Yesterday was another quiet though profitable trading session with little in the way of top tier data apart from the company reporting season. Again, anything Japanese related has been volatile with markets gyrating on rumours of the extent of the Fiscal and Monetary stimulus. While coordinated Fiscal and Monetary bazooka is less likely, a recent article by TradeTheNews.com suggests some Bank of Japan Board Members favour closer co-operation with the Government. The end result was that the Yen finished unchanged, the Nikkei fell 1.1% and Japanese Bond Yields rose 1.7 bps to be at -0.27%.
To mark my 1100th issue of Tradernoble Daily Commentary I am offering a special 2 year rate of Euro 2500 for my Platinum Service which includes 1/4 updated emails throughout the trading day. This offer is open to both new and existing members and if anyone is interested please email me on bryan@tradernoble.com for details.
For anyone following my Platinum Service it made 115 points yesterday and is now ahead by 1510 points for July having made 2550 points in June. The previous three months saw gains of 1532, 2175 and 2265 points respectively. Since I started this Platinum Service in June 2015 it has averaged a monthly gain of over 2200 points.
As Monday is a Bank Holiday in Ireland my next Daily Commentary will be on Tuesday. Finally I would like to wish all my members a happy and safe long weekend.
Global equities were little changed apart from Europe where banking stocks helped drag the EuroStoxx down 1.1% with disappointing results from Deutsche Bank. US equities after initially trading lower eventually closed 0.2% higher after a late day rally. This move did conceal some company specific moves with Ford falling sharply on disappointing earnings, offset by solid earnings from Facebook and Mastercard. There was little in the way of US data with most second-tier indicators in line with consensus including Weekly Jobless Claims which printed +266K versus +262K expected.
There was also little action in major Bond Yields. US Treasury Yields rose 1bps to 1.51% having fallen 6bps the previous day, while German Bunds fell 1bp to close at -0.9%. It appears markets have concluded that the Fed is not hankering to hike rates in the near future and still prices in only a 50% chance of a hike by year-end. That sentiment also probably contributed to broad US Dollar weakness, with the Euro, Canadian Dollar, Aussi Dollar and Kiwi all higher by around 0.2%, while the British Pound fell 0.3%.
In the commodities space, oil prices have continued their downward slide with oil prices falling 1.9% to $41.11 for WTI, which is the lowest level since mid-April after the EIA said US Crude Inventories and Gasoline stockpiles rose. Meanwhile Iron ore has been the surprising outperformer, rising 3.5% to $60.7 a tonne, which is its highest level since early May.
On the economic front we have the BoJ Monetary Policy rate decision at 3.45 am. This is followed at 9.30 am by UK Mortgage Approvals. At 10.00 am we have Euro-Zone Unemployment, CPI and GDP. Next we have US GDP and Employment Cost Index at 1.30 pm. Finally we have the Chicago Purchasing Manager’s Index and University of Michigan Consumer Sentiment Index at 2.45 pm amd 3.00 pm respectively.
This afternoon the Fed’s San Francisco President Williams will give a talk on ‘’ What’s left in the Fed’s Toolkit?’’
September S&P 500
My S&P plan worked well yesterday with the market trading lower to my 2154 buy level before having a nice 10 Handle rally which enabled me to cover this position at my 2159 T/P level as outlined earlier to my Platinum Members and I am now flat. With the long awaited BoJ Policy Meeting due overnight which should drive the market’s next direction I am glad that I am flat. The Fiscal and Monetary Stimulus is key because if they do not announce enough of package then markets could get hit hard but I suspect the fact that former Fed Chair Bernanke was helping the BoJ recently I would expect the stimulus to be large. Today I will again look to buy the S&P on any dip lower to 2147/2153 with a 2142 stop. With today been the last trading day for July I still do not want to be short the market at this time as we should see some new monies enter the market today and on Monday for the beginning of a new month.
EUR/USD
No change as I am still a buyer of the Euro on any dip lower to 1.1010/1.1040 with a 1.0970 stop. I still do not want to be short the Euro at this time as mentioned at length in yesterday’s Daily Commentary.
September Dollar Index
No change as I am still a small seller on any rally higher to 97.20/97.50 with a 97.90 stop.
September DAX
Finally the DAX traded higher to my 10375 aggressive sell level before the market traded 100 points lower which enabled me to cover this large position at my 10320 T/P level and I am now flat. Today I will again look to sell the DAX on any further rally higher to 10420/10480 with a stop above the April high at 10530. I will still look to buy the DAX on any dip lower to 10130/10190 with a 10070 stop.
September FTSE
Yet again the FTSE traded in a very narrow range and I am still flat. Today I will again look to buy the market on any dip lower to 6580/6625 with a 6545 tight stop. With month-end today and the beginning of a new month on Monday I do not want to be short the FTSE at this time despite the fact that this market is very over-bought and due a correction. I am hoping that this correction will come from a higher level which I will take a look at on Tuesday.
Dow Rolling Contract
My Dow plan also worked well with the market trading lower to my average buy level at 18390. As I was having a profitable trading session I emailed my Platinum Members that I was covering this long position way too early at 18400 before the market traded 80 points higher and I am now flat. With month-end tomorrow I will again look to buy the Dow on any dip lower to 18290/18360 with an 18240 stop. I still do not want to be short the Dow at this time as I would prefer if the Dow closed below its 2015 high at 18351 first before looking to set up a short position.
September BUND
Unfortunately the Bund just missed my 167 buy level with a 167.11 low print before trading higher into the close and I am still flat. Today I will leave my buy level unchanged at 166.60/167.00 with a 166.30 stop which is just below the key support level at 166.50. My only interest in selling the Bund is still on a rally higher to 168.10/168.50 with a 168.80 tight stop.
Gold Rolling Contract
As I am back long Silver again I will now lower my buy level in Gold to 1310/1318 with a tight 1304 stop.
Silver Rolling Contract
Silver eventually traded lower to my 20.10 buy level. I am still long and I will now raise my stop on this position to 19.55. If I am stopped out of this trade I will be a more aggressive buyer in front of 19.25 with an 18.80 stop.
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