U.S. Equity Markets closed lower on Friday with the majority of losses occurring in the US afternoon on likely profit taking into the weekend after President Trump’s first week in office which saw the S&P 500 hit a fresh record high earlier in the week. Underperformance was observed in the NASDAQ 1 with weakness in Semi-Conductors after a soft Texas Instruments (TXN) guide, with the sector continuing to be hit after disappointing SK Hynix guidance on Thursday; NIVIDA closed -3% on Friday. Meanwhile, Meta (META) was ultimately bid despite initial selling after CEO Zuckerberg heavily raised CapEx guidance for the year with a focus on AI. Elsewhere, T-Notes settled roughly flat with marginal upside with T-Notes chopping to remarks from US President Trump and economic data. Upside was observed after the President softened his tariff stance overnight on China, noting he would rather not use tariffs on China and alluded to making a deal with China. However, European PMI data was generally better than expected which saw T-Notes move lower before disappointing US PMI’s reignited the bid, supported by revisions lower to the Jan University of Michigan Consumer Sentiment survey. The Dollar tumbled in response to the Trump remarks with further pressure added after the PMI data, while the Japanese Yen was flat versus the softer Dollar despite the Bank of Japan rate hike early Friday morning to 0.5% which is the highest rate in 17 years (as expected). The Yen chopped to remarks from BoJ Governor Ueda in the press conference, seeing gains around commentary on strong wage data and weakness around comments that there is no clear policy path for future adjustments. Elsewhere, oil settled flat with earlier upside supported by the weaker Dollar before selling was observed at the cash open, although there is focus on the impact of a fire at Iraq’s giant Rumaila oilfield, which caused a temporary 300k BPD hit to production and sources via S&P Global suggest it could last for days. Gold prices continued to trend higher, as did Silver, both supported by the weaker Dollar. Existing home sales rose 2.2% in December to 4.24 million (prev. 4.15 million), above the expected 4.19 million. Inside the report, median existing-home sale price jumped 6% Y/Y to USD 404,400, the biggest Y/Y gain seen since October 2022, while inventory of unsold existing homes fell 13.5% M/M, that is, 3.3 months’ supply at the current monthly sales pace. NAR Chief Economist Yun said “The median home price was elevated partly due to the upper-end market’s relative better performance, and sales rose by 35% from a year ago for homes priced above $1 million, while sales fell for homes priced under $250,000.” Ahead, Oxford Economics current baseline looks for existing home sales in 2025 to be roughly in line with the Q4 pace, but thinks “the risk may be for a slightly stronger pace of sales, particularly if mortgage rates decline modestly as we expect.” The Final University of Michigan Consumer Sentiment Survey for January saw the headline revised down to 71.1 from 73.2, despite expectations for it to be left unchanged. The drop was primarily led by the current conditions index which fell to 74.0 from 77.9, while forward looking expectations eased to 69.3 from 70.2. The inflation expectations were unchanged from the preliminary for the 1 year at 3.3% with the 5 year being revised down to 3.2% from 3.3%. Note, the UoM survey is extremely sensitive to political changes as it judges overall sentiment for democrats and republicans. Bloomberg’s Authers highlighted that “Michigan asks respondents for their party identification… 1 year inflation expectations among Republicans were higher than for Democrats throughout the Biden administration – that has all changed; Democrats are suddenly braced for 4% inflation, while Republicans say prices will rise by only 0.1%.” The report highlighted that “Concerns over the future trajectory of inflation were visible throughout the interviews and were tied to beliefs about anticipated policies like tariffs. Consumers continued to spontaneously express motives for buying-in-advance to avoid future price increases, and robust auto and retail sales data suggest that consumers are indeed acting on these views.” Elsewhere, Oil closed flat, while Gold ended Friday with a gain of 0.7% helped by the weaker Dollar
To mark my 3125th issue of TraderNoble Daily Commentary I am offering a special 2-Year rate of Euro 2750 for my Platinum Service which includes 1 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 lost 90 points on Friday and is now ahead by 1904 points for January after closing December with a gain of 1997 points after closing November with a gain of 3049 points having finished October with a gain of 2179 points. September saw a gain of 4402 points following a 301-point loss for August after closing July with a gain of 1918 points while June closed with a gain of 2074 points, having made 1843 points in May. The Platinum Service made 4010 points in 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 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 0.29% lower at a price of 6101.
The Dow Jones Industrial Average closed 140 points lower for a 0.32% loss at a price of 44,424.
The NASDAQ 100 closed 0.58% lower at a price of 21,774.
The Stoxx Europe 600 Index closed 0.05% lower.
Last Friday, the MSCI Asia Pacific closed 0.9% higher.
Last Friday, the Nikkei closed 0.06% lower at a price of 39,931.
Currencies
The Bloomberg Dollar Spot Index closed 0.57% lower.
The Euro closed 0.7% higher at $1.0495.
The British Pound closed 1.01% higher at 1.2481.
The Japanese Yen rose 2% closing at $155.79.
Bonds
Germany’s 10-year yield closed 5 basis points higher 2.58%.
Britain’s 10-year yield closed 1 basis points higher at 4.65%.
U.S.10 Year Treasury closed 1 basis points higher at 4.62%.
Commodities
West Texas Intermediate crude closed 0.1% lower at $74.86 a barrel.
Gold closed 0.7% higher at $2774 an ounce.
This morning on the Economic Front we have the German IFO Survey at 9.00 am. Next, we have U.S. Building Permits at 1.00 pm and the Chicago Fed National Activity Index at 1.30 pm. This is followed by New Home Sales at 3.00 pm and the Dallas Fed National Activity Index at 3.30 pm. Finally, we have a five-year Treasury Auction at 6.00 pm.
Cash S&P 500
Wrong! The S&P surged on Thursday, driven by comments from President Trump demanding that the ‘’Fed drop interest rates immediately’’ and that ‘’he expects the Fed to listen to him on interest rates’’. This is where the vibe of 2018/2019 is coming back as Fed Chair Powell famously flip flopped after Trump berated him on rates. Same players, same script, hence déjà vu. And so, this week’s Fed Meeting has now instantly morphed into a referendum on Fed Independence. If they cut, they look they have carved into to Trump’s bullying, if they do not then Powell may find himself under vast political pressure and perhaps eventually out of a job. The end result was new all-time highs. This move higher saw my revised 6110 ‘’Stop’’ triggered on my 6058 average short position and I am still flat. I remain of the view that we see larger corrective moves this year, but I also expect the Fed to intervene every step of the way as they have done since the October 22 lows. Markets have become a political tool to shape perception of success, but also a necessity to keep the popped up for the beast has become so large a proper re-sizing would be an absolute calamity to the U.S. Economy. I do not know how this ends but again the cringe factor is screaming as with each new high, the internal picture gets weaker and weaker. New all-time highs and barely half the components above their 50-Day Moving Average as we leave one large ‘’Open Gap’’ from another below. This is the most overvalued market in history as shown by the GAAP P/E printing a reading at 30.55. Even a 20% correction with an implied 24.5 multiple would still be on the high end. This is how far markets have levitated above historic norms. The S&P is again above the top of its Daily Bollinger Band, has resistance from 6117/6137 where I will again be a seller with a higher 6153 ‘’Closing Stop’’. Given how overbought the S&P is trading, I would prefer to wait for even a mild correction to set up a long position. If this view changes, I will be back with a new update for my Platinum Members. If I am taken short, I will have a T/P level at 6101.
EUR/USD
Frustrating as the Euro missed Thursday’s buy range by 10 points before surging on Friday, to a new recovery high at 1.0521. The Euro has support below from 1.0380/1.0440. I will move my buy level to this area with a higher 1.0315 ‘’Closing Stop’’.
Dollar Index
The Dollar is trading 1.5% lower from where I marked prices last week. The Dollar has support from 105.80/106.50. I will be a strong buyer on any dip to this area with a 104.95 wider ‘’Closing Stop’’. I no longer want to be short the Dollar at this time.
Russell 2000
The Russell 2000 continues to find strong resistance at its 50-Day Moving Average which comes in at price of 2297 this morning. I am still flat as the market never came close to Thursday’s buy range. Ahead of the FOMC Meeting on Wednesday, I will now lower my Russell buy level to 2130/2210 while leaving my 2075 ‘’Closing Stop’’ unchanged. If I am taken long I will have a T/P level at 2260.
Cash FTSE
My FTSE plan worked well as the market rallied to my 8570-sell level before trading lower to my 8510 T/P level and I am now flat. Today, I will again be a seller on any further rally to 8540/8600 with a lower 8655 ‘’Closing Stop’’. I still do not want to be long the FTSE at this time. If this view changes, I will be back with a new update for my Platinum Members.
Dow Rolling Contract
The Dow traded higher to my sell range on Thursday for a 44500 short position before selling off to my revised 44340 T/P level just before Friday’s close and I am now flat. Given how overbought the Dow is trading I will continue to be a seller of rallies even though it is the FOMC Meeting on Wednesday. The Dow has resistance from 44520/44780 where I will again be a seller with a 45005 higher ‘’Closing Stop’’. Ahead of the FOMC Meeting I no longer want to be long the Dow at this time. If I am taken short, I will have a T/P level at 44330.
Cash NASDAQ 100
My latest short NDX position worked well as the market sold off to my revised 21740. Subsequently, I emailed my Platinum Members to go short the NDX again at a price of 21910. This short position worked well as the market sold off to my 21780 T/P level and I am now flat. The NDX has further resistance from 21890/22040. I will be a seller in this range with a higher 22205 ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 21770. I still do not want to be long the NDX at this time.
March BUND
The Bund finally sold off to my buy range for a now 131.10 long position. I will continue to look to add to this position on any further move lower to 130.40 while leaving my 129.65 ‘’Closing Stop’’ unchanged. I will now lower my T/P level to 131.75. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
No Change: Gold continues to build value above 2650, and I am still flat. Gold has support from 2655/2670. I will leave my buy level unchanged with the same 2639 ‘’Closing Stop’’ as I am back long Silver again. If I am taken long, I will have a T/P level at 2684
Silver Rolling Contract
As mentioned above, Silver hit my buy range on Thursday for a now 30.40 long position. I will add to this position at 29.60 while leaving my 28.95 ‘’Closing Stop’’ unchanged. I will now lower my T/P level to 31.10. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
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