U.S. equities edged lower as investors assessed corporate earnings and economic data. Treasuries joined a global rally in sovereign bonds and the US Dollar extended its rally to a four-month high. The S&P 500 Index slumped 0.2 percent from Tuesday’s record close. AT&T Inc. and Caterpillar Inc. fell after reporting first-quarter results, while Boeing Co. rose. The Euro sank to the lowest level in almost two years after key gauges of confidence in the EU’s two largest economies deteriorated. The Canadian Dollar fell to the weakest since January after the Bank of Canada abandoned its bias toward raising rates. U.S. Equities have been on a tear since late last year, but the fresh record Tuesday appears to have triggered a pause and some soul-searching among investors. Although about 80 percent of S&P 500 companies reporting results so far have exceeded estimates, some are starting to question whether the rally has legs. Positive earnings surprises in Europe, meanwhile, have done little to erase lingering concerns about the region’s economic outlook. Still ahead is U.S. First-Quarter Gross Domestic Product data due tomorrow afternoon.
To mark my 1825th 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@tradernoblecom for details
For anyone following my Platinum Service it made 43 points yesterday and is now ahead by 739 points for April, having made 1027 points in March, 1013 points in February, 1671 points in January, 2803 points in December, 1541 points in November and 2094 points in October. 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 Stoxx Europe 600 Index snapped its longest rally since 2017 closing 0.1% lower, the first retreat in two weeks. Asian stock gauges were mixed. In China, markets got little help from the central bank’s move to support liquidity in the banking system by injecting the equivalent of about $40 billion in medium-term loans. Policy makers have refrained from stronger measures, such as lowering benchmark lending rates, as an upturn in economic data reduces the pressure for more stimulus. The S&P 500 Index fell 0.2 percent at the close of trading in New York. The MSCI Asia Pacific Index fell 0.6 percent while the MSCI Emerging Market Index declined 0.7 percent.
Currencies
The Bloomberg Dollar Spot Index added 0.6 percent to close at a new four-month high. The Euro fell 0.6 percent to $1.1155, the weakest since June 2017, having made an intra-day low of 1.1140. Meanwhile the Japanese yen fell 0.3 percent to 112.21 per dollar, the weakest this year.
Bonds
The yield on 10-year Treasuries dipped four basis points to 2.52 percent. In Europe, Germany’s 10-year yield declined five basis points to -0.02 percent after another weak ZEW Survey. The UK Gilt also fell five basis points to close at 1.17% in London.
Commodities
The Bloomberg Commodity Index fell 0.3 percent. West Texas crude fell 0.9 percent to $65.73 a barrel, while Gold closed unchanged on low volume.
This morning on the Economic Front we have UK CBI Industrial Trends Survey at 11.00 am. This is followed by US Weekly Jobless Claims and Durable Goods Orders. Finally at 4.00 pm we have the Kansas Fed Manufacturing Survey Index.
June S&P 500
It took a while but finally the S&P traded lower to my 2930 T/P level on Tuesday’s 2933 short position and I am now flat. With Microsoft producing better than expected earnings after the close both the NASDAQ and S&P Futures Markets are trading higher as I go to press. While the S&P made a new closing high on Tuesday we have yet to take out last September’s all-time high of 2942. Today I will still be a seller on any further rally to 2945/2955 with a 2961 tight stop. Meanwhile I will raise my buy level to 2908/2917 with a 2899 stop.
EUR/USD
The Euro traded lower to my first buy level at 1.1170 before falling further to my second buy level at 1.1140 just before the New York close for a now average long position at 1.1155. I am still long and I will leave my stop unchanged at 1.1115. I have to respect the fact that we closed below the key 1.1175 previous support level and for this reason I will now lower my T/P level on this position to 1.1172. I will also be a small seller on any further rally to 1.1210/1.1250 with a tight 1.1290 stop. If I am taken short a second time I will have a T/P level at 1.1170.
June Dollar Index
After the Dollar traded higher to my 97.70 sell level I emailed my Platinum Members to exit this short position at my revised 97.62 T/P level and I am now flat. The Dollar closed at a new high for the year at 97.85 and given how severely overbought the market is trading I will again look to sell the market on any further rally to 98.20/98.60 with a 98.95 stop.
June DAX
Despite the weaker than expected ZEW Survey the DAX rallied to new highs for the year helped by the weaker Euro. The DAX is now trading near the top of my 12250/12400 key resistance area and remember a break and close over this level by close of business tomorrow will be bullish for the coming weeks. Today I will move my buy level higher to 12150/12230 with a 12095 stop.
June FTSE
Even though the Pound was weak yesterday the FTSE sold off. This is no surprise given the severely overbought condition of the market after a relentless move higher this year. I am still flat and I will now lower my sell level to 7470/7510 with a 7545 stop.
Dow Rolling Contract
I am still flat the Dow as the market had a slight sell-off into the close. The Dow has strong support from 26250/26400 and I will be a buyer on any dip to this area with a 26180 stop. Even though the Dow is overbought I am not going to chase this market lower and I will leave my 26950/27100 sell level unchanged with a 27190 stop.
June NASDAQ
Thankfully the NASDAQ had a small sell-off into the Chicago close which enabled me to cover my average Tuesday 7815 short position at my revised 7810 T/P level and I am now flat. Better than expected earnings from Microsoft after the bell saw the NASDAQ making new highs for year-to-date as I go to press. However back-to-back Daily Sentiment Readings of 93% warns of trouble ahead for this market. Today I will still be a seller on any further rally to 7890/7940 with a 7975 stop.
June BUND
Just like the Equity Markets it is difficult to be short the Bund as despite the insanely low yield we are seeing huge buying on dips in this market. Yesterday the Bund traded the whole of my sell range for a now average short position at 165.55. I am not comfortable in being short and I will leave my 166.05 stop unchanged. I will now raise my T/P level on this position to 165.45 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
Gold Rolling Contract
I am still flat Gold and I will now lower my buy level to 1251/1260 with a lower 1244 stop.
Silver Rolling Contract
No Change as I am still long the market at 14.98 with the same 15.05 T/P level and 14.55 stop. If any of the above levels are hit I will be back with a new update for my Platinum Members.
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