U.S. Equity Markets headed into the Holiday Weekend on a positive note after the release of steady if uninspiring figures for retail sales and as investors continued to weigh contrasting data from China on the spread of the coronavirus. Treasuries advanced. The S&P 500 Index closed at a record high on below-average volume after swinging between small gains and losses throughout Friday’s session. Energy and consumer discretionary stocks slipped, while investors crowded into tech, utilities and real estate. Even with the coronavirus outbreak dominating the news, the benchmark managed to score its second straight weekly gain. Oil rose above $52 a barrel in New York, and the US Dollar kept close to its level versus a basket of peers. Gold gained and the Japanese Yen held steady. U.S. Retail Sales climbed in January for a fourth straight month — though the prior month’s gain was revised lower — while consumer sentiment hit its highest since 2018. The Stoxx Europe 600 Index closed lower Friday but was also up for the week. The Euro steadied near a 2017 low after data showed the region’s economy grew a scant 0.1% in the fourth quarter, matching forecasts. Major Asian equity markets climbed except for those in Tokyo and Mumbai. While Beijing reported a smaller increase in virus cases in the epicenter of Hubei versus the previous day, they were still more than before counting methodology was changed. That’s clouded the picture of the outbreak in a week that’s seen Chinese airlines put workers on leave and firms such as drugmaker AstraZeneca Plc warn of a tougher outlook because of the disease.
To mark my 2000th 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 70 points last Friday and is now ahead by 726 points for February, having made 2142 points in January, 818 points in December, 780 points in November, 1649 points in October, 1620 points in September and 2387 points in August. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
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Equities
Investors anticipate a possible V-shaped economic recovery from the virus, even as the effects continue to be felt. Nearly 86,000 domestic and international flights in and out of China were cancelled from Jan. 23 to Feb. 11. That’s 34% of scheduled services. Hubei reported almost 5,000 new cases, a day after confirming nearly 15,000. The death toll in China was at 1,380, lower by more than 100 to account for some double-counting. The World Health Organization has said the surge in diagnoses didn’t necessarily indicate a spike in infections.
The S&P 500 Index gained 0.2% to close at a price of 3380, the highest on record.
The Dow Jones Industrial Average fell 29 points to close at 29,398.
The Nasdaq 100 closed 0.3% higher at 9623.
The Stoxx Europe 600 Index was little changed at 430.
Currencies
Here is a summary of the main Changes in F.X. Markets:
The Bloomberg Dollar Spot Index was little changed at 1207.
The British Pound advanced 0.7% to $1.3050, hitting its strongest level in two weeks on its fifth consecutive advance.
The Euro decreased was little changed at $1.0840, the weakest in almost three years.
The Japanese Yen was little changed at 109.79 per dollar.
Bonds
The yield on 10-year Treasuries declined two basis points to 1.59%.
Britain’s 10-year yield fell two basis points to 0.63%.
Germany’s 10-year yield declined two basis points to -0.41%.
Commodities
West Texas Intermediate crude closed 1.3% higher at $52.06 a barrel.
Gold advanced 0.4% to $1,583.74 an ounce.
Copper rose 0.5%.
With the U.S Markets closed for the President’s Day Holiday the only data of note to be released on either side of the Atlantic is Euro-Zone Construction Output at 10.00 am.
March S&P 500
With volume at near year-to-date lows, Friday was a quiet trading session. Late in the day the S&P traded lower to my 3365 buy level before rallying to my 3372 T/P level and I am now flat. Overnight Chinese Markets closed higher and this has led to a further rise in the S&P which is trading at 3388 as I go to press. The S&P Futures Market will stay open until 4.30 pm before re-opening again at the normal 11.00 pm time tonight. I am still looking for a reversal at or near current prices and my sell level today will be from 3397/3412 with a higher 3423 stop. The S&P has initial support from 3360/3372 and I will be a small buyer on any dip to this area with a 3359 stop.
EUR/USD
No Change as I am still long at 1.0860 with the same 1.0795 stop. Even though the Euro is severely oversold I will leave my T/P level unchanged at 1.0875 and if any of the above levels are hit I will be back with a new update for my Platinum Members. The Daily Sentiment Index closed with a reading of just 8% bulls. This is the lowest level of optimism in 15 months (November 13, 2018 at 5%). That low lasted four months. The Euro has initial resistance from 1.0945/1.0985 where I will be a small seller with a 1.1025 stop.
March Dollar Index
No Change as I am still a seller from 99.25/99.65 with the same 100.05 stop.
March DAX
I am still flat the DAX as the market again traded in a narrow range on Friday. Today I will continue to be a seller on any rally higher to 13845/13905 with a higher 13955 stop. Despite the DAX near all-time highs I still do not want to be long the market at this time. It is incredible that as the ECB keeps pumping money into the system that we just registered the lowest Quarter growth in seven years for the Euro-Zone with a rise of +0.1%. It is clear that ECB polices are not working yet the stock markets continue to ignore reality as shown by the Stoxx 600 which is also trading at record highs.
March FTSE
The FTSE fell shy of my 7320 initial buy level before having a small rally into the New York close. Today I will Raise my buy level to 7305/7345 with a higher 7270 stop.
Dow Rolling Contract
Friday was the slowest day of the year so far with just 6.6 billion shares traded. Even though U.S Indices or at or near all-time highs, internally the market continues to struggle as shown by the McClellan Oscillator which closed barely in positive territory with a +16 print. I am still flat the Dow as I continue to be a seller from 29630/29790 with the same 29885 stop. Given how stretched the Dow is at this time my only interest in buying the market is still on a dip lower to 29040/29190 with a 28930 stop.
March NASDAQ
I am still flat the NASDAQ and today I will raise my sell level to 9720/9780 with a higher 9825 stop. Meanwhile I will leave my 9460/9520 buy level unchanged with the same 9410 stop.
March BUND
I am still flat the Bund and today I will lower my sell level to 174.60/175.00 with a lower 175.35 stop.
Gold Rolling Contract
Despite the U.S. Dollar and Equity Market trading higher we are seeing a modest rise in Gold. I am still flat and I will now raise my buy level to 1551/1561 with a higher 1543 stop.
Silver Rolling Contract
Silver continues to underperform Gold’s rise and I am still flat. I will now raise my buy level to 17.10/17.50 with a higher 16.75 stop.
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