After the New York close last night the New Zealand Central Bank was the latest CB to cut Interest Rates when it announced a 25 basis point cut to its OCR Rate in an attempt to weaken the New Zealand Dollar. However this rate cut was 100% priced in and as I go to press the NZD has predictably bounced sharply, up just over 1%. Otherwise yesterday was a non-event as the Summer markets really kicked in with trading desks severely under-manned with most traders on holiday.
To mark my 1150th issue of Tradernoble Daily Commentary I am offering a special 2 year rate of Euro 2500 for my Platinum Service which includes 1/4 updated emails throughout the trading day. This offer is open to both new and existing members and if anyone is interested please email me on bryan@tradernoble.com for details.
For anyone following my Platinum Service it made 25 points yesterday and is now ahead by 325 points for August having made 1682 points in July. The previous three months saw gains of 2550, 1532 and 2175 points respectively. Since I started this Platinum Service in June 2015 it has averaged a monthly gain of over 2100 points.
The common denominator to ongoing across-the-board US Dollar weakness which was led yesterday by the Norwegian Kroner after an unexpected surge in inflation, prompting Norges Bank any thoughts of a September rate cut off the table. The Dollar continued to sell-off after yesterday’s reported fall in Q2 Labour Productivity and what if accurate implies for trend growth. Hence the Fed 2 year Treasury Yields are off another 3 bps to sit over 5bp lower than their post-July Payroll High print, while 10 Treasuries are down 4 bps after the latest 10-Year Note Auction met solid demand.
The main item dragging US equity prices lower is energy, with oil prices as much as $1.30 lower after the EIA reported Crude Inventories up by one million barrels last week against an expected draw of 1.5 million barrels.
The only piece of economic data of note yesterday was the US June JOLTS Job Openings Report which bounced back to 5.642mm from 5.514mm in May, a touch below expectations but still representing a very high level of openings.
Meanwhile RBA Governor Stephens yesterday delivered his last speech as Governor, ahead of stepping down from his post next month. It was as one would expect a wide ranging speech, that included a now familiar cry that governments should be prepared to borrow more for the right investment assets, but not generally to meet recurrent spending. The Australian Dollar continued to rally after his speech.
This morning we have no economic data from either the Euro-Zone or UK with as mentioned above most people away on vacation. At 1.30 pm we have the US Weekly Jobless Claims and the Import Price Index. Finally at 3.00 pm we have the US Bloomberg Consumer Comfort Index.
September S&P 500
On what was another very quiet US trading session the S&P finally hit my 2171 buy level before having a small bounce to 2174. I subsequently emailed my Platinum Members to exit this position at 2173.50 and take a small gain as we try to make up the small loss incurred on Tuesday when the DAX spiked to the upside. As mentioned in my email to my Platinum Members another reason that I cut this position was despite the fact that both the S&P and NASDAQ have made new highs over the past week the McClellan Oscillator closed negative on Tuesday. The S&P still has a large ‘Open Gap’ from last Friday’s Chicago low at 2163 to Thursday’s close at 2151 and today I will again be a buyer on any dip lower to 2161/2167 with a 2156 stop. My only interest in selling this market is still on a rally higher to 2187/2193 with a 2197 stop.
EUR/USD
The Euro just missed my 1.1110buy level after I posted yesterday before trading higher on the higher US Bond prices, which I mentioned earlier in the week in my opinion there is very little chance that despite the strong NFP data last Friday that the Fed will hike rates especially ahead of the Presidential Election in November. Today I will now raise my buy level to 1.1110/1.1150 with a 1.1065 stop. I still do not want to be short the Euro at this time. Remember a break and close over 1.1240 will be at least short-term bullish, opening up a move to at least the 1.13/1.1400 resistance level.
September Dollar Index
No change as I am still a seller on any rally higher to 96.10/96.50 with a 96.80 stop.
September DAX
The DAX traded sideways yesterday after its huge 250 point rally on Tuesday and I am still flat. The DAX is extremely overbought with the market trading at the top of its Williams Index and Daily Bollinger Band but until we see a sell extreme it is very difficult to be short. However the stronger Euro should slow the DAX advance from here and for these reasons I will now lower my sell level slightly to 10730/10780 with a 10820 stop which is just above the next key resistance at 10770/10800.
September FTSE
Unfortunately the FTSE just missed my 6825 sell level before selling off and I am still flat. Today I will again look to sell the FTSE on any rally higher to 6840/6870 with a 6905 stop. I will still look to buy the FTSE on any dip lower to 6710/6740 with a 6670 wider stop.
Dow Rolling Contract
The Dow continues to trade heavy as the market still shy’s away from its July all-time high at 18622. However despite the Dow trading heavy the volume on this recent sell-off in the Dow has been very low and I would therefore expect the market to sub-divide higher. Today I will now look to buy the Dow on any further dip lower to 18380/18440 with 18330 stop. I do not want to be short the market at this time as I still expect the Dow to take out its July high first before subsequently trading lower.
September BUND
Thankfully we have not been short the Bund which continues to trade higher despite the negative yield. I have no idea when this party will end but the price action continues to be positive. Today I will now raise my buy level to 167.10/167.45 with a 166.75 tight stop.
Gold Rolling Contract
I am still flat Gold and today I will leave my buy level unchanged at 1318/1326 with the same 1308 stop as I refuse to chase this market higher.
Silver Rolling Contract
There is no doubt that as long as Silver can hold its now important support at 19.20 then the market is a buy on dips. For this reason I will now raise my buy level slightly to 19.50/19.95 with a 19.05 tight stop.
For any of my UK members who may be interested I am doing a special all-day trading seminar over the Non-Farm Payrolls in London on September 2nd 2016. I will be assisted by Paul Wallace who is a trader that I have done a lot of joint presentations in both Dublin and London over the past 12 months. Paul is a very engaging and interesting speaker and together we will try and take you through how to trade markets live over an important economic indicator. If anyone is interested in this not to be missed event in my opinion you can check the details out on the following link:
https://summer2016londonlivetradingday.eventbrite.com
Recent Comments