U.S. Equity Markets closed lower for the sixth consecutive trading session led by the NASDAQ with notable downside in Nvidia (NVDA) and Netflix (NFLX) shares. The latter was hit on a slightly disappointing next quarter revenue guidance and stopping to report subscriber count, while NVDA weakness was seemingly a continuation of the weak ASML earning report reaction earlier in the week, in addition to a collapse in Super Micro (SMCI) shares on a lack of upside pre-announcement also hit the chip space. Weakness was also observed on Friday morning as Israel retaliated against Iran which led to upside in Treasuries and oil, but the moves in the latter two assets had pared the majority of the move as it came to fruition not too much damage was dealt and neither side intend to retaliate again. The tech weakness kept stocks pressured, however. There was a lack of US data on Friday, but Fed’s Goolsbee sounded a bit more hawkish than his normal dovish self, noting progress on inflation has stalled, and it makes sense to wait for more clarity before moving. The Dollar was flat on Friday, but Sterling lagged on some dovish Ramsden commentary, who said the risks to UK inflation outlook are tilted to the downside vs February forecasts. There were also soft UK Retail Sales reported earlier in the session. Attention this week turns to a plethora of earnings, as well as US GDP and US PCE. The headline Philly Fed Business Index saw a strong beat rising to 15.1 from 3.2 (exp. 2.3) to show the highest print since April 2022, showing that Philadelphia manufacturing activity continued to expand. The upside in the headline coincided with a surge in Prices Paid to 23 from 3.7, the highest since December 2023 and near, but below, its long-run average while both price indexes continue to suggest overall price increases. New Orders also improved, rising to 12.2 from 5.4 while the employment component eased slightly to -10.7 from -9.6. CapEx eased to 20.0 from 23.6 while the outlook, the 6m index, eased to 34.3 from 38.6, showing firms continue to expect growth but at a slower rate. Note, there were special questions within the survey on wages and overall, responses indicate a median expected increase of 3-4% for wages and of 4-5% for total compensation (wages plus benefits), both unchanged from July. Existing Home Sales fell 4.3% in March to 4.19 million (prev. 4.38 million), more-or-less in line with the expected 4.2 million. Nonetheless, and as Oxford Economics points out, despite the fall, existing home sales posted a robust 8% increase in Q1 as buyers responded to lower mortgage rates and an increase in inventory. Looking ahead, OxEco baseline assumes a slight rise in home sales over the rest of 2024, but the risk to its forecast for sales is tilted to the downside, given the likelihood that the Fed does not start cutting interest rates until September. Elsewhere within the release, the supply of homes for sales, which is noisy month to month, posted its largest annual increase since last January. Meanwhile, Fed Member Williams speaking at an event, warned that if the data called for higher rates, the Fed would hike. However, he made a point of saying that is not his base case, reiterating that policy is in a good place, whilst saying he does not feel the urgency to cut rates, but they eventually will need to be reduced. Note these comments are slightly more hawkish in tone than some of Williams’ recent commentary, where he has put some focus on the upside risks to inflation/policy. Elsewhere, Oil closed 0.50% higher, while Gold ended flat, following a volatile trading session, that saw plenty of two-way price action.
To mark my 2975th 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 was made 570 points on Friday and is now ahead by 3107 points for April after ending March with a gain of 2113 points. February closed with a gain of 1606 points, after closing January with a gain of 3675 points. December saw a gain of 1890 points after finishing November with a gain of 1734 points. October ended with a gain of 3184 points, after closing September with a small gain of 228 points, after finishing August with a gain of 1485 points, 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 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 0.88% lower at a price of 4967.
The Dow Jones Industrial Average closed 211 points higher for a 0.56% gain at a price of 37,986.
The NASDAQ 100 closed 2.05% lower at a price of 17,037.
The Stoxx Europe 600 Index closed 0.08% lower.
This Morning, the MSCI Asia Pacific closed 0.8% higher.
This Morning, the Nikkei closed 1% higher at a price of 37,438.
Currencies
The Bloomberg Dollar Spot Index closed 0.03% lower.
The Euro closed 0.1% lower at $1.0655.
The British Pound closed 0.7% lower at 1.2372.
The Japanese Yen fell 0.3% closing at $154.65.
Bonds
Germany’s 10-year yield closed 4 basis points higher at 2.51%.
Britain’s 10-year yield closed 3 basis points lower at 4.23%.
U.S.10 Year Treasury closed 1 basis points higher at 4.62%.
Commodities
West Texas Intermediate crude closed 0.5% higher at $83.16 a barrel.
Gold closed 0.1% higher at $2391.10 an ounce.
This morning on the Economic Front we have no data of note. At 1.30 pm we have U.S. Chicago Fed National Activity Index. Finally, at 3.00 pm we have Euro-Zone Consumer Confidence.
Cash S&P 500
Friday’s market action was interesting to say the least. At one point during the day, the Dow Jones was up 327 points and the NYSE A/D ratio was a positive 5:1. At the same time the Dow was rallying, the NASDAQ 100 was down 330 points. The bifurcation was striking. By session’s end, the Dow closed higher by 211 points while the NYSE A/D ratio was a positive 2.16:1. Meanwhile, the NDX closed down 357 points while the S&P declined 44 points. The main culprit for the NDX’s stunning disparity was the dive in share prices of the Magic 7 stocks, specifically Netflix, Nvidia, Apple and Meta (Facebook). For the S&P Friday was the sixth consecutive down close, the longest losing streak since October 2022. In the process Friday’s 4954 low print closed the February 21 ‘’Open Gap’’ (4981/4991) while the S&P again closed outside the bottom of its Daily Bollinger Band. Something that I have never seen before is the last three down-days for the S&P came on positive internals as shown by the McClellan Oscillator which improved to close at -128 on Friday night. The Daily RSI is now as oversold as it was last October with price further outside the Bollinger Band compared to then. All this price action smells of a major bounce to come. I said in Thursday’s commentary if you buy the market at the close following an aggressive down-day you would make points in the overnight. This morning the S&P is trading 24 Handles higher at 4991. On Friday, my S&P plan worked well as the market traded the whole of my buy range for a 4992 average long position before rallying to my revised 5016 T/P level. Subsequently, I emailed my Platinum Members to buy the S&P again, and I am now long at 4998 with no stop. This morning, I will have a T/P level on this position at 5012. If this level is triggered, I will be back with a new update for my Platinum Members.
EUR/USD
On Friday, the Euro sold off to my 1.0630 buy level. I am still long with a now lower 1.0680 T/P level. I will add to this position at 1.0550 while leaving my 1.0495 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dollar Index
No Change: The Daily Sentiment Index for the Dollar closed at 91 for the third consecutive trading session which is a rare occurrence. last night. The DSI’s current extreme suggests that prices are nearing a short-term high. I am still short the Dollar at 106.05. I will add to this position at 106.85 while leaving my 107.35 ‘’Closing Stop’’ unchanged. Meanwhile I will leave my 105.60 T/P level unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash DAX
My DAX plan worked well as the market traded lower to my 17620-buy level before rallying to sit higher at 17840 this morning. As so many of my calls hit at the same time on Friday, I exited this long position at my revised 17690 T/P level and I am now flat. Today, I will again be a buyer of the DAX on any further drop lower to 17610/17710 with a higher 17515 ‘’Closing Stop’’. I still do not want to be short the market at this time. If this view changes, I will be back with a new update for my Platinum Members.
Cash FTSE
The FTSE traded the whole of my buy range for a 7790 average long position. I covered this position too early at my revised 7845 T/P level and I am still flat. This morning, the FTSE is trading higher at 7985. The fact that the FTSE is so strong is a hint that we may see at least a temporary bottom in the American Indexes. The FTSE has support from 7870/7940 where I will be a small buyer with a higher 7815 ‘’Closing Stop’’. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
My Dow plan worked well as the market traded the whole of my buy range for a 37500 average long position. With eight ‘’Open Positions’’ at the same time, I had to reduce some of my risk which I did by exiting this position to early at my revised 37650 T/P level and I am now flat. With the Dow trading at 38150 this morning, I wish I had held on to this trade instead of the NDX. (Hindsight) The Dow has resistance from 38350/38600 where I will be a small seller with a tight 38755 ‘’Closing Stop’’. As I am long both the S&P and NDX, I will not have a buy level in the Dow today.
Cash NASDAQ 100
The NDX closed over 2% lower on Friday, led by the 10% fall in Nvidia. This share has now fallen over 22% since its March high of $974. I added to my existing 17780 long position at 17460 for a now 17590 average long position. This was a foolish trade as I have no stop on this position, but we are nicely ahead for the month which gives me some flexibility. Having said that any rally to 17350 will see me exit this trade. If this view changes I will be back with a new update form my Platinum Members.
March BUND
The Bund rallied on Friday morning to my 132.05 T/P level on my latest 131.50 average long position. The Bund hit a high of 132.20 before spending the rest of the session selling off. This morning, the Bund is trading at 130.90. We have strong support from 129.80/130.60 where I will be an aggressive buyer with a lower 129.15 ‘’Closing Stop’’. Despite the negative price action, I still do not want to be short the Bund at this time.
Gold Rolling Contract
Gold fell shy of my sell range on Friday morning with a 2415 high print and I am still flat. I will now lower my sell level to 2412/2428 with a 2444 ‘’Closing Stop. If I am taken short, I will have a T/P level at 2397.
Silver Rolling Contract
This morning, Silver has finally traded lower to my 27.70 buy level. I will add to this position at 26.90 while leaving my 25.95 ‘’Closing Stop’’ unchanged. I will now lower my T/P level on this position to 28.30. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
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