European Leaders maneuvered to stop a chaotic no-deal Brexit happening next week, handing the U.K. an extra two weeks. The cliff-edge that investors were dreading has been postponed. But a new cliff-edge looms on April 12 when the U.K. will have to decide on the way forward. April 12 will be the cut – off because it is when the U.K. has to decide whether to take part in EU elections. The EU is increasingly worried about avoiding the blame of a no-deal scenario. Prime Minister May told EU Leaders that she thinks she can get her deal passed. This was met by scepticism. If the U.K. Parliament approves this deal then the U.K. will not leave until May 22, 2019.
To mark my 1800th 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@tradernoblecom for details
For anyone following my Platinum Service it made lost 77 points yesterday and is now ahead by 689 points for March, having made 1013 points in February, 1671 points in January, 2803 points in December, 1541 points in November and 2094 points in October. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
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Currencies
Cable was the biggest mover yesterday which is no surprise given the uncertainty over Brexit. Initially it climbed to 1.32 on some constructive sentiment from Labour but as PM May arrived in Brussels it began to slump hitting a low of 1.3004 as stops were busted in a quick move lower. However with the EU Leader extending the time frame Cable has recovered to sit at 1.3150 this morning.
The EUR/USD reversed most of it’s post FOMC rally to trade to a low of 1.1342 before closing in New York at 1.1378 where is sits this morning. Meanwhile the US Dollar has reversed all of Wednesday’s losses as it rose along with the US Stock Market.
Equities
U.S. Equities reached a five month high as investors reacted to a dovish lurch by policy makers in the World’s biggest economy. After the Federal Reserve announced on Wednesday that it had no plans to raise Interest Rates in 2019, after a delayed reaction, stocks resumed this year’s upward charge. The S&P staged a broad-based advance that saw tech shares climbing alongside the real estate and consumer sectors. The Dow, S&P and NASDAQ recorded gains of 0.85%, 1.09% and 1.50% respectively as the market rebounded from opening lower.
Bonds
Bond Yields rose 2bps with the 10 Year closing at 2.56%. This move higher was initiated by the Philly Fed Index coming in much stronger than the +4.8 expected with a print of +13.7. Meanwhile the Bank of England left Interest Rates unchanged. In Europe the German Bund decreased four basis points to 0.04 percent, which is the lowest rate in more than two years.
Commodities
The stronger Dollar took the shine off Gold and Silver which gave up half their gains from Wednesday while WTI was flat.
This morning on the Economic Front we have German and Euro-Zone Manufacturing PMI at 8.30 am and 9.00 am respectively. This is followed at 12.00 PM by the Bank of England Quarterly Bulletin. Next we have Canadian CPI at 12.30 pm and US Markit Manufacturing PMI at 1.45 pm. Finally at 2.00 pm we have Existing Home Sales and Wholesale Inventories.
June S&P 500
Unfortunately the S&P just fell shy of my 2807 buy level before rallying to my average sell level at 2843. This proved to be the wrong idea as I was quickly stopped out of this position for a loss at 2857 and I am now flat. Yet again the ‘’Buy the Dip’’ has won the day. The next question is are we going to see a melt up in the stock market that makes multiple new highs before we get the inevitable crash. The 3300 area for the S&P is between the 3rd and 4th Standard Deviation which is a possible target for the market and if this happens it would be similar to what happened in Japan in 1989 before it made its all-time high at 39000 that has still remained today with the Nikkei closing at 21,627 this morning. As mentioned yesterday the Daily Sentiment Indicator is signalling a temporary top while the McClellan Oscillator was weak closing at 0 last night. The S&P has resistance from 2872/2885 and I will be a small seller on any rally to this area with a 2893 tight stop. However yesterday’s rally has to be respected and I will now raise my buy level to 2830/2842 with a 2823 stop.
EUR/USD
In contrast to the S&P my Euro plan worked well with the market trading lower to my 1.1350 buy level before rallying to my revised 1.1378 T/P level and I am now flat. Today I will again look to by the Euro on any dip lower to 1.1300/1.1340 with a 1.1255 stop. I still do not want to be short the Euro at this time.
June Dollar Index
Thankfully we had no sell level in the Dollar yesterday and I am still flat. Today I will raise my buy level to 94.80/95.20 with a 94.450 stop.
June DAX
I am still flat the DAX which again failed to follow the US Indices higher. Today I will leave my 11720/11790 sell level unchanged with the same 11845 tight stop.
June FTSE
It took a while buy finally the FTSE traded higher to my 7295 sell level overnight before selling off to my 7270 T/P level and I am now flat. The FTSE is overbought and due a correction. The slight strength in Sterling this morning may hinder the FTSE today. As a result I will again look to sell the market on any further rally to 7300/7350 with a 7385 stop.
Dow Rolling Contract
Frustratingly the Dow just missed my 25535 buy level by 40 points before turning around aggressively to rally 430 points off this low. Thankfully we had no sell level in the Dow yesterday. If the Dow can break and close over 26250 it will eliminate the current negative divergence against both the S&P and NASDAQ. Today I will move my buy level higher to 25650/25820 with a 25580 stop.
June NASDAQ
Yesterday after the NASDAQ traded higher to my 7450 sell level I emailed my Platinum Members to exit any short position at 7440 and I am still flat. My counter trade sell levels in the NASDAQ have worked nicely over the past few days but this mood in the market changed yesterday with the market closing a hefty 1.50% higher. My next target level for the NASDAQ is 7700. Today I will be a buyer on any dip lower 7340/7410 with a 7290 stop.
June BUND
No Change as I am still a seller on any rally higher to 165.10/165.50 with a 165.85 stop.
Gold Rolling Contract
I was right to be suspicious of Gold’s move higher on Wednesday with the market falling from a high of 1321 yesterday morning to an afternoon low of 1305. Today I will be a small buyer on any further dip to 1291/1298 with a 1284 stop.
Silver Rolling Contract
No Change as I am still a buyer on any dip lower to 15.00/15.35 with a 14.65 stop and a lower 15.50 T/P level if executed.
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