Both the S&P and NASDAQ closed at new all-tine highs on hopes the U.S. Economy is rebounding faster than anticipated. Markit’s U.S. PMI data for August was stronger than expected, showing strength versus July’s data. Strength was broad based in both the Services and Manufacturing Indexes. Investors were also optimistic on the potential for a Coronavirus vaccine. Late Thursday, Pfizer (PFE) and BioNTech (BNTX) released an update on late-stage trials. They said the inoculation has been well-tolerated so far. They also said they are on track to have data ready as soon as October for regulatory approval and emergency-use authorisation. The S&P 500 closed 0.34% higher, closing at a new record high of 3397, helped by the 0.68% rise in the NASDAQ 100, led by Apple which rose 5.1%. Meanwhile, European Indices again closed lower, following the release of Markit’s Eurozone PMI data for August coming in much weaker than expected. Germany, the region’s largest economy, saw notable weakness in the Services sector. This raised concerns that the regional recovery may be stalling. That is important because Europe is viewed as having better growth than the U.S. at the moment. The Euro closed 0.5% lower on this news at $1.1790. Elsewhere, Gold closed flat after a volatile session, while Oil fell 1.3% on worries about European growth.
To mark my 2125th 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 285 points on Friday and is now ahead by 2067 points for August having ended July with a gain of 3128 points, 2580 points in June, 2456 points in May, 4773 points in April, an incredible 9264 points in March, 2223 points in February and 2142 points in January. 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
The S&P 500 closed 0.34% higher at a price of 3397.
The Dow Jones Industrial Average rose 190 points for a 0.69% gain to close at 27,930.
The NASDAQ rose 0.68%, closing at a new all-time high at 11,555.
The Stoxx Europe 600 Index fell 0.4%.
The MSCI Asia Pacific Index fell 0.2%.
The Nikkei was closed for a Bank Holiday.
Currencies
The Bloomberg Dollar Spot Index increased 0.4%.
The Euro closed 0.5% lower at $1.1790.
The British Pound closed 1.2% lower at $1.3085.
The Japanese Yen closed 0.1% higher at 105.80 per dollar.
Bonds
The yield on 10-year Treasuries closed one basis point lower at 0.64%.
Germany’s 10-year yield fell one basis point to -0.51%.
Britain’s 10-year yield also closed three basis points lower at 0.20%.
Commodities
The Bloomberg Commodity Index fell 0.3%.
West Texas Intermediate closed 1.31% lower at $41.49 a barrel.
Gold closed flat at $1,938.10 an ounce.
This morning on the Economic Front we have no data of note from either the UK or the Euro-Zone. The only U.S data due is the Chicago Fed National Activity Index at 1.30 pm.
September S&P 500
The S&P closed at a new all-time high on Friday after reversing an earlier decline. The US Indices are being led higher by less than 10 stocks which have driven the NASDAQ’s relentless move higher since the March 23 low. The Market Cap to GDP is now at a new record high of 179% which is not sustainable while internally the market is weak as shown by the McClellan Oscillator which fell on Friday to close at -151. Another key indicator that I watch closely is the ‘’Buffet Indicator’’ which tells you whether stocks are expensive. The historical average for this indicator is around 1. On Friday we closed at 1.72, signalling the market is severely overvalued. To give you an idea of how overvalued this indicator is, back in 2000 when the Dot Com Bubble burst the reading was at 1.7. However as Keynes famously said ‘’Markets can remain irrational longer than you can remain solvent’’ is certainly relevant at this time with over 28 million Americans’ still unemployed. Shortly after I posted on Friday the S&P traded lower to my 3377 T/P level on my 3384 average short position and I am still flat. This morning the S&P is trading higher at 3411 as I go to press. The S&P is now in my 3400/3440 sell range. Today, I will be a seller from 3417/3433 with a 3451 wider stop. I do not want to be long the S&P at this time.
EUR/USD
The Euro got hit hard on Friday following the release of the Euro-Zone PMI data. The Euro traded the whole of my buy range for a 1.1795 average long position. In the last few minutes the Euro has rallied to my 1.1810 T/P level and I am now flat. Today, I will lower my sell level to 1.1860/1.1910 with a lower 1.1955 stop. The Euro has short-term support from 1.1680/1.1730 where I will be a buyer with a 1.1635 stop.
September Dollar Index
Shortly after I posted on Friday the Dollar traded higher to my 92.80 T/P level on my 92.60 latest long position and I am now flat. Today, I will again look to buy the Dollar on any dip lower to 92.30/92.70 with a 91.95 stop.
September DAX
After the DAX traded lower to my 12710 buy level, I exited this position too early at 12725 as I had too many open positions on board. This morning the DAX is trading higher at 12870. I will now raise my sell level to 13040/13140 with a higher 13205 stop. The DAX has short-term support from 12650/12740 where I will be a buyer with a 12585 stop.
September FTSE
The FTSE continues to underperform the other major Indices. I am watching this market closely as the FTSE was the first market to top back in November ahead of the US Markets hitting a brick wall in February. On Friday, my FTSE plan worked well with the market trading lower to my 5955 buy level before rallying to my revised 5985 T/P level and I am still flat. Today, I will again be a buyer on any dip lower to 5920/5960 with the same 5885 stop. Given how oversold the FTSE is trading I still do not want to be short the market at this time.
Dow Rolling Contract
This morning the Dow is now trading over 500 points higher from where I marked prices last Friday morning. Just as I posted the Dow traded higher to my 27605 T/P level on my 27540 latest long position. The Dow rallied hard in the last hour of trading and I emailed my Platinum Members to raise their Dow sell level to 28030/28150. This morning the Dow is trading in this sell range and I have now gone short here at 28070. I will now add to this position at 28270 with a now higher 28425 stop. My T/P level on this short position will be 27910 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
September NASDAQ
Today, the NASDAQ is on course to make its 35th all-time high for 2020. This move higher has me short at an average rate of 11570. I will now raise my T/P level on this position to 11525 with the same 11705 stop.
September BUND
No Change as I m still a small buyer from 176.15/176.55 with a 175.75 stop.
Gold Rolling Contract
My Gold plan worked well with the market trading lower to my 1914 buy level before rallying $25. Unfortunately, I covered this position too early at 1920 and I am still flat. Today. I will again be a buyer from 1899/1912 with a 1887 stop.
Silver Rolling Contract
Silver traded lower to my 26.50 buy level. I am still long and I will add to this position at 25.80. I will leave my stop unchanged at 25.35 while lowering my T/P level on this position to 26.91.
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