The FX markets which have been very calm over the past week changed yesterday leading to a fair amount of volatility. The Australian Dollar sits at the bottom of the G10 Leader board, extending its losses that started just after I posted yesterday morning with the AUD/USD currently trading below the key 0.7300 support at 0.7280 from the fall in the little – noticed Inflation Expectations reading. The NOK sits at the top, in conjunction with WTI crude oil prices hitting a six – month high as we briefly traded over $47 after the IEA said global oil stocks would experience a drastic reduction in the second half of the year on the back of strong demand and falling supply by some major producers. The CAD also benefited from the higher oil, while other commodity prices – base metals in particular – are slightly softer.
To mark my 1075th issue of Tradernoble Daily Commentary I am offering a special 2 year rate of Euro 2500 for my Platinum Service which includes 1/4 updated emails throughout the trading session. This offer is open to both new and existing members and if anyone is interested please email me on bryan@tradernoble.com for details.
For anyone following my Platinum Service it made 137 points yesterday and is now ahead by 609 points for May having made 2175 points in April. The previous two months saw the same gain of 2265 points in each month following a record 3365 point gain in January. Since I started this service last service last June it has made over 24,500 points.
Sterling closed higher following the 9-0 vote for unchanged Bank of England Monetary Policy. There had been some speculation of dissent in favour of pre-emptive easing ahead of the June 23 EU Referendum. On this, the Bank’s forecast assume that the Government declared policy of ‘Remain’ comes to pass and while it’s medium term growth track is lower than in February, Governor Carney described the outlook as ‘far from gloomy’. Under a ‘Leave’ scenario, the Bank notes potentially severe downside risk for Sterling – and with that higher inflation. In the Emerging Markets World, the Brazilian Real has not shown much reaction to the news that the Senate voted 55-22 in favour of impeachment proceedings against President Rouseff – a widely expected move.
US stocks recouped their mid-session, technology-led weakness to close flat on the day. However this morning the Futures market sees the Dow trading 120 points lower on weaker European Equity markets and a stronger Yen which saw the Nikkei close over 1% lower after a nice run higher over the previous few trading sessions. Apple shares fell nearly 3% yesterday and are now down 20% from their highs a few weeks ago as the fall-out from Carl Icahn selling his entire 1% holding in the share last month continues.
The US markets were not helped by the largest rise in 12 years for the Weekly Jobless Claims which rose to 294K versus the 270K expected. Earlier Euro-Zone Industrial Production fell by 0.8% against expectations for an unchanged reading.
This morning on the economic front we have Euro-Zone GDP at 9.00 am. This is followed at 1.30 pm by US Retail Sales and PPI. Finally at 3.00 pm we have Business Inventories and the University of Michigan Consumer Sentiment.
Just before the close at 8.00 pm the San Francisco Fed President Williams will speak on the economy in Sacramento.
June S&P 500
My long 2061.50 S&P position worked well with the market trading to a 2072.75 high print after I posted which enabled me to cover my position at my 2066 T/P level and I am still flat. Unfortunately the S&P just missed my 2073 sell level before having a nice 25 handle fall. This morning equity markets are opening on the defensive as we approach the key 2030/2035 support zone from where we had the 50 handle bounce following last Friday’s NFP data. A break and close below 2030 will be bearish and could see an acceleration lower to the 200 Day Moving Average at 2010. If the market trades lower to this 2010 area over the coming days I will be a very aggressive buyer with a 2003 stop. For today I will be a small buyer on any further dip lower to 2033/2038 with a tight 2028 stop. I still do not want to be short the market unless we trade higher to 2064/2069 with a 2074 stop which is just above yesterday’s high print.
EUR/USD
Overnight the Euro traded lower to my 1.1350 buy level. I am still long and I will leave my stop unchanged at 1.1295. If I am stopped out of this position I will be a more aggressive buyer from 1.1230/1.1260 with a 1.1195 stop.
June Dollar Index
I am still flat the Dollar and as I am already short the Euro I will now raise my sell level in the Dollar to 94.80/95.20 with a 95.50 stop. I do not want to be long the Dollar at this time.
June DAX
Shortly after the DAX opened this morning the market traded lower to my 9790 buy level. Subsequently I emailed my Platinum Members to exit this position at 9815 as I do not like the price action in equity markets at this time and I am now flat. My only interest in buying the DAX today is on a further dip lower to 9650/9710 with a 9595 stop. I will also look to sell the DAX on any rally higher to 9910/9960 with a 10020 stop.
June FTSE
The FTSE had a very volatile trading session yesterday with the market trading higher to 6160 before having a quick 100 point sell-off after the Bank of England left rates unchanged amid a slowing economy. This sell-off saw the FTSE trade lower to my 6065 buy level and as we were having a nice trading day I emailed my Platinum Members to exit this position at 6082 and I am still flat. After a brief rally the FTSE is selling off again this morning as we approach the bottom of the Daily Bollinger Band and Williams Index. Today I will again look to buy the market on any further dip lower to 5990/6020 with a 5955 stop. Given how oversold the FTSE is trading I do not want to be short the market at this time.
Dow Rolling Contract
No change as I am still a buyer on any dip lower to 17480/17550 with a 17430 tight stop. The Dow is approaching decent support at last week’s low print and for this reason I do not want to be short the market at this time.
June BUND
I am still flat the Bund and today I will now lower my sell level to 164.45/164.75 with a 165.10 stop.
Gold Rolling Contract
Gold hit my buy level with a 1262 low print before again having a strong rally to 1275. If you did manage to buy Gold I would look to take your profit here and go flat. Unfortunately as I was already long Silver I did not buy Gold and I am still flat. Today I will now look to buy Gold on any further dip lower to 1253/1260 with a 1246 stop.
Silver Rolling Contract
Silver traded lower to my 17.05 buy level with a 16.85 low print. I am still long and today I will raise my stop on this position to 16.60.
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