As has been touted in recent days, the IMF confirmed that Greece has asked the IMF to bundle its four June payments into one, delaying therefore the €301mn payment due to the Fund tomorrow. IMF spokesman Gerry Rice said that under a Fund Executive Board decision of the late 1970s, Member Countries can ask the Fund to bundle multiple principal payments due in a calendar month into one. Greek PM Tsipras is due to speak to the Greek Parliament early tomorrow morning and apparently to respond to its European creditors on Monday on a reform plan given to Greece.
For anybody following my new Platinum Service, the results so far this week are, Monday +460 points, Tuesday + 40 points, Wednesday +310 points and yesterday a lucky + 20 points as I emailed all my Platinum Members to exit their S&P position at 2109.
Europeans are pressing for agreement by June 14. German Chancellor Merkel is quoted overnight saying that “we are from reaching a conclusion”, that combined with the payment bundling points to a further episode of “kicking the can down the road” and still with no evident structural resolution to Greece’s debt issues. Against that background and continuing wire chatter yesterday, the Euro rallied for a time to over 1.1380 (on what looked to be some USD softness for a time), but has since given up those gains to be trading just below 1.1250 in the lead up to Non-Farm Payrolls at 1.30 pm. Adding some spice into the mix for the US Dollar, the IMF has weighed into the rate lift-off debate yesterday afternoon in its US Article IV Annual Report on the Economy saying that rate lift off should be delayed until 2016. Yesterday’s US trade report for April reported an encouraging start for trade into Q2 pointing to the absence of what was a large net export drag in Q1.
The big loser currency wise over the past 24 hours has been the AUD in what has been a very whippy week for the Aussie battler. It started the week soft after weak Capex, surging after the RBA Board and GDP, but falling back again yesterday after softer retail sales and the trade blowout. The AUD overnight is somewhat weaker again in net terms overnight and trading just below 0.77 this morning. Iron ore spot prices were up a strong $1.44 yesterday to $64.77, the highest levels since early this year.
Today is another very important day for economic data on what has been a tumultuous week for trading. First up we have German Factory Orders at the very early time of 7.00 am. At 9.30 am we have UK Halifax House Prices MoM. This is followed at 10.00 am by Euro-Zone GDP. Then at 1.30 pm we have US Non-Farm Payrolls where the consensus is for a 227K rise compared to last month’s 223k increase. At 5.30 pm we have a very important speech by Fed Member Dudley who will speak on the Economy and Monetary Policy. Finally at 8.00 pm we have US Consumer Credit.
In my 843 posts of writing Tradernoble yesterday was the first day where every market that I cover got triggered.
June S&P 500
The S&P had a wild trading session yesterday and with Non-Farm Payrolls due at 1.30 pm, today has the makings of an equally volatile trading session. By the time the European Markets opened yesterday morning the S&P was already getting hit hard to the downside with the market at my 2103 buy level. Following a volatile few hours of trading the S&P finally rallied after the US Markets opened which enabled me to cover this position at 2109 and I am now flat. Today I am going to stay flat until we get the Unemployment data out of the way as yet again the market closed just above the key 2095 major support level. If the market rallies on the data I will be a small seller from 2107/2113 with a 2118 stop. On the other hand if the S&P falls following the Payrolls I will be a small buyer on any dip to 2078/2083 with a 2073 stop.
EUR/USD
My Euro plan worked very well yesterday as shortly after the European Markets opened the Euro traded lower to my 1.1240 buy level before having a nice rally which enabled me to cover this position as outlined in my Platinum Service at 1.1300 and I am now flat. Today is a crucial day for the Euro as we have the ongoing Greek situation and then the Payroll data later. I expect the Euro to be extremely volatile and today I will again look to buy the market on any dip lower to 1.1160/1.1200 with a 1.1120 stop. Despite the Euro having a nice fall after making its intraday high at 1.1380 I still do not want to be short the Euro at this time.
June Dollar Index
My Dollar plan also worked well yesterday as shortly after the European Markets opened the Dollar traded higher to my 95.60 sell level before having a nice sell-off which enabled me to cover this position at 95.10 as indicated in my Platinum Service and I am now flat. Today I will again be a small seller on any rally higher to 95.80/96.20 with a 96.60 stop. My only interest in buying the Dollar is still on a dip to 92.80/93.30 with a 92.40 stop.
June DAX
Unfortunately my DAX plan did not work out yesterday as shortly after the market opened the DAX traded lower to my 11330 buy level before stopping me out of this trade near the lows at that time of the day at 11260 before having a 200 point rally as soon as the Euro started to fall which is very frustrating and I am now flat. There is no doubt that the DAX is the most difficult and volatile market to trade at this time as you need very wide stops and thus a very small position size. Today I will be a small buyer into yesterday’s late lows at 11190 by trying to be a very small buyer from 11170/11210 with an 11120 stop. If I am taken long and subsequently stopped out of this small trade I will be a more aggressive buyer in front of 11070 with a 10990 stop. I still do not want to be short the market at this time as news of a Greek deal will send this market soaring.
June FTSE
My FTSE plan did not work out well yesterday but at least I had a tight stop at 6865 after the market had hit my 6900 buy level and I am now flat. I have to respect the fact that the FTSE finally closed below the key 6850/6880 major support and this level should act as good resistance from here. For that reason I will be a small seller on any rally higher to 6845/6875 with a tight 6905 stop. I am going to stand aside from buying the market today as I want to see if this market can now build some momentum to the downside after this key closing break yesterday.
Dow Rolling Contract
The Dow plan also worked well today as the market was selling off as soon as the European Markets opened which enabled me to go long at 18020 before having a nice spike higher after the US Markets opened which enabled me to cover this position at 18090 and I am now flat. Today I am going to stay flat until we get the Payroll data printed and if the market rallies I will be a small seller from 18100/18150 with an 18180 stop. My Only interest in buying the Dow is on a dip to 17750/17800 with a 17690 stop as the 17750 is the next major support point and hopefully will give support to the market in the event of a major sell-off over the next few days.
September BUND
What can I say about the incredible volatility in the BUND yesterday and indeed all week. As expected I was stopped out of my 150.50 long position soon after the market opened at 149.90 but thankfully I had a rebuy order at 149.30 which worked very well. Unfortunately as outlined in my Premium Service I had a much too early exit strategy on this long resulting in me covering this position at 150.10 and I am now flat. Today I will again be a small buyer on any dip lower to 149.90/150.40 with a 149.35 stop. Given how oversold this market is currently trading and the fact that we got a decent reversal yesterday I do not want to be short the BUND at this time.
Gold Rolling Contract
I have to say that I am amazed by how weak Gold is trading especially with all the uncertainty currently prevailing in all markets at this time. My long 1184 Gold position was stopped out for a small loss yesterday at 1175 and I am now flat. I am going to stand aside the Gold market today as I want to see how the market reacts to finally breaking and closing below the key 1180 level.
Silver Rolling Contract
Just like Gold above my long 16.70 Silver position was also stopped out yesterday afternoon at 16.20 in what was a nasty sell-off across nearly all the Commodity Markets. I am still a long time believer in Silver and today I will again try the buy side on any further dip to 15.40/15.90 with a 14.95 stop.
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