U.S. Indices closed lower following the release of Federal Reserve Meeting Minutes which weighed on the market in the last hour of trading. Language suggested members of the rate-setting Federal Open Market Committee were less willing to provide interest-rate guidance. This worried investors as they thought this was a sign that the central bank was more pessimistic on the economic outlook. Earlier both the S&P and NASDAQ made new all-time highs before reversing to close lower by 0.44% and 0.71% respectively. Meanwhile, Congress appears to be heading back to the negotiating table. Speaker of the House Nancy Pelosi (D-CA) said her party would be willing to ease demands if Republicans were willing to do the same. Treasury Secretary Steven Mnuchin, who has negotiated previous deals with Pelosi, said he hopes to sit down with her when she returns to Washington, D.C. European Indices closed mixed with the DAX steady following the 1.25% fall in the Euro. Italian Prime Minister Giuseppe Conte said the government could present its Coronavirus-recovery plan as soon as mid-October. That could help boost the demand picture in the country as spending levels rise. Elsewhere, Gold fell another 4% on the stronger Dollar.
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For anyone following my Platinum Service it made 150 points yesterday and is now ahead by 1797 points for August having ended July with a gain of 3128 points, 2580 points in June, 2456 points in May, 4773 points in April, an incredible 9264 points in March, 2223 points in February and 2142 points in January. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
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Equities
The S&P 500 closed 0.44% lower at a price of 3375.
The Dow Jones Industrial Average fell 85 points for a 0.31% loss to close at 27,692.
The NASDAQ fell 0.71%, closing at 11,318.
The Stoxx Europe 600 Index rose 0.2%.
The MSCI Asia Pacific Index fell 0.2%.
This morning the Nikkei closed 1.0% lower at 22,880.
Currencies
The Bloomberg Dollar Spot Index increased 0.7%.
The Euro closed 1% lower at $1.1830.
The British Pound closed 1.2% lower at $1.3085.
The Japanese Yen closed 0.4% higher at 106.07 per dollar.
Bonds
The yield on 10-year Treasuries closed one basis point higher at 0.66%.
Germany’s 10-year yield fell one basis point to -0.48%.
Britain’s 10-year yield also closed one basis point higher at 0.23%.
Commodities
The Bloomberg Commodity Index fell 0.8%.
West Texas Intermediate closed 0.23% lower at $41.68 a barrel.
Gold closed 4% lower at $1,927.10 an ounce.
This morning on the Economic Front we already had the release of July PPI which rose 0.2% versus +0.1% expected. At 10.00 am we have Euro-Zone Construction Output and this is followed at 12.30 pm by the ECB Minutes from last month’s meeting. Finally, at 1.30 pm we have the Philly Fed Manufacturing Survey and the Weekly Jobless Claims.
September S&P 500
The S&P made a new all-time high yesterday but fell shy of my 3400 target level with a 3395.50 high print for the September S&P. The Cash S&P made a new high at 3399.54 before reversing into the close and again overnight to sit at 3355 as I go to press. There is no doubt that the S&P is due a meaningful correction. Technical conditions continue to deteriorate with negative divergence on many indicators. The CBOE Put/Call ratio continues to show extreme bullishness. This ratio has been below 80 every day for the past two weeks which I have never seen before. The large reversal in both the Euro and Gold yesterday may be a pointer for the US Indices over the coming days. On top of this the McClellan Oscillator is pointing to lower prices, closing with a negative 73 print last night. Late yesterday the S&P hit my 3367 buy level before rallying to my revised 3373 T/P level and I am now flat. The S&P has support from 3327/3342 where I will be a strong buyer with a 3312 stop. A break and close below 3320 this evening will be bearish opening up the possibility of a correction to at least the 3220/3250 support area. I will now lower my sell level to 3375/3393 with a 3408 stop.
EUR/USD
As it turns out I had too tight a T/P level on my 1.1935 latest short position with the Euro hitting my 1.1905 T/P level before falling to sit at 1.1835 this morning. The recent 10% appreciation for the Euro is a huge move in just three months. If stock markets have topped or are close to topping then we will see an aggressive move higher in the US Dollar over the coming weeks. Today I will be a seller from 1.1890/1.1940 with a tight 1.1985 stop. The Euro has short-term support from 1.1710/1.1760 and I will lower my buy level to this area with a 1.1665 stop.
September Dollar Index
Unfortunately, the Dollar just missed my 92.15 buy level before rallying to sit at 93.05 this morning. I will now raise my buy level to 92.10/92.60 with a 91.65 stop.
September DAX
The DAX again missed my sell range before trading sideways for most of yesterday’s session. This morning the DAX is trading 1.3% lower and I am still flat. I will now lower my buy range slightly to 12640/12710 with a lower 12585 stop. The DAX has strong resistance from 12960/13100 where I will be a small seller with a 13165 stop.
September FTSE
The 1.2% fall in Cable since I posted yesterday morning will support the FTSE. I am still flat and I will continue to be a buyer from 5940/5990 with the same 5895 stop.
Dow Rolling Contract
The Dow again fell shy of my 28010 sell level before selling off overnight to my 27520 buy level. I am still long and I will add to this position at 27350 with a now lower 27225 stop. I will lower my T/P level to 27630 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
September NASDAQ
It took a while and a new all-time high for the NASDAQ before the market sold off to my 11305 T/P level on Tuesday’s latest 11365 short position and I am still flat. The NASDAQ has now made over 32 new all-time highs this year and is severely overbought. The NASDAQ has resistance from 11340/11440 where I will be a seller with a 11515 stop. My only interest in buying the market is still from 10980/11080 with the same 10895 stop.
September BUND
I am still flat the Bund. I am not going to chase the market higher and I will leave my 175.70/176.20 buy level unchanged with the same 175.35 stop.
Gold Rolling Contract
Gold got crushed over $70 since I posted yesterday morning to hit an overnight low so far of 1923. Gold has strong support at the 2011 previous high of 1911 and this level should act as strong support. Today I will be a small buyer from 1900/1916 with a 1889 stop.
Silver Rolling Contract
I am still flat as Silver again just missed my buy range before rallying. Given how overbought Silver is trading I am not going to chase the market higher and I will leave my 25.50/26.20 buy range unchanged with the same 24.85 stop.
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