U.S. Indexes were heavily sold on Friday, concluding what has been a grim week for risk assets amid the start of the Middle East conflict. In addition to that, markets got a further hit on a quite dismal US jobs report, which saw the headline plunge 92k (exp. 59k, prev. 126k), unemployment rate tick higher to 4.4% (prev. & exp. 4.3%), and wages unwelcomingly accelerate/sticky. Further adding to the woes, and hitting the tech/semi sector, including Nvidia, were Bloomberg reports that Oracle and OpenAI end plans to expand data centre site. However, US indices pared some of this weakness as CNBC, citing a source, refuted this, saying existing plans remain on track. Adding more pressure, there were further private credit worries amid reports that BlackRock (BLK) limits withdrawals at a private credit fund as redemptions mount. All sectors, aside from Consumer Staples, were in the red given the aforementioned news. As has, of course, been the theme this week, the crude complex extended their record-breaking week of gains, with WTI and Brent higher by USD 25/bbl to last week’s Friday settlement. Attention firmly resides on the Middle East, and also the Strait of Hormuz, with participants looking out for any weekend breakthroughs, despite how unlikely it currently seems. The Dollar pared some of its extensive strength seen this week, as the US jobs report weighed, with the Canadian Dollar outperforming on surging oil prices. Treasuries chopped to surging energy prices and a weak NFP report, while private credit concerns linger, and precious metals finished in the green. There was plenty of Fed speak ahead of the blackout on Friday evening (more details below). Overall, the NFP Report was soft and raises questions about whether the labour market has truly stabilised. After a strong jobs report in January (+126k, revised from 130k), the economy lost 92k jobs in February, far below the +59k forecast. Two-month net revisions totaled -69k, largely concentrated in December (-65k), leaving December payrolls at -17k. January job growth remained solid at 126k (initially 130k), but the revisions place the start of the year at a lower employment base, with much of Januaryʼs strength fading in the initial February reading. The March jobs report, due on 3rd April, will include further revisions to both the strong January figure and the weak February data. Regarding job losses this month, healthcare employment fell by 28k, reflecting strike activity following a 77k increase in January. Employment in information and the federal government continued to trend down, with information employment -11k and federal government employment -10k. Social assistance rose by +9k, while transportation fell by -11k. Little change was reported across other major industries, including mining, quarrying, and oil and gas extraction; construction; manufacturing; wholesale trade; retail trade; financial activities; professional and business services; leisure and hospitality; and other services. Ahead of the data, ING highlighted: “A few are warning of a softer, possibly negative number based on the very cold weather in late January and early February. If so, the dollar could get hit briefly, but losses might not endure given the Middle East risk.” The Unemployment Rate rose to 4.4% from 4.3%, against expectations for another 4.3% reading, bringing it in line with the Federal Reserveʼs 2026 median projection, which is set to be updated on 18th March. Meanwhile, wages came in 0.1% higher than expected at 0.4% M/M and 3.8% Y/Y. For the Fed, the report may prompt Waller to vote for another 25bps cut in March – he said before the data that if Januaryʼs strength unwound in February, he might support another cut. Markets are still not pricing rate cuts until September amid uncertainty around the situation in the Middle East and its economic impact, and the Fed typically takes a wait-and-see approach during periods of uncertainty. Markets now price in about 44bps of easing in 2026 versus 38bps before the data. This fully prices in one rate cut, with a 76% probability of a second. Retail sales fell 0.2% in January (prev. 0.0%), albeit not as deep as the expected decline of 0.3%, while ex-gas/autos rose 0.3% (exp. 0.0%, prev. 0.1%, rev. from 0%) and ex-autos was unchanged at 0.0%, in line with expectations. Retail control group rose 0.3%, slightly above Wall St. consensus of 0.2%, with the prior revised to 0.0% from -0.1%. Spending fell, as consumer confidence was hit, highlighted within the report as foods services & drinking places, declined for the second consecutive month, while clothing & clothing accessories store spend also pulled back further. Potentially further weighing on the consumer were harsh cold weather conditions affecting some of the country in late Jan. Fed Member Waller said we are going to see a spike in gasoline prices, but from the Fed’s point of view, it is unlikely to cause sustained inflation and added that these energy costs are likely to be passed along like everything else. On the labour market, which is Waller’s main concern and speaking before the US jobs report, said it looked like in January might be turning a corner, but will find out today whether it was a signal or not. Of course, as seen from the dataset, it was not a turning corner and February’s. release was truly dismal. Waller reiterated if there is strength in the labour market, he would be willing to pare back his rate cut bets, but after the data on Friday that is exceedingly unlikely given how weak it was. Prior to the NFP release, remarked that if we get a bad jobs number, and January numbers revised down, why would they just sit on their hands?. Regarding the private credit market, the influential Governor does not see big or widespread problems and headlines they have seen do not seem to be systemic. Fed Member Miran is hesitant to read too much into one month’s job report and noted how policy is pretty mis calibrated from here. The forever dove reiterated that Monetary Policy is too tight and that the neutral rate is like 2.5-2.75%; hopes the Fed votes to cut at this month’s FOMC meeting, and he will be a dissenter if not. Miran echoed the fact that the Fed should cut rates to neutral, then re-estimate. He also added the Fed typically does not respond to oil prices, and if anything it biases him towards even more dovish policy, and that oil shock can weigh on core inflation by hurting demand. Fed Member Hammack sees no imminent need to change the stance of monetary policy in an economy where inflation is still “too high”. The Cleveland Fed President added that given the Fed’s need to balance “elevated” inflation and a “softening” job market, these factors, joined with rate cuts done last year, leave monetary policy “in a good position”. Under her base case, she thinks policy should be on hold for quite some time as they see evidence that inflation is coming down and the labour market stabilises further. Hammack noted that it’s easy to envision other scenarios, as well, so she sees two-sided risks to rates. Finally, Fed Member Daly said the latest jobs report has her attention, noting she hoped last year’s rate cuts would put a floor under the job market, but warned no single month of data should be decisive. She stressed both sides of the mandate carry risks, with the labour market appearing vulnerable. She suggested that if the breakeven rate is 30k, they are currently below that, but it is only a couple of months of data. She said she is concerned about the labour market but cites issues around strikes and poor weather. Regarding energy prices in wake of the Middle East conflict, she said the outlook depends on how long oil prices remain elevated, and the Fed does not want to act aggressively unless it knows that part. On the path ahead for rates, she said an alternative is to hold rates steady, but they are not in a position to think they should hike. “We have to be steady in the boat” whilst they collect more inflation. Elsewhere, Oil closed higher by a whopping 12% while Gold ended Friday’s session with 1.4% gain.
To mark my 3325th 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 lost 293 points on Friday and is still ahead by 2008 points for March 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 whe 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 1.33% lower at a price of 6740.
The Dow Jones Industrial Average closed 453 points lower for a 0.95% loss at a price of 47,501.
The NASDAQ 100 closed 1.51% lower at a price of 24,643.
The Stoxx Europe 600 Index closed 1.37% higher.
Last Friday, the MSCI Asia Pacific closed 0.4% higher.
Last Friday, the Nikkei closed 0.62% higher at a price of 55,620.
Currencies
The Bloomberg Dollar Spot Index closed 0.36% lower.
The Euro closed 0.12% higher at $1.1608.
The British Pound closed 0.29% higher at $1.3392.
The Japanese Yen fell 0.19% closing at $157.86.
Bonds
U.K.’s 10-Year Gilt closed 12 basis points higher at 4.57%.
Germany’s 10-Year Bund Yield closed 8 basis points higher at 2.86%
U.S.10 Year Treasury closed 5 basis points higher at 4.14%.
Commodities
West Texas Intermediate crude closed 11.86% higher at $90.62 a barrel.
Gold closed 1.41% higher at $5154.10 an ounce.
This morning on the Economic Front we have German, Euro-Zone and U.K. Construction PMI at 8.30 am, 8.35 am and 9.30 am respectively. Next, we have Euro-Zone Retail Sales at 10.00 am while the ECB will release the Minutes from last month’s meeting at 12.30 pm. This is followed by U.S. Weekly Jobless Claims, Non-Farm Productivity and Unit Labour Costs at 1.30 pm. At 3.00 pm we have Durable Goods Orders and Factory Orders. Finally, we have a speech from ECB President Lagarde at 5.00 pm and a speech from Fed Member Bowman at 1.15 pm.
Cash S&P 500
The S&P closed more than 1.25% lower on Friday as oil prices surged and the job’s report came in well below estimates. Oil climbed over $91 on Friday, and IG Weekend Oil is trading up almost 6%, indicating an opening around $95. Meanwhile, the weekend Nasdaq 100 proxy is trading lower by about 70 basis points. It is common to see Futures Markets’ on Sunday night open near the indicated weekend levels, which helps in understanding where and why future prices are moving higher or lower. An open around $95 for oil would place it at its next level of resistance and its highest price since September 2023. After $95, things in oil get more interesting because resistance levels thin out, and we could easily see oil surge into the $100 to $110 range. Even though oil is technically overextended, with an RSI over 70 and trading well above its upper Bollinger Band, technicals currently take a back seat as the commodity reprices in our new world environment. Of course, gasoline prices are also rising, and that becomes more significant given the current resistance at $2.60, followed by $2.81 and then $3.00. Rising gasoline and oil prices will not help the inflation outlook, and this week, inflation will be in focus, with both the February CPI and January PCE reports being released. For the most part, the CPI energy index simply follows the price of gasoline, so one can expect that while February energy data may not be affected much of the rise in oil and gasoline, March likely will. Gasoline alone has nearly a 3% weighting in the headline CPI report. Rising commodity prices are likely to put upward pressure on interest rates until the price is deemed too high and damaging to the economy. Once that happens, rates will no longer rise and will begin to fall. That, in my view, will be the market’s recession warning. In the end, high-yield credit trades like equity, so if high-yield credit continues to feel pressured due to rising oil and gasoline prices, it will be hard for stocks to hold their current levels, whether it is the S&P 500 or the Russell 2000. We will just have to wait to see where this ultimately goes and where oil and gasoline settle out; right now, it is just not entirely clear. Despite the S&P expected to open lower this evening I would not be chasing the market lower. The McClellan Oscillator closed at -183 on Friday and is now just one large down day from generating a buy signal. Meanwhile, the Fear & Greed Index closed at 27 and is even more oversold. More importantly, the S&P 500 on Friday closed for the first time below the 6,800 level. This has been a very important level because now that it has broken, it opens the path to lower levels and into the 6,700s. What is interesting is that 6,700 is currently the main area where there is lots of ‘’ Put Gamma’’ built up. Once you get past 6,700, the 6,600 and 6,500 strikes essentially neutralise each other — there is just as much gamma concentrated at 6,600 as at 6,500, and it is significantly less than what is at 6,700 right now. What this suggests is that once we break below 6,700, the market could start targeting the 6,500–6,600 level. Remember, the 200 Day Moving Average comes in at a price of 6583 and has not been tagged since last May. We are in a negative gamma regime, which means market makers are going to be selling and buying based on the direction of the market. Delta positioning has also gotten very light, so there is just not a lot of support from an options perspective at these levels. Technically, once you get below 6,720, there is a giant gap down around 6,600 that is still open from mid-November. On the Daily Chart you can also see 6,550 as another area of key support. Given the backdrop of these now oversold markets, I would expect whatever low is put in on Monday to be followed by a strong rally at least to the 6780/6810 key resistance area. After the S&P traded the whole of Thursday’s buy range for a 6802 long position we rallied to my revised 6815 T/P level. Subsequently, Friday’s aggressive sell-off has me long again at a price of 6771. I will add to this position at 6668 with a now lower 6643 ‘Closing Stop’. I will have no T/P level for now and if my next buy level at 6668 is triggered, I will be back with a new update for my Platinum Members.
EUR/USD
I am still long the Euro at an average rate of 1.1670 with the same 1.1695 T/P level. I will leave my ‘Closing Stop’ unchanged at 1.1575. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dollar Index
I am still flat. Today, I will again be a seller from 99.60/100.30 with the same 100.95 ‘Closing Stop’. If I am taken short, I will have a T/P level at 99.00.
Russell 2000
The Russell never came close to Thursday’s sell range before accelerating lower on Friday. The Russell has strong support below from 2390/2450 where I will be an aggressive buyer with a 2335 ‘Closing Stop’. If I am taken long, I will have a T/P level at 2525.
FTSE 100
My FTSE plan worked well as the market traded the whole of my buy range for a 10400 average long position before rallying to my revised 10460 T/P level and I am now flat. The FTSE has strong support below from 10040/10120 where I will be an aggressive buyer with a lower 9955 ‘Closing Stop’. If I am taken long, I will have a T/P level at 10230.
Dow Rolling Contract
Wrong! The Dow got hit hard on Friday, trading the whole of my buy range for a 48150 average long position before stopping me out of this trade below my 40795 stop at a price of 47595 and I am still flat. Today, I am going to stay flat as I prefer to be a buyer of the other Indexes given the volatility. If this view changes, I will be back with a new update for my Platinum Members.
Cash NASDAQ 100
After the NDX traded lower to my 24750 buy level we had a small rally to my revised 24822 T/P level and I am now flat. The NDX has strong support below from 24100/24300. This is where the 200-Day Moving Average (24200) comes in. I will be an aggressive buyer of any test of this area with a 23975 tight ‘Closing Stop’. If I am taken long, I will have a T/P level at 25590. If any of these views change, I will be back with a new update for my Platinum Members.
December BUND
I am still flat. On Friday, the Bund closed 140 points lower from where I marked prices on Thursday. I am going to stay flat today until I feel I have a better edge in this market. If this view changes, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
I am still flat. Gold has strong support below from 4650/4750 where I will be a strong buyer with a lower 4545 ‘Closing Stop’. If I am taken long, I will have a T/P level at 4920.
Silver Rolling Contract
No Change: Silver has now fallen over 20% from Monday’s high at 96.80. This is a huge move lower catching many long positions in the process. Today, I will continue to be a buyer from 73.50/76.00 with the same 71.95 ‘Closing Stop’. If I am taken long, I will have a T/P level at 79.35
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