U.S. Indexes closed the last session of the week in the red with all sectors lower, aside from Energy, as Materials and Utilities lag, while broad based mega-cap weakness added to the losses. Energy was the only sector in the green and buoyed by gains in the crude complex amid renewed escalation risk as President Trump returned from China and attention turned back to Iran. On that, little incrementally new came out of the Xi/Trump summit, and many await Trump’s return from China. As a reminder, source reports through the week suggested Trump is weighing up possibly resuming military action, but sources added they do not think he would order any before he returns from China, while Israeli sources added that readiness will be raised upon the end of Trump’s visit. There was plenty of commentary from Trump and the Iranian Foreign Minister on Friday, with the latter noting “we have received messages from the US saying that they are seeking continued talks”. The Dollar Index saw gains with Antipodeans, the clear G10 laggards, and hit by losses in Precious Metals and risk sentiment. Treasuries saw pressure, as yields rose, as higher oil prices added to inflation fears in quite a quiet newsflow in the US afternoon. Into the weekend, attention still lies on any indication whether Trump is set to resume military operations against Iran this weekend. On the data front, Industrial Production and Manufacturing Production both topped expectations, although the releases generated little meaningful market reaction, with focus remaining firmly on oil prices and geopolitics. Meanwhile, Fed speak focused on the balance sheet debate ahead of Fed Chair nominee Warsh’s expected arrival at the Fed. Fed’s Barr pushed back against arguments for a materially smaller balance sheet, potentially setting up future debate within the Fed given Warsh’s preference for a smaller balance sheet and reduced holdings of longer-dated Treasuries. Elsewhere, U.K. Gilts also came under pressure amid growing political uncertainty in the UK. The Manchester Mayor Burnham is looking to re-enter parliament, while Streeting’s resignation potentially sets up a future leadership contest involving Burnham, Streeting and Starmer. The weakness in Gilts added to the broader bearish tone in global fixed income markets and likely contributed to some follow-through pressure in Treasuries. Overall, price action remained dominated by energy markets and geopolitics, with higher oil prices lifting inflation expectations and weighing on the Treasury complex. Elsewhere, Oil closed higher by 4.5% while Gold was hit, closing lower by 2.4%.
To mark my 3375th 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 825 points on Friday and is now ahead by 1265 points for May having ended April with a gain of 1730 points, after ending March with a massive gain of 9002 points, having closed February with a strong gain of 5482 points after ending January with a gain of 4757 points, having closed December with a gain of 2599 points, after ending the month of November with a gain of 4542 points, after ending October with a nice gain of 5110 points after closing September with a gain of 3774 points while ending August with a gain of 3362 points after closing July with a gain of 3753 points after closing June with a gain of 3530 points, having closed May with a gain of 3606 points, after closing April with a gain of 7685 points after closing March with a gain of 2254 points while 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 2300 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 1.24% lower at a price of 7408.
The Dow Jones Industrial Average closed 537 points lower for a 1.07% loss at a price of 49,526.
The NASDAQ 100 closed 1.54% lower at a price of 29,125.
The Stoxx Europe 600 Index closed 1.48% lower.
This Morning, the MSCI Asia Pacific closed 0.7% lower.
This Morning, the Nikkei closed 0.70% lower at a price of 60,979.
Currencies
The Bloomberg Dollar Spot Index closed 0.47% higher.
The Euro closed 0.42% lower at $1.1620.
The British Pound closed 0.63% lower at $1.3317.
The Japanese Yen fell 0.26% closing at $158.76.
Bonds
U.K.’s 10-Year Gilt closed 11 basis points higher at 5.18%.
Germany’s 10-Year Bund Yield closed 8 basis points higher at 3.18%
U.S.10 Year Treasury closed 12 basis points higher at 4.60%.
Commodities
West Texas Intermediate crude closed 4.36% higher at $105.60 a barrel.
Gold closed 2.41% lower at $4539.10 an ounce.
This morning on the Economic Front we have a speech from ECB Member Elderson at 8.30 am and the Bank of England’s Mann at 9.30 am. The only other data of note is U.S. NAHB Housing Market Index which will be released at 3.00 pm.
Cash S&P 500
Last week the macro backdrop that I have been pointing toward for the past two months finally showed up in the prints. Inflation came back, and real yields on the long end pushed sharply higher. By Friday, Japan’s PPI had dragged the entire global sovereign curve higher, and US Treasury yields were pressing the breakout. Underneath, the equity tape spent the week telling two stories at once: the Treasury drain calendar arrived on schedule Tuesday and the selloff the daily reports had been pointing to “for two weeks” played out — then a handful of mega-cap names took the Index back up while everything underneath stayed weak. Every major developed-world central bank outside the Fed is now pricing hikes by year-end. The ECB, Bank of Canada, Bank of Japan and the Bank of England are all priced at 1 to 3. The argument was straightforward: if the Fed chooses to look through inflation while every other central bank raises rates, the market will do the tightening for them — inflation expectations rise, the back end of the curve moves much higher, and the Dollar takes damage along with equity investor confidence. That is not the setup Kevin Warsh wants to inherit, which is why the next several weeks of Fed-speaker commentary — and any signal from Warsh himself ahead of the June meeting — become the central watch-item. The cracks in the consumer economy are no longer just cracks — they are fault lines. In my opinion the Consumer Stress Index has surged to levels last seen during the COVID-19 pandemic and the Great Financial Crisis. Credit card delinquencies, auto loan defaults, and foreclosures are all climbing, and the energy price shock is pouring gasoline on an already stretched household balance sheet. This is not a soft patch — it is a consumer sector under genuine duress. Meanwhile, the Equity Market keeps humming while the “E” in P/E is not what it seems. Upward earnings revisions are making the S&P 500 look cheaper, but the upgrades are highly uneven within Technology and Energy and mask the downstream margin pressure from higher energy and input costs. Last Thursday was a record-setting day for the S&P 500 and NASDAQ. That was followed by Friday’s pullback and perhaps the start of a digestion period of the recent run-up. Looking at broader market, we see that it has not been confirming the record highs being reached by the S&P 500 and NASDAQ 100. Looking at the 2 day chart the “% of stocks above their 40- day Moving Average which is a near-term indicator. In January, this indicator reached my “Danger Zone” when nearly 68% of stocks were above their 40-day MA. That is when the market started its correction from mid-January to mid-March, a 2-month down move. After that there was a sharp up move, which took the indicator back into the “Danger Zone” in mid-April when over 65% of stocks were trading above their 40-day MA. Since then, this indicator has once again declined and now just 39% of stocks are above their 40-day MA. This shows you how the broader market has been weakening. Over the past year, when this indicator reached that Danger Zone, it signalled a pullback in the broader market. It is very important to recognise that the Indices shown on TV only reflect a minority of stocks. The “equal weight” Indices, which are a truer indicator of the market since each stock is given the same weight, are underperforming the widely publicised (cap-weighted) version of the Indices. The thinness of the stock market advance has been making records. In the 1970-1973 advance, the ‘’NIFTY FIFTY’’ famously received most of the attention. Now the focus is on only 5/10 stocks. The list of leaders is so thin that the S&P made a new all-time high with 5% of its components making new 52-week lows. Jason Goepfert reports that this has happened only four times in U.S. stock market history. They are: July 1929, January 1973, December 1999 and May 2026. Each of these key dates were followed by a CRASH. The S&P has an ‘Open Gap’ from two weeks ago from 7257/7294. I will use any tag of the gap to close my 7097 average short position and reassess if triggered. As I go to post Oil is trading above $106 and 10-Year Treasuries at 4.62% driving the S&P 50 Handles lower from Friday’s close at 7361. It will be interesting to see any follow-through when the Cash Markets open this afternoon. If this view changes I will be back with a new update for my Platinum Members.
EUR/USD
The Euro is trading 100 points lower from where I marked prices on Thursday. This move lower saw the Euro hit my buy range for a now 1.1620 long position. I will add to this position at 1.1540 while lowering my ‘Closing Stop’ to 1.1475. I will now lower my T/P level to 1.1690. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dollar Index
Friday’s Dollar rally saw the market hit my 98.75 T/P level on my latest 98.30 long position a and I am now flat. This morning the Dollar is trading higher at a price of 99.25. The Dollar has short-term resistance from 100.00/100.80 where I will be a seller with a tight 101.50 ‘Closing Stop’. If I am taken short, I will have a T/P level at 99.30. The Dollar has support below from 98.10/98.90 where I will again be a buyer with a 97.55 ‘Closing Stop’. If I am taken long, I will have a T/P level at 99.60. If any of these views change, I will be back with a new update for my Platinum Members.
Russell 2000
I am still flat. Today, I will lower my sell level to 2860/2930 with the same 3005 ‘Closing Stop’. If I am taken short, I will have a T/P level at 2810. Given how overbought the Russell is trading I still do not want to be long the market at this time.
FTSE 100
Higher Gilt Yields and a worsening political landscape saw the FTSE get hit hard on Friday. This move lower saw the whole of my buy range triggered for a now 10210 average long position. I will leave my 10105 ‘Closing Stop’ unchanged while lowering my T/P level to 10280. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dow Rolling Contract
I am still flat the Dow. Today, I will lower my Dow buy level to 48450/48750 where I will again be a buyer with a lower 48195 ‘Closing Stop’. If I am taken long, I will have a T/P level at 49080. I still do not want to be short the Dow at this time.
Cash NASDAQ 100
My NDX plan worked well as the market sold off to my revised 29190 T/P level on my latest 29390 average short position and I am still flat. As we know the NASDAQ 100 is a speculative retail trader’s favorite. It had a straight up move since late March, gaining 29% in about 6 weeks. But on Friday the ETF for NASDAQ 100, QQQ, had its biggest daily decline since March 27, ending its 6-week winning streak as a result. The technical indicators are turning negative. A 10% decline would be bring it to first good support. This morning, the NDX is trading at a price of 28950. We have short-term resistance from 29150/29350 where I will again be a seller with a 29555 ‘Closing Stop’. If I am taken short, I will have a T/P level at 28730.
December BUND
I was lucky that the Bund rallied to my 125.55 T/P level on my latest 124.95 long position before falling 150 points on Friday. 10-Year Treasuries rallying to 4.60% is a serious headwind for UK and Euro-Zone Bond Yields meaning there is every chance Interest Rates will rise next month. The Bund has short-term support from 123.00/123.70 where I will be a strong buyer with a lower 122.35 ‘Closing Stop’. If I am taken long, I will have a T/P level at 124.50.
Gold Rolling Contract
Overnight Gold traded lower to my revised 4490 buy level as emailed to my Platinum Members. As I am now long Silver, I have exited this 4490 long position here at 4542 and I am now flat. Gold has support below from 4350/4450 where I will again be a buyer with a lower 4245 ‘Closing Stop’. If I am taken long, I will have a T/P level at 4590 If this view changes, I will be back with a new update for my Platinum Members.
Silver Rolling Contract
Silver got hit hard on Friday, closing lower by a whopping 10%. This sell-off saw the market hit my buy range for a now 76.00 long position. I will add to this trade at 73.00 while leaving my 70.15 ‘Closing Stop’ unchanged. I will now lower my T/P level to 77.50. If any of the above levels are hit, I will be back with a new update.
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