negotiations around the tax bill. The key issue is that this downgrade comes at a moment when term premiums were already rising, potentially adding even more upward pressure. At this point, the bond market is essentially in control—and more importantly, it has put the administration in a tight spot. Scott Bessent had been trying unsuccessfully to lower the 10-year rate, and now the market clearly knows how to provoke a response from him and his team. With rates already back to levels seen before the pre-Liberation Day pause, one must assume the market will continue pushing rates higher until it gets a meaningful reaction from the administration. Additionally, rates have already been rising, and given the recent breakout, it is plausible that the 10-year could continue to climb—perhaps back toward 4.6%. It is a similar scenario for the 30-year, which is likely to push above 5%. It has already tested that level twice after breaking out of a bull flag, and we could see another attempt at surpassing that mark. As for the S&P, not much has stopped its recovery so far, but there is also not much good news left to propel it higher. In fact, one could argue the news flow will likely worsen from here, given that the major positive trade news has already been announced. We probably won’t see any trade deals better than the one reached with the UK, and the China trade pause was arguably the largest possible deal. Additionally, President Trump has signaled plans to start assigning specific tariff rates to various countries. On top of that, announcements regarding pharmaceutical and semiconductor tariffs are still pending. If anything, the market’s significant rally has likely given the President the green light to move forward with his tariff agenda. Previously, rising rates, a weakening dollar, and falling stocks were the key factors that prompted the administration’s pause. Now that stocks have recovered most of their losses, it seems like the ideal moment for the administration to advance its tariff plans. With the recent market surge likely driven by repositioning after the trade pause and the announcement of the agreement with China, markets have probably overshot to the upside and are now due for a correction. Considering the post-OPEX landscape coupled with the Moody’s downgrade, conditions seem ideal for a substantial decline. The S&P has left a number of ’Open Gaps’ below. There is every chance that a meaningful sell-off from here could see the 5680 ‘’Open Gap’’ filled ahead of the expected tax cuts. Thursday’s move higher in the S&P saw the whole of my sell range triggered for a 5904 average short position. Friday’s Moody’s downgrade announcement came thankfully ahead of the 10.00 pm Futures Close, allowing me to keep my short position over the weekend. This morning, the S&P is trading lower at 5893. I have now exited my short position here and I am now flat. I would expect some of Friday’s gap to be filled before the market tries to move lower. I will be a seller from 5930/5950 with a higher 5965 ‘Closing Stop’. The 200 Day Moving Average comes in at 5760 this morning. Any dip to this area will attract strong buying. Therefore, I will be a buyer from 5758/5778 with a higher 5735 wider ‘Closing Stop’. If I am taken short, I will have a T/P level at 5907. If I am taken long, I will have a T/P level at 5810.
EUR/USD
I am still flat the Euro as I continue to be a buyer on any further sip lower to 1.1030/1.1110 with the same 1.0965 ‘Closing Stop’. If I am taken long, I will have a T/P level at 1.1190. I no longer want to be short the Euro at this time.
Dollar Index
The Dollar continues to trade in a narrow range and I am still flat. I will leave my 101.60/102.40 sell level unchanged with the same 103.05 ‘Closing Stop’. If I am taken short, I will have a T/P level at 101.10. I will not chase the market higher as I continue to be a buyer on any dip lower to 98.70/99.50 with the same 96.95 ‘Closing Stop’. If I am taken long, I will have a T/P level at 100.20.
Russell 2000
I am still flat. The Russell is trading higher at 2098 this morning. I will continue to be a buyer on any dip lower to 1960/2040 with the same 1895 ‘Closing Stop’. If I am taken long, I will have a T/P level at 2080. I still do not want to be short the market at this time.
FTSE 100
The FTSE is trading 100 points higher from where I marked prices on Thursday morning and I am still flat. I will now raise my FTSE buy level to 8510/8590 with a higher 8445 ‘Closing Stop’. If I am taken long, I will have a T/P level at 8650. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
The Dow has now closed over its 200-Day Moving Average (42286) on both Thursday and Friday. Given the valuations I am not happy about been a buyer of the Dow at these levels. However, given the technical setup, I will be a small buyer from 41970/42220 with a tight 41795 ‘Closing Stop’. If I am taken long, I will have a T/P level at 42450. I still do not want to be short the Dow at this time.
Cash NASDAQ 100
My NDX plan worked well. The NDX rallied to my 21370 sell level before trading lower to my revised 21233 T/P level. Subsequently, I emailed my Platinum Members to sell the NDX again which we di at a price of 21410 before the market sold off to my 21335 T/P level and I am now flat. On the back of the Moody’s downgrade, the NDX is trading lower at 21180 this morning. The NDX is severely overbought, has resistance from 21370/21570 where I will again be a seller with the same 21705 ‘Closing Stop’. If triggered, I will have a T/P level at 21200. I still do not want to be a buyer of the NDX at this time.
December BUND
The Bund is trading 140 points higher from where I marked prices on Thursday morning. I will now raise my buy level to 128.70/129.60 with a higher 127.95 ‘Closing Stop’. I still do not want to be short the Bund at this time.
Gold Rolling Contract
Gold fell shy of Thursday’s buy range before rallying back above 3200. I will now raise my buy level to 3120/3145 with a higher 3099 ‘Closing Stop’.
Silver Rolling Contract
I am still long Silver from last week at 32.20. l will add to this position at 31.40 while leaving my 29.95 ‘Closing Stop’ unchanged. I will now lower my T/P level to 32.70. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
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