U.S. Indices closed Friday in positive territory but the steep weekly decline remained amid US growth concerns and continued tariff uncertainty. Once again, Friday was a heavy headline day with a deluge of risk events, such as the US jobs report, a load of Fed speakers (Powell the highlight), as well as President Trump and his top execs speaking. Recapping NFP, the headline fell slightly short of expectations but perhaps not as bad as feared, although there is tremendous uncertainty ahead with government job cut efforts from the DOGE. Otherwise, in the report, it was soft – the Unemployment Rate rose to 4.1% from 4.0%, despite expectations for it to be unchanged, but still remains below the year-end Fed forecast of 4.3% (which is set to be updated in March). In addition, Fed Chair Powell largely reiterated his messaging from January and February, stressing the Fed is not in a rush to adjust policy with uncertainty ahead, but the economy remains in a good place. Note, the Fed goes into blackout today ahead of the March 19th FOMC meeting. From Trump, there was a deluge of tariff talk (more details below), but the main takeaways were remarks on Canada, warning he may do reciprocal tariffs as early as today or Monday, and also on Truth stating he is “strongly considering” imposing “large scale” sanctions and tariffs on Russia until a ceasefire and final peace settlement for Ukraine is attained. Sectors closed largely firmer, with Utilities sitting atop of the pile, while Consumer Staples and Financials lagged as the former was weighed on by COST (-6%) post-earnings. Elsewhere, the Dollar was lower and continued its week of losses, which saw the Canadian Dollar lag amid the aforementioned tariff uncertainty. Treasuries chopped but were ultimately lower as risk sentiment improved into the weekend. Lastly, the crude complex was again choppy, albeit settling with slight gains but couldn’t prevent a week of losses, which initially stemmed from OPEC raising oil output. Headline NFP rose by 151k in February, beneath the expected 160k while the prior was revised down to 125k from 143k, seeing two-month net revisions of -2k vs the prior +100k. The headline showed that perhaps the job numbers were not as bad as feared when going into the report, but there is tremendous uncertainty ahead with government job cut efforts from the DOGE. There are also economic slowdown fears and cost pressure fears due to US President Trump’s tariff policy. Elsewhere in the report, it was soft. The unemployment rate rose to 4.1% from 4.0%, despite expectations for it to be unchanged, but still remains below the year-end Fed forecast of 4.3% (which is set to be updated in March). Wages were in line at 0.3% M/M but softer than forecast at 4.0% Y/Y (exp. 4.1%), while the prior’s saw revisions lower to 0.4% from 0.5% and 3.9% from 4.1%, respectively. Elsewhere in the report, the measures of slack saw the U6 unemployment rate rise to 8.0% from 7.5%, suggesting labour market slack is increasing, while the participation rate fell to 62.4 from 62.6%. Overall, this data is unlikely to sway the Fed thought process too much with fears of economic growth ahead currently the focus point with lots of uncertainty ahead. Money Markets are pricing in 70bps of rate cuts this year with the next cut fully priced by June. The Fed is widely expected to keep rates unchanged in March but it is currently 50/50 for May; we see the updated dot plots and economic projections at the March meeting which will help us further understand the Fed’s thought process at the moment. US President Trump, speaking on Canada, warned he may do reciprocal tariffs as early as today or Monday. Trump said Canada has tremendously high tariffs on lumber, and Canada has been ripping them off on dairy and lumber for years, while also noting the EU has been a terrible abuser of tariffs. He threatened sanctions and tariffs on Russia due to them continuing to strike Ukraine, which is making peace talks difficult. Elsewhere, the USTR will hold a hearing on 11th March on China’s effort to target the semi-industry for dominance. White House trade advisor Navarro says automakers have pledged to move supply chains to the US more quickly as part of trade negotiations. On reciprocal tariffs, it will focus on one tariff rate for each country to reflect tariff and non-tariff measures. On India, US Commerce Secretary Lutnick said India has one of the highest tariffs in the world, calling for rethinking of India-US relationship, adding they would like to focus on bilateral trade and for India to bring down tariffs. Lutnick also noted that it is time to do something big, not go product-to-product. India’s market cannot remain closed for agricultural products, some products can have quotas and limits to craft a deal. The US wants manufacturing of pharmaceuticals and semiconductors to come home with support of tariff wall. On South Africa, US President Trump posted that “South Africa is being terrible” with reference to the agriculture sector. The US will be stopping all Federal funding. On Brazil, Lutnick informed Brazil’s Vice President in a call that the US could postpone tariffs on Brazilian goods. Meanwhile, Fed Chairman Powell largely reiterated his messaging from January and February, stressing the Fed is not in a rush to adjust policy with uncertainty ahead, but the economy remains in a good place. He did acknowledge that recent data points to possible moderation in consumer spending and heightened uncertainty, but it remains to be seen how these may affect future spending and investment. Nonetheless, in the Q&A Powell said the general thought is that a one-time jump in prices does not need a monetary policy response, and that the economy is fine, it does not really require them to do anything at the moment. Powell noted there is still a lot of uncertainty about what will be tariffed and for how long and at what level, but warned if that turns into a series of actions, or if tariffs are larger, or expectations start to move, that will influence how the Fed reacts. He stressed that what really would matter is what is happening with longer-term inflation expectations. He did note that most longer-term inflation expectations remain stable and consistent with the 2% inflation goal. As expected, last Thursday, the ECB pulled the trigger on a 25bps reduction to the Deposit Rate, taking it to the upper limit of the estimated neutral range. Greater attention fell upon the Governing Council’s decision to tweak its policy statement so that it reads “monetary policy is becoming meaningfully less restrictive” (prev. “monetary policy remains restrictive”). Elsewhere, the Bank opted to reiterate its data-dependent and meeting-by-meeting approach, whilst stating that it will not pre-commit to a specific policy path. For the accompanying macro projections, the headline 2025 inflation forecast was raised to 2.3% from 2.1%, 2026 held at 1.9% and 2027 trimmed to 2.0% from 2.1%. On the growth front, policymakers cut their 2025 and 2026 growth views whilst holding 2027 at 1.3%. At the follow-up press conference, President Lagarde remarked that the statement language tweak was not an innocuous change and word changes have meaning. She added that the ECB is now moving towards a more ‘evolutionary approach’. With regards to the policy decision, all policymakers, with the exception of Austria’s Holzmann (who abstained) backed the announcement. In terms of where the ECB goes from here, Lagarde suggested that the GC could cut again or pause its cutting cycle depending on the data. The fact that Lagarde classified the policy discussion as “lively” and “intense” suggests upcoming decisions will become more contentious. Overall, the ECB’s policy path is an incredibly uncertain one with Lagarde suggesting that the Bank needs time to assess recent fiscal announcements from the EU and Germany, whilst also awaiting clarity on the Trump tariff regime. As such, policymakers appear to be buying for time before committing to their next move. Elsewhere, Oil closed higher by 1.02% while Gold ended Friday with a 0.2% loss.
To mark my 3150th 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 35 points on Friday and is now down by 161 points for March after closing February with a gain of 4180 points. January ended with a gain of 2768 points while 1997 points were gained in December. October ended with a gain of 2179 points, after closing September with a gain of 4402 points, following a loss of 301 points in August. July gained 1908 points while June saw a gain of 2074 points. The Platinum Service made a record 9619 points in October 2022. 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 0.55% higher at a price of 5770.
The Dow Jones Industrial Average closed 222 points higher for a 0.52% gain at a price of 42,801.
The NASDAQ 100 closed 0.74% higher at a price of 20,201.
The Stoxx Europe 600 Index closed 0.46% lower.
Last Friday, the MSCI Asia Pacific closed 1.3% lower.
Last Friday, the Nikkei closed 2.17% lower at a price of 36,887.
Currencies
The Bloomberg Dollar Spot Index closed 0.15% lower.
The Euro closed 0.3% higher at $1.0830.
The British Pound closed 0.2% higher at 1.2923.
The Japanese Yen rose 0.4% closing at $148.05.
Bonds
Germany’s 10-year yield closed 5 basis points higher at 2.85%.
Britain’s 10-year yield closed 5 basis points lower at 4.60%.
U.S.10 Year Treasury closed 2 basis points higher at 4.30%.
Commodities
West Texas Intermediate crude closed 1.02% higher at $67.04 a barrel.
Gold closed 0.2% lower at $2909.10 an ounce.
This morning on the Economic Front we have German Industrial Production and the Trade Balance at 7.00 am, followed by Euro-Zone Sentix Investor Confidence at 9.30 am. Next, we have U.S. New York 1-year Consumer Inflation Expectations at 3.00 pm. Finally, we have a six-month Treasury Bill Auction at 4.30 pm.
Cash S&P 500
Another crazy couple of trading sessions for the S&P. The only difference on Friday was the late 100 Handle rally off the afternoon 5667 low print into the close. This was significant as it meant that the 200 Day Moving Average (5733) held to close the week. Friday’s move lower saw my second buy level at 5740 triggered for a now 5789 average long position. I will now lower my T/P level to 5820 while my ‘’Closing Stop’’ is now at a price of 5725. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
EUR/USD
Wrong! The Euro rose over 500 points last week, closing at its highest level since last September. This move higher saw my latest 1.0725 short position stopped at 1.0825 and I am now flat. I wrote at length about the rise of the Euro in Thursday’s commentary and my view that the ECB were wrong in cutting rates. Analysing ECB President’s Lagarde’s press conference it is clear that this will be the last rate cut for a while as inflation refuses to hit the bank’s 2% target level. Following Friday’s move higher the Euro is now even more overbought and due a correction. The Euro has short-term resistance from 1.0860/1.0930 where I will be a strong seller with a higher 1.1005 ‘’Closing Stop’’. Given how easily the Euro broke last week’s 200 Day Moving Average, this level at 1.0734 should act as strong support on any tag. Therefore, I will be a small buyer from 1.0670/1.0740 with a 1.0595 wider ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 1.0790. If I am taken long, I will have a T/P level at 1.0790.
Dollar Index
Late Friday the Dollar sold off to my second buy level at 103.50 for a now 103.75 average long position. Given how oversold the Dollar is trading I will only lower my T/P level on this position to 104.60. I will leave my 102.85 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Russell 2000
Unfortunately, the Russell just missed my second buy level at 2030 by two points before rallying to sit at 2078 as I go to post. I am still long from last week at 2080 with the same 2130 T/P level. I will continue to look to add to this position at a higher price of 2040. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash FTSE
The FTSE never came close to last week’s sell range and I am still flat. It is noticeable that every dip in the FTSE is being bought despite the market continuing to trade overbought. I suppose this is no surprise given the strength of the DAX. Thankfully, we have stopped trading the DAX as this market continues to defy all logic. I will bring the DAX back into my Daily Commentary when I feel my edge has returned or should I say when the market starts to trade on fundamentals. The FTSE has support below from 8600/8670. I will be a buyer on any dip to this area with an 8535 ‘’Closing Stop’’.
Dow Rolling Contract
My Dow plan worked well. After the market traded the whole of Thursday’s range for a 42550 average long position the Dow rallied to my revised 42610 T/P level as I wanted to reduce some of my equity exposure. Subsequently, I emailed my Platinum Members to rebuy the Dow at 42200 (triggered on Friday afternoon) before the market rallied to my 42550 T/P level and I am now flat. This morning, the Dow is trading lower at a price of 42580 as I go to post. We have support below from 42170/42430 where I will again be a buyer with a 41995 ‘’Closing Stop’’. Given how oversold the Dow is trading, I still do not want to be short the market at this time.
Cash NASDAQ 100
Wrong! I was stopped out of my 20570 average long NDX position at 20195. This morning, the NDX is trading higher at 20100, having hit an overnight low so far at 19905. I have bought the NDX here at 20100. I will add to this position at 19950 with a now lower 19795 ‘’Closing Stop’’. I will have a T/P level at 20260 on this position. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
December BUND
My Bund call worked well as the market traded lower to my 127.60 buy level on Thursday before rallying to my 128.70 revised T/P level as emailed to my Platinum Members and I am now flat. This morning, the Bund is trading at a price of 127.90. We have strong support from 127.00/127.80 where I will again be a buyer with the same 126.15 wider ‘’Closing Stop’’. If triggered, I will have a T/P level at 128.80.
Gold Rolling Contract
No Change: Gold continues to attract large buying on any dip, wiping out all of Friday’s sell-off in a bid only session on Monday. I am still flat. I will now raise my buy level to 2830/2846 with a higher 2817 ‘’Closing Stop’’.
Silver Rolling Contract
I am still flat. I will continue to be a buyer on any dip lower to 30.70/31.50 with the same 29.85 ‘’Closing Stop’’. If triggered, I will have a T/P level at 32.20.
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