U.S. Equity Markets bounced around in a volatile fashion as investors continued to digest Wednesday’s Federal Reserve’s policy announcement, ending yesterday’s session mixed, with the NASDAQ 100 closing with a gain of 1.29%, while the Dow close lower for a 10th consecutive trading session with a loss of 0.64%. The Federal Reserve announcement was still in focus. The Fed boosted its inflation outlook for the year, but kept its long-term inflation expectation intact. And Federal Reserve Chairman Jerome Powell said it will continue with “powerful” monetary support as the economy is still a long way from achieving the central bank’s goals. Labour market data were the big data point of the day. Jobless Claims unexpectedly rose, snapping a six-week downtrend. However, the four-week moving average declined, indicating that the longer-term trend of fewer Jobless Claims is still intact. This is a good sign for the labour market’s recovery. On infrastructure, more Republican Senators came out in support of the bipartisan proposal, but the path ahead is still uncertain. European Markets made further gains. Italy’s Trade Surplus for April rose versus March, as exports to the rest of Europe and the world continued to surge, almost doubling from their levels a year ago. The European Central Bank’s Governing Council was said to be preparing to extend capital requirement relief for banks until March next year to ensure an ample flow of credit. ECB Executive Board member Philip Lane said it was too soon to talk about dialling back the central bank’s Pandemic Emergency Purchase Programme. In Asia, China’s Asset Supervision and Administration Commission ordered state-owned enterprises to limit their overseas commodities market exposure, in an attempt to rein in prices. Japanese Prime Minister Yoshihide Suga said the government would end the coronavirus state of emergency covering nine prefectures, including Tokyo, on July 11. Australia’s employment figures for May were much stronger than expected, as the number of full- and part-time workers saw significant gains, pointing to economic growth. Elsewhere, Oil closed 1.47% lower, while Gold fell a further 4.61% on Dollar strength.
To mark my 2325th 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 90 points yesterday and is now ahead by 1334 points for June having made 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, 2273 points in December, 2025 points in November, 2779 points in October, 3042 points in September and 2383 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
The S&P 500 closed 0.04% lower at a price of 4221.
The Dow Jones Industrial Average closed 210 points lower for a 0.62% loss at a price of 33,823.
The NASDAQ 100 closed 1.29% higher at a price of 14,163.
The Stoxx Europe 600 Index closed 0.2% higher.
Yesterday, the MSCI Asia Pacific Index fell 0.4%.
Yesterday, the Nikkei closed 0.93% lower at a price of 29,018.
Currencies
The Bloomberg Dollar Spot Index closed 0.7% higher.
The Euro closed 0.9% lower at $1.1905.
The British Pound closed 0.6% lower at 1.3918.
The Japanese Yen rose 0.4%, closing at $110.24.
Bonds
Germany’s 10-year yield closed five basis points higher at -0.20%.
Britain’s 10-year yield closed two basis points higher at 0.77%.
US 10 Year Treasury closed seven basis points lower at 1.51%.
Commodities
West Texas Intermediate crude closed 1.47% lower at $7090 a barrel.
Gold closed 4.61% lower at $1,771.10 an ounce.
This morning on the Economic Front we have UK Retail Sales at 7.00 am and this is followed by the Euro-Zone Current Account at 9.00 am. Finally, the June Contracts for the Dow, S&P and NASDAQ all expire at 2.35 pm.
September S&P 500
I have now rolled to the September Contract which trades at a Discount of 10 Handles to the June Contract. Although the S&P closed flat we saw plenty of two-way volatility as the June Contract just missed my 4190 buy level before rallying 30 Handles into the close. The divergence between the Dow and both the NASDAQ and S&P is growing and this is not a sign of a healthy market. Contract Expiration trading sessions can be extremely volatile. The S&P is severely overbought and due a correction. However, we must see the September Contract break the key support from 4168/4183. I will be a buyer on any dip to this area with a 4157 ‘’Closing Stop’’. The September Contract has resistance from 4232/4247 where I will be a seller with a 4261 ‘’Closing Stop’’.
EUR/USD
The Euro sold off again yesterday, falling 1% for the second consecutive trading session which is unusual given how narrow a range this market had traded for the past few months. This move lower saw my 1.1915 buy level executed. I am still long and I will add to this trade at 1.1860 with a now lower 1.1815 stop. I will now lower my T/P level to 1.1945 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
September Dollar Index
Thankfully, we have had no sell level in the Dollar over the past week with the market now trading 250 points higher in that time. The Dollar is now overbought, has resistance from 92.30/92.80 where I will be a small seller with a 93.15 stop. If I am taken short I will have a T/P level at 91.95.
September DAX
The DAX continues to ignore the negative price action in the Dow as the market again traded in a narrow range and I am still flat. The DAX has support from 15310/15380 where I will be a small buyer with a 15245 stop.
September FTSE
No Change. I am still an aggressive buyer from 6900/6950 with a lower 6865 tight stop.
Dow Rolling Contract
The Dow made an afternoon high at 34080 before falling almost 500 points. This move lower saw the whole of my buy filled for a 33725 average long position. Unfortunately, I covered this long position too early at 33770 and I am still flat. With the Dow closing lower for 10 straight days we are long overdue a bounce. I certainly would not chase the Dow lower from here. We have support from 33450/33620 where I will again be a buyer with a 33325 ‘’Closing Stop’’. If I am taken long I will have a T/P level at 33755.
September NASDAQ
Incredible rally in the NASDAQ yesterday as the market closed at a new all-time high at 14170.The NASDAQ has now rallied over 1200 points since its Double Bottom low on May 22. The NASDAQ is severely overbought and once today’s June Contract expires, should lead to some profit-taking. We have resistance from 14250/14350 where I will be a seller with a 14435 ‘’Closing Stop’’. The NASDAQ has support at yesterday’s 13840 low. I will be a small buyer from 13770/13870 with a 13695 ‘’Closing Stop’’. If I am taken short I will have a T/P level at 14160. If I am taken long I will have a T/P level at 13945.
September BUND
Late in the New York session, the Bund rallied to my 172.65 sell level. I am still short and ahead of the weekend I will now raise my T/P level to 172.40 with a now lower 173.15 stop.
Gold Rolling Contract
Gold has fallen almost 8% in the last few days as the 1900/1910 proved to be huge resistance. Yesterday, my Gold plan did not work well as after buying the market at an average rate of 1790, I was stopped out of this trade at 1773 and I am still flat. Gold is now oversold and approaching strong support from 1745/1760 where I will again be a buyer with a 1733 stop. If I am taken long I will have a T/P level at 1772.
Silver Rolling Contract
I was lucky with my latest 26.80 long Silver position as the market rallied to my 27.15 T/P level before following Gold lower, sitting at 25.93 as I post my commentary. Silver has support from 24.70/25.35 where I will again be a buyer with a 24.25 tight stop.
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