Despite the Dow closing higher for the ninth consecutive trading session after better earnings from IBM, the NASDAQ 100 finally had a down day, closing lower by 2.29%. A combination of weaker earnings from Netflix and Tesla coupled with 10-year yields rising 10 basis points was enough to see a 400 point fall in the NDX. International Business Machines (IBM) maintained its full-year sales growth forecast of 3% to 5%, easing concerns over weakening demand for internet technology. IBM reported sales of $15.5 billion, which was relatively unchanged from the previous year and slightly below analysts’ estimates. However, earnings came in higher than expected at $2.18 per share. IBM’s Chief Financial Officer, James Kavanaugh, expressed confidence in the revenue outlook, citing accelerating momentum in the second half of the year. The U.S. Federal Reserve is on the verge of launching “FedNow,” a long-anticipated service aimed at modernising the country’s payment system. This service will enable ordinary Americans to send and receive funds in seconds, 24/7, eliminating the delays commonly associated with cash transfers. The move will bring the U.S. in line with other countries like the U.K., India, Brazil, and the European Union, which have had similar services for years. “FedNow” has been in development since 2019 and is expected to significantly improve the efficiency and accessibility of the payment system in the U.S. Senators Kirsten Gillibrand (D., N.Y.) and Josh Hawley (R., Mo.) are introducing bipartisan legislation to prohibit members of the federal executive branch and lawmakers from owning individual company stocks. The ‘’Bill’’ would still allow them to invest in mutual funds and broad industry and index funds but aims to eliminate potential conflicts of interest by restricting ownership of individual company stocks, even in blind trusts. This move comes as new polling indicates widespread public support for such a measure. New U.S. home construction slowed down in June, following a strong surge the previous month. New residential starts declined 8% to a 1.43 million annualised rate, but despite the decline, the pace of residential starts indicates that builders are still working to address the shortage of available homes in the resale market. European Markets closed higher. Bank of England Deputy Governor Dave Ramsden has indicated that there is room to increase the pace of reducing the central bank’s balance sheet, known as quantitative tightening. Ramsden also expressed concerns that inflation in the U.K. remains excessively high, despite a larger-than-expected drop in June. However, he refrained from commenting on how the recent inflation data may impact the Monetary Policy Committee’s upcoming decision on interest rates in August. In Asia, the Yuan experienced a significant jump after China implemented measures to support its managed currency. The People’s Bank of China set a daily reference rate for the Yuan at just under 7.15 per Dollar, which was much stronger than expected and the largest bias since November. Additionally, China adjusted some rules to allow companies to borrow more from overseas, signalling a move to attract more foreign capital inflows. These steps were taken as economic growth in the country shows signs of slowing, and Beijing aims to boost business confidence through these measures. Elsewhere, Oil closed 0.37% higher while a 1% rally in the Dollar saw Gold close lower by 0.6%.
To mark my 2800th 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 235 points yesterday and is now down by 216 points for July, after closing June with a gain of 2683 points. May closed with a gain of 3205 points. April saw a gain of 3354 points while March closed with a gain of 6168 points. The Platinum Service made 3164 points in February, 4687 points in January 2054 points in December, 4789 points in November and a record 9619 points last October. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1900 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 0.88% lower at a price of 4534.
The Dow Jones Industrial Average closed 163 points higher for a 0.47% gain at a price of 35,225.
The NASDAQ 100 closed 2.29% lower at a price of 15,466.
The Stoxx Europe 600 Index closed 0.45% higher.
This morning, the MSCI Asia Pacific closed 0.3% lower.
This morning, the Nikkei closed 0.56% lower at a price of 32,307.
Currencies
The Bloomberg Dollar Spot Index closed 0.9% higher.
The Euro closed 0.8% lower at $1.1121.
The British Pound closed 0.4% lower at 1.2880.
The Japanese Yen fell 0.4% closing at $140.20.
Bonds
Germany’s 10-year yield closed 7 basis points higher at 2.40%.
Britain’s 10-year yield closed 8 basis points higher at 4.19%.
U.S.10 Year Treasury closed 9 basis points higher at 3.88%
Commodities
West Texas Intermediate crude closed 0.37% higher at $75.63 a barrel.
Gold closed 0.6% lower at $1966.10 an ounce.
This morning on the Economic Front we already had the release of U.K. Retail Sales which rose 0.7% versus +0.2% expected. The only other data of note on either side of the Atlantic is Canadian Retail Sales and the New Housing Price Index at 1.30 pm.
Cash S&P 500
The S&P finally saw some selling led by the NDX rolling over. I have no idea whether this is the start of a major correction given the six ‘’Open Gaps’’ below in the S&P but the 4580-resistance level has certainly proved its worth so far. However, as we know the VIX tends to get crushed on a Friday and if this pattern continues today then yesterday may have been only a one-day wonder. I am still short at 4505. I have this position for too-long a period. I will now raise my exit level to 4520. If this exit point is triggered, I will be back with a new update for my Platinum Members.
EUR/USD
I was beginning to doubt my charting ability after the U.S. stock market kept ignoring the 14-Day RSI readings. However, Monday’s 74 print in the EUR/USD RSI certainly worked with the Euro hitting a low yesterday at 1.1118 – 160 points below Monday’s high. I am still flat. I will now lower my sell level to 1.1180/1.1260 with a lower 1.1315 ‘’Closing Stop’’. The Euro has short term support from 1.1000/1.1060 where I will be a strong buyer with a 1.0935 ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 1.1130. If I am taken long, I will have a T/P level at 1.1130.
June Dollar Index
The Dollar had a strong rally yesterday, and I am still flat as Thursday’s buy range was never threatened. I will now raise my buy level to 99.50100.20 with a tight 98.95 ‘’Closing Stop’’. If I am taken long I will have a T/P level at 100.65.
Cash DAX
My DAX plan worked well as the market traded higher to my 16190-sell level late yesterday before selling off to my revised 16110 T/P level this morning as emailed to my Platinum Members and I am now flat. The DAX has resistance from 16180/16260 where I will again be a seller with the same 16315 ‘’Closing Stop’’. I still do not want to be long the DAX at this time. If I am taken short I will have a T/P level at 16110.
Cash FTSE
The FTSE surged again yesterday, and I am still flat. Thankfully, we had no sell level in the FTSE over the past 10 days. The FTSE has resistance from 7790/7860 where I will be a seller with a 7915 tight ‘’Closing Stop’’. I will now raise my buy level to 7500/7570 with a 7435 higher ‘’Closing Stop’’.
Dow Rolling Contract
Wrong! Yesterday’s aggressive move higher saw my 34885 stopped on the close at 35225. The Dow has closed higher for nine consecutive trading sessions. I am sure we have closed higher for 10 days in a row, but I cannot remember the last time this happened. The Dow has now risen over 1800 points in a straight line, resulting in the 14-Day RSI closing last night at 72. The Fear & Greed Index closed at 80 which is still ‘’Extreme Greed’’. Despite the aggressive selloff in tech stocks yesterday this reading is only two points lower than Wednesday’s 82 print. After the close I sold the Dow again at a price of 35236. I am still short, and I will add to this trade at 35500 with a fixed 35705 stop. I will have a T/P level on this position at 35050. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash NASDAQ 100
The NDX had its worst day since March, closing lower by 2.29% as money flowed out of tech stocks and into the Dow. The negative divergence for the NDX on the back of recent gains in the main Tech stocks finally proved right as anyone chasing Netflix and Tesla over the past couple of days are sitting on large losses now. The selloff is mild in the overall scheme of things given the ramp higher since the March lows. Finally, the insane RSI readings are being reflected in lower prices with the NDX falling 500 points from Wednesday’s afternoon high print. The NDX is now oversold on the 15 min chart but extremely overbought on the Daily chart. We do not know if this is the start of something larger as regards a downside move as yet but yesterday’s sell-off in both the NDX and S&P came at key resistance levels. I will point out that the weekly candle on the NDX is encouraging for sellers. There was a similar candle in early 2022 that marked the end of that rally followed by an aggressive sell-off. The current weekly RSI has a lot of room for a sizeable move lower. I have no interest in being long this market. I know selling is difficult, but my signals are still screaming ‘’Sell’’. I am now flat the NDX after exiting my 15695 average short position at 15670. Today, I will again be a seller on any further rally to 15570/15720 with a wider 15905 ‘’Fixed Stop’’. If I am taken short, I will have a T/P level at 15410.
September BUND
The Bund continued to build on Wednesday’s downside Key Day Reversal. The Bund has support from 131.40/.132.20 where I will be a small buyer with a 130.85 ‘’Closing Stop’’. Meanwhile, my only interest in selling the Bund is still on a rally higher to 134.30/135.10 with the same 136.05 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 132.75. If I am taken short, I will have a T/P level at 133.75.
Gold Rolling Contract
No Change. The stronger Dollar led to a small sell-off in Gold yesterday. I am still flat. Today, I will continue to be a buyer on any dip lower to 1933/1948 with the same 1921 ‘’Closing Stop’’. If I am taken long I will have a T/P level at 1959.
Silver Rolling Contract
I am still flat as Silver continues to build value above 24.50. I will leave my 23.80/24.50 buy level unchanged with the same no stop. If I am taken long, I will have a T/P level at 25.20.
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