U.S Equity Markets fell at the open as the S&P 500 entered a “correction” (10% below highs) in early afternoon trading. Initial Jobless Claims rose and missed expectations, sparking fears that the job market’s recovery was stalling. But markets quickly rebounded off the lows. Treasury Secretary Steven Mnuchin said that he and House Speaker Nancy Pelosi (D-CA) have both agreed to restart stimulus talks, though both sides remain far apart on the total size of any support bill. New home sales surged to a 14-year high, the latest sign that the housing market’s boom is not slowing down. Federal Reserve Bank of St. Louis President James Bullard said the domestic economy could see a full recovery by year’s end if we have “very rapid third-quarter growth.” He added that he feels there has been significant progress made in managing the COVID-19 outbreak. At the end of a volatile trading session the S&P closed with a gain of 0.3%. Meanwhile, in the Europe, Germany’s IFO Business Climate Index improved for the fifth month in a row, indicating businesses continue to see operations return to normal. British Chancellor of the Exchequer Rishi unveiled a new support package to shepherd the U.K. economy through the latest round of Coronavirus restrictions. The European Central Bank allotted $203 billion in low-interest loans to regional banks in order to spur lending to households and businesses. Elsewhere, Oil closed 0.79% higher on follow-through from Wednesday’s larger than expected drawdown in gasoline inventories, while the Dollar wad flat and Gold close 0.2% higher.
To mark my 2150th 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 345 points yesterday and is now ahead by 2297 points for September, having made 2383 points in August, 3128 points in July, 2580 points in June, 2456 points in May, 4773 points in April, an incredible 9264 points in March, 2223 points in February and 2142 points in January. 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 0.3% higher at a price of 3346.
The Dow Jones Industrial Average closed 52 points higher for a 0.2% gain at a price of 26,815.
The NASDAQ 100 closed 0.56% higher at a price of 10,896.
The Stoxx Europe 600 Index closed 0.7% higher.
The MSCI Asia Pacific Index rose 0.5%%.
This morning the Nikkei closed 0.51% higher at 23,204
Currencies
The Bloomberg Dollar Spot Index closed flat.
The Euro closed unchanged at $1.1665.
The British Pound closed 0.3% higher at $1.2745.
The Japanese Yen closed 0.4% lower at 105.25 per dollar.
Bonds
The yield on 10-year Treasuries closed two basis points higher at 0.67%.
Germany’s 10-year yield closed two basis points higher at -0.50%.
Britain’s 10-year yield closed two basis points higher at 0.22%.
Commodities
The Bloomberg Commodity Index rose 0.2%.
West Texas Intermediate closed 0.8% higher at $40.20 a barrel.
Gold closed 0.19% higher at $1865.10 an ounce.
This morning on the Economic Front we have Euro-Zone Money Supply at 9.00 am and this is followed by the Bank of England Quarterly Bulletin at 12.00pm. Next, we have U.S Durable Goods Orders at 1.30 pm. Finally, at 8.10 pm we have a speech from Fed Member Williams.
December S&P 500
The idea of buying into the 3180/3200 major support area for the S&P worked well yesterday as shortly after the U.S Markets opened the S&P traded lower to my 3198 buy level before rallying to my too tight 3215 T/P level and I am still flat. The S&P has now corrected over 10% since early September and is due a bounce given how oversold the market has got. However, for the S&P to regain momentum it needs to break and close over its 50-Day Moving Average. This will not be an easy task as this level is well above current prices at 3339 for the December Contract. Today I will continue to be a buyer on any dip lower to 3205/3222 with a wider 3193 stop. Ahead of the weekend, I do not want to be short the S&P at this time.
EUR/USD
No Change as I am still a buyer on any dip lower to 1.1570/1.1620 with the same 1.1535 stop. The Euro has strong support from 1.1420/1.1480 where I will be an aggressive buyer with a 1.1365 wider stop. Meanwhile I will still be a small seller from 1.1720/1.1760 with a 1.1795 stop.
December Dollar Index
No Change as I am still a buyer from 93.60/94.00 with the same 93.25 stop.
December DAX
The DAX just missed my 12425 initial buy level with a 12432 low print before rallying nearly 200 points into the close. I will now raise my buy level to 12395/12495 with a higher 12319 stop.
December FTSE
The FTSE rallied to my 5835 T/P level on yesterday’s 5795 long position. Subsequently I emailed my Platinum Members to re-buy the FTSE at 5780 before the market rallied to my 5800 T/P level and I am still flat. A combination of an oversold market and a weak Sterling should prevent the FTSE from trading much lower and as a result I am happy to be a buyer on dips. The FTSE has support from 5735/5785 where I will be a buyer with a 5685 stop. If I am taken long I will have a T/P level at 5830.
Dow Rolling Contract
The idea of lowering my stop on Wednesday’s 26950 long position worked well as the market obliged by trading lower to my second buy level at 26600 for a 26775 long position. Subsequently we rallied above 26900 and this move higher enabled me to cover this large long position at my revised 26850 T/P level and I am still flat. As long as the Dow does not close below 26300, I happy to buy the dip. Today my buy level will be from 26570/26770 with a 26395 wider stop. Ahead of the weekend I do not want to be short the market at this time.
December NASDAQ
Just like the Dow above, leaving a closing stop on the NASDAQ worked well with the market rallying shortly after the U.S Markets opened. As a result I was able to cover my 10875 long position for a small gain at 10905 and I am still flat. As long as the NASDAQ does not break and close below key support at 10500 I will continue to buy the dip. Today, my buy level will be from 10710/10860 with a wider 10595 stop. If I am taken long I will have a T/P level at 10950.
December BUND
I am still flat the Bund which is selling off as I go to post. I will now lower my buy level to 173.20/173.75 with a lower 172.85 stop.
Gold Rolling Contract
I am still flat Gold and I will now raise my buy level to 1835/1850 with a higher 1823 stop.
Silver Rolling Contract
Frustratingly, Silver just missed my by level by a few points before having a strong rally which was to be expected given its recent 25% decline. I will now raise my buy level to 21.80/22.50 with a higher 21.25 stop.
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