U.S. Equities climbed to a new high Monday amid hopes that a partial trade deal between America and China will ease a key risk for investors heading into year-end. Treasuries and the US Dollar fell. With tech and health-care leading the charge, the S&P 500 Index rose in the wake of the agreement, which will see Washington reduce tariffs and Beijing increase purchases of American farm goods, although many details are still to be ironed out. In another positive sign, the Federal Reserve Bank of New York’s survey measure of general business conditions in the next six months jumped to a five-month high. The Stoxx Europe 600 also hit a new peak as it jumped for a fourth day. The U.K.’s FTSE 100 Index reached a 19-week high. Stocks were mixed in Asia, but equities in Shanghai rose after Chinese data showed Industrial Output and Retail Sales both exceeded expectations. Elsewhere, oil hovered near a three-month high and gold held steady. Bitcoin slipped below $7,000.
To mark my 1950th 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 lost 25 points yesterday and is now ahead by 707 points for December, having made 780 points in November, 1649 points in October, 1620 points in September, 2387 points in August, 1153 points in July, 1346 points in June,1722 points in May, 955 points in April and 1027 points in March. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
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The announcement of the preliminary U.S.-China deal staved off a scheduled Dec. 15 tariff hike, a prospect that had loomed large for markets. It remains unclear how China will follow through on pledges to boost American agricultural imports, or how quickly the U.S. promise to roll back half of a September tariff hike will happen. This week should be the last week with any decent volume as investors head for home for Christmas and the New Year’s holiday. Slow volume should also mean modest moves in stocks, so investors should be able to sleep easy and dream of sugar plum fairies to close out a very good year, according to one analyst on Bloomberg. Still, China’s threat of retaliation against Germany if it excludes Huawei Technologies Co. as a supplier of 5G wireless equipment shows that tensions remain high elsewhere. Also, the U.S. spent Monday acting to ease Mexico’s concerns over labour monitors under the USMCA trade deal.
The S&P 500 Index rose 0.7% to close at 3191.
The Nasdaq 100 added 1.0%.
The Stoxx Europe 600 Index advanced 1.4%, the highest on record with its biggest gain in over two months.
The U.K.‘s FTSE 100 Index rose 2.3% to 7519, the highest in more than 19 weeks on the largest climb in almost a year.
The MSCI Asia Pacific Index gained 0.8%,
Currencies
Here is a summary of the main Changes in F.X. Markets:
The Bloomberg Dollar Spot Index declined 0.2%.
The British Pound increased 0.1% to $1.3345.
The Euro climbed 0.2% to $1.1144.
The Japanese Yen depreciated 0.2% to 109.57 per dollar.
Bonds
The yield on 10-year Treasuries climbed six basis points to 1.88%.
Germany’s 10-year yield increased one basis point to -0.29%.
Britain’s 10-year yield gained three basis points to 0.865%, the highest in five months.
Commodities
West Texas Intermediate crude advanced 0.3% to $60.23 a barrel.
Gold was little changed at $1,476.70 an ounce.
This morning on the Economic Front we have UK Unemployment and Average Earnings at 9.30 am. This is followed at 10.00 am by Euro-Zone Trade Balance and the UK CBI Industrial Trends Survey at 11.00 am. At 1.30 pm we have U.S Building Permits and Housing Starts, followed by Industrial Production and Capacity Utilisation at 2.15 pm. Finally, we have the JOLTS Job Openings at 3.00 pm and a speech from Fed Member Rosengren at 5.30 pm.
December S&P 500
The S&P rallied to my 3198 sell level before having a small sell-off into the close. As I am still short the NASDAQ I covered this S&P short position for a small gain at 3196 and I am now flat. This market is now severely overbought with the S&P trading at the top of its Daily Bollinger Band and William Index. The Fear & Greed Index which is based on seven different momentum, strength, breath and volatility indicators, closed at a very uncomfortable reading of 81 last night which implies ‘’Extreme Greed’’. In my opinion we are very close to at least a temporary high in the US Indices. Today my S&P sell level will be from 3203/3215 with a 3225 stop. My only interest in buying the S&P is still on a dip lower to 3153/3165 with a higher 3145 tight stop.
EUR/USD
The Euro again found support at 1.1100 and I am still flat. Today I will raise my buy level to 1.1060/1.1100 with a 1.1025 stop.
March Dollar Index
I have now rolled to the March Contract. The March Contract has resistance from 97.00/97.40 and I will be a seller in this area with a 97.70 stop.
December DAX
Despite the awful economic data out of Germany yesterday the market traded to new all-time highs and I am still flat. Today I will raise my buy level to 13210/13270 with a 13160 stop. I still do not want to be short the DAX at this time.
December FTSE
My FTSE plan was totally wrong yesterday as the market closed the day with a gain of 2.3%. After I went short at 7465 I was quickly stopped out of this position at 7505 and I am now flat. The FTSE is severely overbought trading above its Daily Bollinger Band and at the top of the Williams Index. Today I will again look to sell the market on any further rally to 7555/7595 with a 7630 stop.
Dow Rolling Contract
I am still flat the Dow and today I will mow lower my sell level to 28390/28540 with a lower 28645 stop. Given how overbought the Dow is trading I still do not want to be long the market at this time.
December NASDAQ
The NASDAQ traded higher to my 8580 sell level. I am still short and I will add to this position on any further move higher to 8630 with the same 8675 stop. I will also raise my T/P level on this position to 8550 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
March BUND
I am still flat the Bund as the market had a small sell-off into the close. I will lower my buy level slightly to 171.00/171.40 with a lower 170.55 stop.
Gold Rolling Contract
No Change as I am still a buyer on any dip lower to 1451/1461 with the same 1443 stop.
Silver Rolling Contract
I am still flat Silver and today I will now raise my buy level again to 16.50/16.90 with a higher 16.15 stop. If I am taken long I will have a T/P level at 17.10.
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