U.S. Equity Markets finished the day higher after a dramatic reversal in the last three hours of trading. The NASDAQ 100 led the gains closing higher by 2.75%. U.S. Federal Reserve Vice Chairwoman Lael Brainard said she believes it would be appropriate for the central bank to hike interest rates by 0.5% during its June and July meetings. However, she noted that it was too soon to say whether the Fed will taper the pace of its rate hikes in the months that follow… Amid recent data showing a softening in the economy, it remains unclear whether inflation has peaked. This may have helped to boost Indexes, as some investors adopted a risk-on sentiment – resulting in many purchasing shares of beaten-down stocks at attractive prices. Within the S&P 500, 10 of the 11 sectors finished higher. European Markets closed mixed. European Central Bank Governing Council Member Edward Scicluna said it is unlikely there is enough support for a 0.5% interest-rate increase at the July meeting. European Central-Bank Governing Council Member Francois Villeroy de Galhau said inflation is too broad and policy must quickly normalize. Growth for the Euro-Zone Producer Price Index in April was weaker than expected, easing versus March due to a slowdown in energy-cost growth. In Asia, Taiwan and the U.S. revealed a blueprint for strengthening trade ties going forward, adding that the two will meet in Washington, D.C. in June – a move that could potentially stoke tensions with China. S&P Global’s South Korean Manufacturing Purchasing Managers’ Index (“PMI”) figures for May eased versus April due to output falling into contraction territory. Bank of Japan board member Seiji Adachi said it’s too soon to consider tightening monetary policy, as households are still trying to recover from the COVID-19 pandemic. China’s government ordered state-owned banks to establish $120 billion worth of credit lines for infrastructure projects to support domestic economic growth. Elsewhere, Oil rose 1.86% after the Energy Information Administration reported U.S. inventories saw a substantial decline last week, while Gold closed 1.29% higher after the Dollar weakened.
To mark my 2550th issue of TraderNoble Daiy 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 75 points yesterday and is now ahead by 605 points for June after making 3651 points in 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. 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 1.84% higher at a price of 4176.
The Dow Jones Industrial Average closed 435 points higher for a 1.33% gain at a price of 33,248
The NASDAQ 100 closed 2.75% higher at a price of 12,892.
The Stoxx Europe 600 Index closed 0.2% lower.
Yesterday, the MSCI Asia Pacific Index rose 0.1%.
Yesterday, the Nikkei closed 0.16% lower at a price of 27,413
Currencies
The Bloomberg Dollar Spot Index closed 0.6% lower.
The Euro closed 0.8% higher at $1.0745.
The British Pound closed 0.8% higher at 1.2569.
The Japanese Yen rose 0.2% closing at $1.2988.
Bonds
Germany’s 10-year yield closed five basis points higher at 1.23%.
Britain’s 10-year yield closed one basis points higher at 2.17%.
US 10 Year Treasury closed one basis points lower at 2.90%.
Commodities
West Texas Intermediate crude closed 1.86% higher at $116.05 a barrel.
Gold closed 1.29% higher at $1872.10 an ounce.
This morning on the Economic Front we have German and Euro-Zone Global Services PMI at 8.55 am and 9.00 am respectively, followed by Euro-Zone Retail Sales at 10.00 am. Next, we have U.S. Non-Farm Payrolls, including the Unemployment Rate and Average Earnings at 1.30 pm. Finally, we have PMI at 2.45 pm and ISM Services PMI at 3.00 pm.
Cash S&P 500
I had the correct view of buying the Dip in the S&P yesterday, but unfortunately the S&P missed my 4070 buy level with a 4073 low print before rallying over 100 Handles into the close. All eyes will be on the NFP data at 1.30 pm. Bears are getting more frustrated as despite the bearish news yesterday, American Indexes surged. Remember a market that cannot sell-off on bad news has to be respected as in my opinion most of the bad news is priced into the market and is the main reason why I continue to hold my long NDX position. The S&P has short-term support from 4115/4145 and I will move my buy level to this area with a higher 4099 stop. My only interest in selling the S&P is on a further rally to 4210/4235 with a tight 4253 stop.
EUR/USD
Buying the dip in Euro has worked well over the past two weeks. Yesterday the Euro rallied tom my 1.0695 T/P level on Wednesday’s 1.0660 long position and I am now flat. Today, I will again be a buyer on any dip lower to 1.0630/1.0690 with a 1.0575 stop. I still do not want to be short the Euro at this time.
March Dollar Index
The Dollar reversed most of Wednesday’s rally, selling off to my 101.90 T/P level on my 102.20 average short position and I am now flat. Today, I will again be a seller from 102.20/102.90 with a 103.15 tight stop. If I am taken short I will have a T/P level at 101.80.
Cash DAX
The DAX traded in a narrow range yesterday and I am still flat. The continued rise in Bund Yields is hindering any real progress in European Stock Markets. I am still flat the DAX. Ahead of the NFP data I will raise my buy level slightly to 14180/14280 with a higher 14095 stop.
Cash FTSE
I am still flat. Just like the DAX, the FTSE traded in a narrow range. Ahead of the NFP data, I will now raise my sell level to 7650/7710 with a higher 7755 stop.
Dow Rolling Contract
Frustrating! The Dow made a low at 32508, 8 points above my 32500 aggressive buy level before rallying over 700 points into the close and I am still flat. Hopefully you managed to buy in front of my buy range given the spectacular reversal. In my opinion, it is looking more and more likely that the market made a significant low two weeks ago. The Fed will not raise rates much above 2.5% as they can’t given the level of debt in the system. Just like 2018 when rates did hit this level the S&P crashed and Powell had to introduce more QE to prevent A Major Recession. The Dow has short-term support from 32800/33050 where I will be a small buyer with a 32595 stop. Ahead of the weekend I do not want to be short the Dow at this time.
Cash NASDAQ 100
The NDX was the strongest of the American Indexes again yesterday. The market did not hit my second buy range as I continue to hold onto to my April long position at 14327. I am happy with the rebound in the NDX this week. I will now raise my exit level on this position to 13400. I will not add to my long position today and if anything changes post the NFP data I will come back with an update for my Platinum Members.
June BUND
The Bund got hit hard again yesterday, trading to new Contract lows. I am still long at 151.20 as the Bund is severely oversold. Ahead of the NFP data I will have no stop on this position as we have some room to play with given Wednesday’s gains. I will leave my T/P level unchanged at 151.65. If any of the above levels are hit I will be back with a new update for my Platinum Members.
Gold Rolling Contract
The weaker Dollar saw the price of Gold rally yesterday and I am still flat. I will now raise my buy level to 1830/1845 with a tight 1819 stop.
Silver Rolling Contract
I am still flat. I will now raise my Silver buy level to 21.50/22.10 with a tight 20.95 stop.
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