U.S. Equity Markets reversed earlier gains on Friday afternoon by closing lower across the board. The Dow led the losses, closing lower by 0.47% following a volatile last trading session for September. The late sell-off saw the VIX end Friday with a 1% gain at a price of 17.52. Over the weekend the U.S. Congress passed a last-minute stop-gap bill to keep the Government running for the next 45 days while disputing parties and warring factions within them try to hammer out a more enduring agreement. Equity Futures are trading higher this morning following the reprieve. Federal Reserve Bank of Chicago President Austan Goolsbee believes policymakers should not rely too heavily on the traditional relationship between unemployment and inflation. In his speech, he argued that this perspective does not fully capture the unique dynamics of today’s inflation and that it could ultimately lead to excess monetary tightening. Instead, as Goolsbee explained, policymakers should focus on components of core inflation (like housing prices) while monitoring productivity. Though he did not give his stance on whether more interest-rate increases are needed, he mentioned the Fed has done a “really excellent” job thus far in wrangling high inflation. U.S. consumer spending was revised lower to an annualised rate of 0.8%, down from the initial 1.7% reported for the second quarter of 2023. This new figure marks the weakest growth in more than a year. Gross Domestic Product, however, remained unchanged at a 2.1% growth rate during the same period. Offsetting the slowdown in personal consumption was a stronger business fixed investment (or spending from businesses to increase production), which jumped to 7.4%. The Fed will continue to monitor this data – and any revisions – as it tries to pilot a soft landing. Revised government data revealed that U.S. households have only saved 8.3% of their disposable income from 2017 to 2022, down from 9.4% as previously reported. The Bureau of Economic Analysis estimated that the reduced savings total roughly $1.1 trillion over the past six years. An accounting adjustment that lowered personal income from mutual funds and real estate investment trusts was to blame for the change. The revised savings data only adds to fears that high inflation has already eaten away most of the money Americans saved up during the pandemic. According to the National Association of Realtors, Pending Home Sales in the U.S. have plummeted 7.1% from July to August, reaching levels unseen since April 2020. The decline is due to mortgage rates nearly cresting a 23-year high, elevated prices, and limited inventory. Pending Home Sales also saw a 19% drop on a year-over-year unadjusted basis. This data underscores one of the most unaffordable housing markets Americans have ever seen. Peloton (PTON) and Lululemon (LULU) will create co-branded merchandise and combine fitness content under a newly announced partnership. The strategic move will allow Lululemon to focus on creating merchandise for retail on Peloton’s website and Peloton to distribute content on the clothing maker’s “Studio Mirror” devices. Lululemon will phase out its exercise hardware by the end of 2023 and begin to push users to Peloton’s services. The announcement comes as Peloton’s share price sits in the shadow of its 2021 peak of $167. Shares of PTON jumped 11% yesterday on the news. European Markets closed higher. Germany’s inflation dropped to its lowest level in two years – with a 4.3% year-over-year (“YOY”) growth in the country’s consumer price index (“CPI”). It is a significant decrease when compared with the 6.4% YOY CPI growth seen in August. The slowdown was largely due to the disappearance of heavily discounted public transport seen around this time last year. Despite the CPI decrease, inflation remained well above the European Central Bank’s (“ECB”) 2% target. The lower inflation number seen in Germany supports the expectation that the ECB will hold rates, though it does not indicate how soon the first-rate cut will follow. In Asia, Chinese President Xi Jinping has pledged to intensify efforts to meet the country’s annual economic goals. He emphasised the need to boost macroeconomic controls, expand domestic demand, and achieve continuous economic improvement. Additionally, Xi vowed to focus on job creation and risk prevention. His speech comes at a time when the Chinese economy is still trying to recover from its housing crisis. Analysts project that China will still achieve its economic growth target for 2023 with a 5% expansion expected. Elsewhere, Oil fell 1% while Gold ended the week with a further loss of 0.9% at a price of $1850.
To mark my 2875th 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 137 points on Friday to close September with a small gain of 228 points, after finishing August with 1485 points gain following a small gain of 285 points gain in July, after closing June with a gain of 2683 points. May closed with a gain of 3205 points. April saw a gain of 3354 points while March closed with a gain of 6168 points. The Platinum Service made 3164 points in February, 4687 points in January 2054 points in December, 4789 points in November and a record 9619 points last October. 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 0.27% lower at a price of 4288.
The Dow Jones Industrial Average closed 148 points higher for a 0.47% loss at a price of 33,507.
The NASDAQ 100 closed 0.08% higher at a price of 14,715.
The Stoxx Europe 600 Index closed 0.38% higher.
This morning, the MSCI Asia Pacific closed 0.5% lower.
This morning, the Nikkei closed 0.22% lower at a price of 31,788.
Currencies
The Bloomberg Dollar Spot Index closed 0.34% lower.
The Euro closed 0.1% higher at $1.0578.
The British Pound closed 0.1% lower at 121.95.
The Japanese Yen fell 0.1% closing at $149.45.
Bonds
Germany’s 10-year yield closed 9 basis points lower at 2.85%.
Britain’s 10-year yield closed 10 basis points lower at 4.46%.
U.S.10 Year Treasury closed 4 basis points lower at 4.58%.
Commodities
West Texas Intermediate crude closed 1% lower at $90.79 a barrel.
Gold closed 0.8% lower at $1850.10 an ounce.
This morning on the Economic Front we already had the release of U.K. Nationwide House Prices which came in flat at 0.00% versus -0.4% expected. Next, we have German, Euro-Zone and U.K. Manufacturing PMI at 8.55 am, 9.00 am and 9.30 am respectively. This is followed by Euro-Zone Unemployment Rate at 10.00 am and U.S. Manufacturing PMI at 2.45 pm. Finally, at 3.00 pm we have ISM Manufacturing and Construction Spending. Meanwhile, Fed Chair Powell is speaking at 4.00 pm and Fed Member Harker at 4.05 pm.
Cash S&P 500
My latest 4302 long S&P position finally paid off as the S&P made a Friday high at 4333 enabling me to cover this position at my 4321 T/P level. Subsequently the S&P was met by aggressive selling driving the market lower by 60 Handles before having a small rally into the close. This initial move lower saw my 4303 second buy level triggered as emailed to my Platinum Members. We had a small rally to my 4311.50 T/P level, and I am now flat. Congress passing a temporary bill to keep the U.S. Government open for the next 45 days saw the S&P hit an overnight high at 4317 before again being met by selling. This morning the S&P is trading at 4308 as I go to press. With the $BPSPX 14-Day RSI closing at 14 I cannot justify any short position despite the weak price action. The Seasonality Chart is positive until Friday before hitting the traditionally weak mid-October time frame. The S&P has support from 4280/4295 where I will be a strong buyer with a 4269 ‘’Closing Stop’’.
EUR/USD
I used Friday’s small rally in the Euro to exit my 1.0621 long position at my revised 1.0586 exit level as emailed to my Platinum Members and I am now flat. This morning the Euro is trading slightly lower at 1.0569. The Euro has support from 1.0480/1.0550 where I will again be a strong buyer with a lower 1.0425 ‘’Closing Stop’’. Given how oversold the Euro is trading I have no interest in being short the market.
September Dollar Index
No Change. I am still flat the Dollar as I continue to be a seller on any further move higher to 106.35/106.95 with the same 107.55 ‘’Closing Stop’’.
Cash DAX
Frustratingly, the DAX missed my initial 15300 buy level by 10 points before rallying to sit at 15420 this morning as I go to press. However, given the weakness in the DAX and the increased two-way price action I am not going to chase the market higher. Therefore, I will continue to be a buyer on any dip lower to 15220/15300 with the same 15135 ‘’Closing Stop’’.
Cash FTSE
No Change. The FTSE traded in a narrow range on Friday, and I am still flat. The FTSE continues to build value above its 200-Day Moving Average. Today, I will continue to be a buyer on any dip lower to 7500/7570 with the same 7445 ‘’Closing Stop’’.
Dow Rolling Contract
No Change. I am still long at an average rate of 33910 with a now lower 33970 T/P level. I will leave my ‘’Closing Price’’ of 33495 unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members. The 200-day Moving Average for the Dow comes in this morning just above current prices at 33809. For bulls to regain some control the Dow needs to break and close over this key resistance level.
Cash NASDAQ 100
My NDX plan worked well as the market traded lower to my 14670-buy level before rallying to my too tight 14740 T/P level and I am now flat. This morning the NDX is trading higher at 14820 helped by lower Treasury Yields. We have support from 14570/14720 where I will again be a buyer with a higher 14455 ‘’Closing Stop’’.
December BUND
The Bund had a nice rally off Thursday’s 127.05 low print. As I wanted to reduce the number of positions being carried into October, I emailed my Platinum Members to exit my 128.50 average long position for a small gain at 128.67 and I am now flat. This morning, the Bund is trading slightly lower at 128.25. We have support from 127.00/127.80 where I will be an aggressive buyer with a low 126.35 ‘’Closing Stop’’.
Gold Rolling Contract
Wrong! Frustratingly Gold just missed my 1881 T/P level with a Friday afternoon high at 1880. Subsequently, Gold got hit hard stopping out of my 1872 long position at 1853 and I am still flat. This morning, Gold is trading lower at 1840. Gold is oversold having fallen over $120 in the past few weeks. Gold has strong support from 1819/1834 where I will be an aggressive buyer with an 1807 wider ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 1854.
Silver Rolling Contract
No Change. I am still long Silver from three weeks ago at 24.05. In a change of strategy, I will have no stop or no T/P level on this position. This morning Silver is trading lower at 21.95. If this view changes, I will be back with a new update for my Platinum Members.
Recent Comments