Four hours before an estimate 100 million Americans tuned in to watch the two wannabe leaders of the free world go head to head, a Bloomberg poll published just before the close of the New York stock market last evening showed Clinton and Trump tied at 46%. The same poll also puts Trump ahead of Clinton once third party candidates are included. The news made a mark, with US stocks closing 0.86% lower and the VIX ”fear gauge” up over two points or some 18%. US Bond Yields are lower again with 10 Year Treasuries closing at 1.58%. However in a fiercely contested debate which last over 90 minutes the consensus is that Clinton won leading to a surge in equity futures overnight led by Asian stocks. The Mexican Peso rallied over 2% on this news.
Due to the number of members taking up my 2 year Euro 2500 rate for my Platinum Service, this will be the last week that I am offering this special price which will rise to Euro 2750 on Saturday. If anyone is still interested in this deal which has been in situ since January, can you please email me on bryan@tradernoble.com for details.
For anyone following my Platinum Service it made 150 points yesterday and is now ahead by 777 points for September having made 1782 points in August and 1682 points in July. The previous three months saw gains of 2550, 1532 and 2175 points respectively. Since I started this Platinum Service in June 2015 it has averaged a monthly gain of over 2000 points.
Weaker stocks were not all about the US, with European Indices pressured lower by fresh record lows for Deutsche Bank as markets continue to fret over the need for Europe’s biggest bank to have to raise fresh capital. The Eurostoxx 50 closed 1.9% lower with the German DAX down by 2.2%.
The strongest currency in the World yesterday, and by some margin, is the Japanese Yen, USD/JPY down by 0.7% relative to Friday’s New York close to 100.30. This is partly on the Yen’s pre-eminent safe-haven characteristics, though USD/JPY was already under pressure after BOJ Governor Kuroda spoke in Osaka. While underscoring his determination to use all possible policy means to achieve its inflation goals, he did nothing to assuage deepening market conviction that the policy instruments and settings announced last week won’t do it. We also had former MoF czar, Sakakibara on TV yesterday afternoon saying he thought USD/JPY at 95/100 would be alright for the Japanese economy and that he expected it to gradually appreciate to around 90.00 next year.
Meanwhile the Canadian Dollar weakened a further 1% despite the rise in oil prices with Brent and WTI closing $1 higher on optimism that a production accord can be reached as OPEC Ministers meat informally in Algiers.
This morning on the economic front we already had the release of German Import prices which fell 0.2% versus -0.1% expected. At 9.00 we have Euro-Zone M3 Money Supply and this is followed at 11.00 am by UK CBI Reported Sales. Next we have US Markit Services/Composite PMI at 2.45 pm. Finally at 3.00 pm we have the US Consumer Confidence Index and the Richmond Fed Manufacturing Index.
The Fed’s Fischer is speaking at 4.15 pm.
December S&P 500
The S&P had a volatile past 24 hours trading as the week started out with another lower gap open, this time from Chicago’s rebound 2149.50 high to last Friday’s close at 2159. Overnight the S&P made a low at 2133.25 before rebounding to a 2154 high print so far on the consensus view that Clinton won the TV debate with Trump overnight. The next debate will be on October 9th with the final one 10 days later on October 19th. My S&P plan worked well yesterday with the S&P trading lower to my 2145 buy level shortly after I posted before rebounding to my revise 2149 T/P level. Subsequently I emailed my Platinum Members to re-buy the S&P at 2142 before the market rallied to its afternoon high at 2149.50 which enabled me to cover this position too early at 2144 and I am still flat. No matter how weak the economic news the market nearly always rallies on the ”hope trade” making it so difficult to be short stocks. The one market we are going to have to keep an eye on is the Mexican Peso which be a good gauge of how the Presidential Election is panning out. This morning the S&P Futures market is again gaping higher and today I will look to buy the S&P on any dip lower to 2137/2143 with a tight 2132 stop. If I am taken long and subsequently stopped out of this position, or I manage to T/P on any long position, either way I will be an aggressive buyer on any dip lower to 2120 with a 2113 tight stop. Despite the McClellan Oscillator again weakening last night closing with a negative 42 print, I am still not comfortable in being short the S&P at this time.
EUR/USD
I am still flat the Euro and today I will now raise my buy level slightly to 1.1180/1.1210 with a 1.1145 tight stop. I still do not want to be short the Euro at this time.
December Dollar Index
No change as I will still look to sell the Dollar on any rally higher to 95.75/96.05 with a 96.35 tight stop. Remember as mentioned in yesterday’s commentary a break and close below 94.80 could well see the Dollar accelerate to the downside.
December DAX
Once it became clear that Deutsche Bank was again on the defensive as the share price closed over 6.5% lower yesterday, I emailed my Platinum Members to lower their buy level in the DAX to 10350 which would have obliged for those members with a spread betting account as the Futures Market did not hit this level. I operate two trading accounts myself, one is a spread betting account where I trade in small size to get my edge and the other is a Futures Account where I do my main trading without having to pay any spread on these trades. However on a Futures Account you have to pay a small commission on each trade and the margin requirement is much higher. After the DAX hit my buy level the market quickly rebounded with the DAX subsequently hitting my tight 10395 T/P level and I am now flat. Today I will again look to buy the DAX on any dip lower to 10310/10360 with a 10265 tight stop. I still do not want to be short the DAX at this time.
December FTSE
My FTSE plan worked well with the market initially hitting my 6785 buy level before eventually rallying to a 6865 high print overnight. Having bought the market I covered this position at 6800 before again getting my Platinum Members to re-buy the market at 6780. As I wanted to be flat ahead of the Presidential debate I covered this position at my revised T/P level at 6795 and I am still flat. The FTSE is beginning to sell-off again as I write this commentary and today I will again look to buy the S&P on any dip lower to 6730/6760 with a 6695 stop.
Dow Rolling Contract
My Dow plan also worked well with the market hitting my 18110 buy level before rebounding to an initial high at 18180. As I had so many open positions at that time plus the fact that I want to keep banking points when available I covered my long position too early at 18125 and I am still flat. Today my only interest in buying the Dow is on a dip lower to 18080/18130 with a 18030 stop.
December BUND
I am still short the BUND from last Friday at 165.20 with the same 165.75 stop which just missed yesterday with a 165.74 high print. I am not comfortable in being short the BUND and I will now look to exit this position on any dip lower to 165.48 and go flat. If I manage to exit this position at either level I will then look to go short on any spike higher to 165.95/166.15 with a 166.40 stop.
Gold Rolling Contract
No change as I am still a buyer on any dip lower to 1317/1325 with the same 1309 stop. The Commitment of Traders data remains compatible with a short term rally that is in it late stages, while the Daily Sentiment Index is consistent with a short term rally that I do not believe is finished yet. Either way the key resistance for Gold is the 1375 high from July 6.
Silver Rolling Contract
No change as I am still long at an average rate of 19.63 with the same 18.95 stop.
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