U.S. Equity Markets got hit hard yesterday led by the NASDAQ 100 falling over 400 points for a 2.57% loss. This move lower saw the VIX soar over 15% on what turned out to be a brutal session for Technology Stocks. Producer Price Index (“PPI”) data for December jumped 9.7% from the same month a year ago, but still came in below estimates. On the Fed side, both St. Louis Fed President James Bullard and Philadelphia Fed President Patrick Harker said that they could be in favour of four interest-rate hikes in 2022. That is more than the market was expecting, and more than it would like to hear. The concern of higher rates took the wind out of the tech sector, as tech stocks sold off for the first time in a few days. In other economic data, Jobless Claims came in at 230,000, remaining above the post-pandemic low from earlier this year and late last year. While the longer-term trend remains lower, Claims hit the highest level in about two months. This afternoon brings more important economic data, with releases of Retail Sales and Consumer Sentiment. Within the S&P 500 Index, eight of the 11 sectors finished lower. European Markets closed mixed. Italian Industrial Production figures for November were stronger than expected as machinery and pharmaceutical manufacturing rose. France’s government introduced new COVID-19 restrictions, including proof of immunity to access public spaces and to travel. The Bank of England told British lenders and insurers that they must properly quantify climate risks in their assessment and lending practices or the central bank will take action. In Asia, Japan’s Chief Cabinet Secretary Hirokazu Matsuno said the government would consider any request to expand COVID-19 restrictions as Tokyo was said to consider raising its alert level. China detected an individual in the port city of Dalian infected with the COVID-19 Omicron variant, signalling the potential for more virus curbs. Saudi Arabia’s sovereign wealth fund was said to plan on investing $10 billion in stocks this year, focusing on e-commerce and renewables companies. The People’s Bank of China’s new Yuan loan data for December was weaker than expected, implying a slowdown in spending and economic growth. Elsewhere, Oil fell 1.36% with risk assets, while Bitcoin fell over 3% alongside tech shares.
To mark my 2475th 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 76 points yesterday and is now ahead by 750 points for January, after ending December with a loss of 932 points, having made 2466 points in November, 1028 points in October, 2866 points in September, 1543 points in August, and 996 points in July. The Platinum Service made 1366 points in June, 1439 points in May, 1244 points in April, having ended March with an impressive gain of 3769 points, 3286 points in February, 2077 points in January, and 2273 points last December. 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 1.42% lower at a price of 4659.
The Dow Jones Industrial Average closed 176 points lower for a 0.49% loss at a price of 36,113.
The NASDAQ 100 closed 2.57% lower at a price of 15,495.
The Stoxx Europe 600 Index closed 0.4% lower.
Yesterday, the MSCI Asia Pacific Index rose 0.8%.
Yesterday, the Nikkei closed 0.96% lower at a price of 28,489.
Currencies
The Bloomberg Dollar Spot Index closed 0.1% higher.
The Euro closed 0.1% higher at $1.1458.
The British Pound closed 0.1% lower at 1.3701.
The Japanese Yen rose 0.3%, closing at $114.16.
Bonds
Germany’s 10-year yield closed three basis points lower at -0.09%.
Britain’s 10-year yield closed three basis points lower at 1.11%.
US 10 Year Treasury closed four basis points lower at 1.70%.
Commodities
West Texas Intermediate crude closed 1.36% lower at $81.45 a barrel.
Gold closed 0.35% lower at $1,822.10 an ounce.
This morning on the Economic Front we have U.K. Trade Balance, GDP and Industrial/Manufacturing Production at 9.30 am. This is followed by U.S. Retail Sales and the Import/Export Price Index at 1.30 pm. At 2.15 pm we have Industrial Production and Capacity Utilisation. Finally, we have University of Michigan Consumer Sentiment Index and Business Inventories at 3.00 pm. Meanwhile ECB President Lagarde and the Fed’s Williams are speaking at 1.15 pm and 4.00 pm respectively.
Cash S&P 500
Yesterday’s post PPI high at 4744 tested Wednesday’s 4748 post CPI high before the market got slammed 95 Handles. As a result, I can now make a case for Double Top which is technically very bearish. It was noticeable that the NDX led the decline despite Bond Yields falling. The 400 point fall in the NDX leaves the market not far off Monday’s 15200 low print. I did not like the price action yesterday afternoon, resulting in me sending four different updates to my Platinum Members. I lowered my buy level in the S&P to 4676 before emailing them again to exit any long position at 4678 and I am now flat. Thankfully, the S&P held in for a few minutes after my update before falling 30 Handles into the close. The S&P has now joined the NDX in settling below its 50-Day Moving Average (4680) and this level should act as strong resistance on any further test. The S&P is no longer oversold and has plenty of room to fall lower. I would love to see the S&P test the 4350/4400 major support over the coming weeks as this would set up a nice potential rebound. Today, the S&P has short-term support from 4623/4638 where I will be a small buyer with a 4609 stop. The S&P has resistance from 4678/4693 where I will be a small seller with a lower 4709 stop.
EUR/USD
After Wednesday’s aggressive move higher the Euro has traded in a narrow range over the past 24 hours. I will continue to be a buyer on any dip lower to 1.1370/1.1420 with the same 1.1325 tight stop. If I am taken long I will have a T/P level at 1.1455. I still do not want to be short the Euro at this time.
March Dollar Index
No Change. I am still long at a price of 95.00 and I will still add to this trade at 94.40 while leaving my 93.95 stop unchanged. I will also lower my T/P level to 95.25. If any of the above levels are hit I will be back with a new update for my Platinum Members.
Cash DAX
Late in the session the DAX traded lower to my initial 15890 buy level before rallying to my 15908 revised T/P level as emailed to my Platinum Members and I am now flat. Today, my buy level will be from 15700/15780 with a 15635 stop. Ahead of Lagarde’s speech this afternoon I do not want to be short.
Cash FTSE
The FTSE just missed my sell range and I am still flat. I will now lower my sell level to 7560/7610 with a lower 7665 stop.
Dow Rolling Contract
The Dow fell over 450 points from its post 15510 PPI print and I am still flat. Ahead of today’s Retail Sales data I will now lower my buy level to 35870/35700 with a lower 35495 stop. If I am taken long I will have a T/P level at 36020.
Cash NASDAQ 100
Yesterday, saw plenty of two- way price action in the NDX with the market trading in a wide 520- point range. Yesterday’s price action was extremely bearish for the NASDAQ with over 65% of its components closing below their respective 200 Day Moving Averages. After the NDX hit my 15630 buy level I covered this position at my revised 15668 T/P level and I am now flat. The NDX has strong support from 15100/15300 and I will be a buyer on any test of this area with a wider 14995 stop. Ahead of the weekend I do not want to be short the market.
March BUND
Frustratingly, the Bund just missed my 169.60 buy level (low of 169.84) before rallying over 100 points into the close. The break and close over 170.50 is short-term bullish. I will now raise my buy level tom 170.10/170.55 with a 169.65 tight stop.
Gold Rolling Contract
Gold continues to struggle to break the 1830/1840 resistance level. With everyone still long Gold I am nervous and today, I will lower my buy level to 1780/1795 with a 1769 stop
Silver Rolling Contract
No Change. I am still a buyer on any move lower to 21.95/22.65 with the same 21.25 stop. If I am taken long I will have a T/P level at 23.05.
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