U.S. Equity Markets finished yesterday’s session lower as the seven week sell-off continues, Despite the weak close, the VIX also closed lower by 5.2% at a price of 29.35. The U.S. Department of Labour reported that another 218,000 individuals filed Initial Jobless Claims in the week ending May 14 – a figure that was above last week’s downwardly revised number and Wall street’s estimated 200,000. The U.S. Federal Reserve noted that it wants to cut down on housing and labour demand to better control inflation. Earlier this week, Chairman Jerome Powell said the central bank cannot control the effects of China’s lockdowns and the Russia-Ukraine War. However, it can raise interest rates to cool housing and labour markets. As a result, Wall Street money managers will likely monitor jobless claims and the housing market moving forward – as many analysts are concerned that lower home prices and increased unemployment will drive lower spending and a potential recession. Within the S&P 500, eight of the 11 sectors finished lower. European Markets closed lower. European Central Bank (“ECB”) Governing Council Member Olli Rehn said it needs to quickly raise interest rates to prevent long-term inflation expectations from worsening. ECB Supervisory Board Chair Andrea Enria said banks should reset their adverse scenario expectations for greater headwinds related to the conflict in Ukraine. The European Union unveiled a $220 billion plan to end the region’s reliance on Russian energy supplies by the end of 2027. In Asia, Australian Bureau of Statistics Employment data for April showed the pace of gains is decelerating, indicating that economic output could soon slow. Japanese export expansion for April was weaker than anticipated, slowing versus March due to easing demand in the U.S., Europe, and China. China’s Office of Foreign Affairs Commission Director Yang Jiechi told U.S. National Security Adviser Jake Sullivan that America is headed down the “wrong road” in supporting Taiwan. Global growth concerns festered as central bank officials worldwide continued to push for tightening policy and signs of U.S. consumer spending habits are changing. Elsewhere, Oil rose 1.56% on news that the U.S. is considering sanctioning countries that buy Russian oil, while Gold closed 1.41% higher as the U.S. Dollar declined.
To mark my 2550th 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 335 points yesterday and is now ahead by 1729 points for May having made 762 points in April, following a gain of 5883 points in March. The Platinum Service made an impressive 5324 points in February, after ending January with a gain of 3878 points, more than making up for December’s 932 points loss, 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, after ending March with an impressive gain of 3769 points. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
Equities
The S&P 500 closed 0.58% lower at a price of 3900.
The Dow Jones Industrial Average closed 236 points lower for a 0.76% loss at a price of 31,253.
The NASDAQ 100 closed 0.44% lower at a price of 11,875.
The Stoxx Europe 600 Index closed 2.1% lower.
Yesterday, the MSCI Asia Pacific Index fell 1.8%.
Yesterday, the Nikkei closed 1.89% lower at a price of 26,402.
Currencies
The Bloomberg Dollar Spot Index closed 0.8% lower.
The Euro closed 1.1% higher at $1.0583.
The British Pound closed 1.1% higher at 1.2468.
The Japanese Yen rose 0.3%, closing at $127.82.
Bonds
Germany’s 10-year yield closed five basis points lower at 0.97%.
Britain’s 10-year yield closed two basis points lower at 1.84%.
US 10 Year Treasury closed four basis points lower at 2.84%.
Commodities
West Texas Intermediate crude closed 1.56% higher at $111.35 a barrel.
Gold closed 1.41% higher at $1841.10 an ounce.
This morning on the Economic Front we have U.K Retail Sales at 7.00 am. The only other data of note on either side of the Atlantic is Euro-Zone Consumer Confidence at 3.00 pm.
Cash S&P 500
The S&P tested last week’s 3858 low print but we closed weak as the rebound was not strong enough to convince that we will not see lower prices. Month end is approaching and we have seen some sort of rally attempt in most months. Eight days left starting tomorrow for bulls to make something, anything, happen. Bottomline: This market remains an exercise in drudgery, the ingredients for a sizable rally continue to come together, what is lacking is a trigger or follow through. This week seems guaranteed to close red for the 7th week in a row for only the third time in history. The previous two times in March 1980 and March 2001 was the low for the year followed by a massive rally. The only time the S&P closed lower for eight consecutive weeks was in March 2001 and this low was also met by a sizeable rally. So, it remains a case of patience with awareness of risk levels to get engaged in. Yesterday my S&P plan worked well with the market trading the whole of my buy range for a 3875 average long position before rallying to a high at 3946, enabling me to cover this position at my 3896 revised T/P level and I am now flat. The late 45 Handle sell-off into the close was not what the Bulls were looking for. Junk Bonds rallied for a change yesterday while both the Dollar and Bond yields fell enhancing my view that we are finally close to a meaningful bottom. The S&P has support at last Thursday’s 3858 low print which has got to hold. Today, I will be a buyer from 3850/3880 with no stop for now. If I am taken long I will have a T/P level at 3912.
EUR/USD
The Euro had a nice rally today, hitting an afternoon high at 1.0605. This move higher enabled me to cover my 1.0490 latest long position at my 1.0540 T/P level and I am now flat. I am getting more and more encouraged that we may have seen a meaningful low in the Euro and top in the Dollar, especially with the Euro closing above 1.0560. Today, I will be a buyer from 1.0480/1.0540 with a wider 1.0395 stop
March Dollar Index
My 103.90 short Dollar position worked well with the market trading lower to my 103.40 T/P level. As I go to press the Dollar is trading lower at a price of 102.90. We have resistance from 103.50/104.20 where I will again be a seller with a 105.95 stop.
Cash DAX
My DAX plan worked well with the market trading lower to my 13690 buy level before rallying to my 13780 T/P level and I am now flat. Today, I will again be a buyer on any dip lower to 13580/13680 with the same 13495 stop.
Cash FTSE
My latest 7440 long position did not work out as I was stopped out of this position at 7345 and I am now flat. Ahead of the weekend, my only interest in buying the FTSE is on a further dip lower to 7180/7260 with no stop and a T/P level at 7330. If any of the above levels are hit I will be back with a new update for my Platinum Members.
Dow Rolling Contract
The Dow traded lower to my 31180 buy level before having a late rally to a high at 31565, just missing my 31630 T/P level. I am still long and I will now lower my T/P level to 31480 as I was too aggressive with yesterday’s T/P level. I will add to this trade at 30900 with no stop for now. Sentiment is still on the floor as shown by the Fear & Greed Index which rallied small yesterday, to close at 12 which is still a reading of ‘’Extreme Fear’’ If any of the above levels are hit I will be back with a new update for my Platinum Members.
Cash NASDAQ 100
No Change. I continue to nurse last month’s 14327 long position which I have now carried into May. I will now lower my exit level on this position to 13800 which I am hopeful we will see this month. Despite how oversold the NDX is trading I will not add to my existing long position. If this changes I will be back with a new update for my Platinum Members.
June BUND
The Bund rallied to my too tight 153.10 T/P level on Tuesday’s 152.80 long position and I am now flat. Today, I will again be a buyer on any dip lower to 152.80/152.00 with a 151.25 stop.
Gold Rolling Contract
Gold soared yesterday on the weaker Dollar and I am still flat. I will now raise my buy level to 1822/1808 with a tight 1797 ‘’Closing Stop’’.
Silver Rolling Contract
No Change. Silver has support from 20.70/21.30 where I will continue to be a buyer with the same 19.95 stop.
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