U.S. Indices ultimately closed mixed on Wednesday as the NASDAQ 100 was the one major index to close with gains and was largely buoyed by gains in the mega-cap names, and highlighted by Tech and Communication, two of the only sectors, as well as Health, in the green. Real Estate, Consumer Utilities, and Consumer Staples lagged as the latter was weighed on by weak General Mills guidance. For a change, Middle East updates cooled as the Israel/Iran ceasefire is seemingly holding, at least for now, although there have been some flare-ups between Iran-backed Houthis in Yemen and Israel. As such, WTI and Brent saw slight gains after two days of chunky losses. Trump in his NATO press conference said he would talk to Iran next week, may sign an agreement, and would ask for no nuclear, while he threatened to double tariffs on Spain over NATO spending. The Dollar was weaker as the haven-allure subsided, to the benefit of G10 FX (ex JPY, NOK). Treasuries were more-or-less flat in quiet trade despite an average US 5-year auction. There was a lack of tier 1 US data on Wednesday, ahead of a deluge of data on Thursday. Powell gave his second day of testimony, this time to the Senate, and largely echoed his comments from yesterday. Schmid and Collins, both 2025 voters, hit the wires and sit on the same side as Powell and the majority of FOMC committee members, continuing to leave Waller and Bowman as the dovish outliers in flaunting a July cut. Lastly, the Fed proposes changes to ease ESLR for large banks, but governors Barr, and Kugler are opposed to the proposed changes. Fed Member Schmid said the central bank has time to study tariff effects on inflation before any rate decision and the resilience of the economy means the Fed has time to wait and see what happens before rate cuts. As such, Schmid joins the Powell approach, and numerous other Fed Committee members since the meeting (Hammack, Williams, Kashkari, Collins, Barr), continuing to leave Waller and Bowman as the dovish outliers. Meanwhile, Collins said monetary policy is well positioned and appropriate to lower rates later in the year, much depends on tariffs. Collins sees core PCE inflation above 3% by year-end due to tariffs and expects to resume policy normalisation later this year. New home sales fell to 623k in May from 722k, beneath the expected 693k. Within the release, homes for sale in end-May were 9.8 months’ worth (prev. 8.3). Oxford Economics notes that while builder incentives may prevent an even steeper decline in the headline, they see no real upside for sales in the months ahead given their forecast for mortgage rates to remain elevated and the labour market to soften. As such, OxEco says weak home sales in May and downward revisions to prior months underscore its outlook. Elsewhere, both Oil and Gold registered small gains for Wednesday, closing higher by 1.13% and 0.25% respectively.
To mark my 3200th 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 60 points yesterday and is now ahead by 4410 points for June, 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 0.01% higher at a price of 6092.
The Dow Jones Industrial Average closed 105 points lower for a 0.25% loss at a price of 42,983.
The NASDAQ 100 closed 0.21% higher at a price of 22,237.
The Stoxx Europe 600 Index closed 0.75% lower.
This Morning, the MSCI Asia Pacific closed 0.6% higher.
This Morning, the Nikkei closed 1.47% higher at a price of 39,514.
Currencies
The Bloomberg Dollar Spot Index closed 0.21% lower.
The Euro closed 0.25% higher at $1.1665.
The British Pound closed 0.29% higher at $1.3669.
The Japanese Yen fell 0.18% closing at $145.14.
Bonds
U.K.’s 10-Year Gilt closed 1 basis points higher at 4.49%.
Germany’s 10-Year Bund Yield closed 2 basis points higher at 2.56%
U.S.10 Year Treasury closed 3 basis points higher at 4.32%.
Commodities
West Texas Intermediate crude closed 1.13% higher at $65.10 a barrel.
Gold closed 0.25% higher at $3332.10 an ounce.
Today on the Economic Front we have speeches from Central Members Breeden (BoE), De Guindos (ECB), Bailey (BoE) Schnabel (ECB), Barkin (Fed) and Barr (Fed) at 9.30 am, 10.45 am, 12.00 pm, 12.05 pm, 1.45 pm and 6.15 pm respectively. Next, we have U.S. Weekly Jobless Claims and Wholesale Inventories at 1.30 pm. This is followed by Pending Home Sales at 3.00 pm and the Kansas City Fed Manufacturing Index at 4.00 pm. Finally, we have a Seven-Year Treasury Auction at 6.00 pm.
Cash S&P 500
Volume in the S&P 500 futures has completely vanished over the last couple of days, with contract counts declining each session. The rising wedge pattern did not work out, despite several attempts that brought us close. Unfortunately, close is not good enough. I do not think anyone needs me to say that the possibility of the market reaching a new high is a given; I have said that many times when we got over 5,800. However, I am skeptical about this, as market dynamics today are not what they were in 2020 or 2022/23. There is not much that can snap the market out of this malaise until we get new commentary on tariffs or some economic data that changes the narrative. As I noted yesterday, with implied volatility at 17 and realised volatility below 12, it will be challenging to see the market move in anything but a tedious grind, similar to what we experienced in the days leading up to the recent push higher, which was only able to occur because the VIX spike to 21. Adding to the mix is the fact we have negative divergence and an unprecedented nine ‘Open Gap’s below the market since the April lows which frankly is ridiculous as we know that eventually all these gaps will be filled. In some ways, the current environment reminds me a lot of early 2018. The NASDAQ dropped about 15% in January 2018, followed by a full recovery and new highs, only to give it all back again shortly afterward. I am not exactly sure why it feels reminiscent, but it does. However, just because something reminds us of the past does not mean it is a roadmap for the future. Meanwhile, as we know, this market is only as strong as Nvidia. The biggest issue right now is that Nvidia is officially overbought, trading above its upper Bollinger Band with an RSI approaching 74. Of course, it could become even more overbought, but it is already pushing the limits at this point, closing at new all-time highs above $154 per share. Meanwhile, repo market rates rose yesterday as the Quarter-End approaches. The trade-weighted average repo rate reached 4.41%, and I would expect this afternoon’s SOFR to rise above Wednesday’s 4.3%. Typically, as we head into quarter-end, overnight funding markets tighten, which drains liquidity from the market. I am still short the S&P at an average rate of 6065. I will leave my 6101 tight ‘Closing Stop’ unchanged while raising my T/P level on this position to 6060. If I am stopped out of this position I will look to sell the market again from 6130/6150 with a 6171 wider ‘Closing Stop’. If I am taken short a second time, I will have a T/P level at 6102. If any of these views change, I will be back with a new update for my Platinum Members.
EUR/USD
Wrong! Just before the New York close I was stopped out of my 1.1575 average short position at 1.1665 and I am now flat. This move higher saw the EURO close at its highest level since 2011 helping the Daily Futures Index to close above an unstainable 90. It is amazing that despite a combination of lower Treasury Yields and a stock market that is close to all-time highs that the Euro is trading 11% higher year-to-date. The weaker Dollar is either a warning sign that markets are going to re-test the lows or else it will finally turn around and rally hard to catch up with the equity markets. TBD. Just over two weeks to the July 9 deadline and still we have no new tariff announcements. The Euro has further resistance from 1.1720/1.1800 where I will again be a seller with a higher 1.1865 ‘Closing Stop’. If I am taken short, I will have a T/P level at 1.1630.
Dollar Index
The Dollar continues to trade near the lows of 2025. When I look at the Monthly Chart it shows a rare six consecutive months lower if we close near here by Monday. The Dollar remains at a critical technical juncture and confidence remains utterly lacking hence what happens with tariffs following the tax cut bill is so key. Get these tariffs reduced and the Dollar can rally hard with improved confidence is my opinion. I am still long the Dollar at 97.80 with the same 98.50 T/P level. I will add to this position on any further move lower to 97.00 while leaving my 96.35 ‘Closing Stop’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Russell 2000
I am still flat and I will not chase the Russell higher from here as I continue to be a buyer on any dip lower to 2040/2120 with the same 1985 ‘Closing Stop’. If I am taken long, I will have a T/P level at 2170.
FTSE 100
The FTSE continues to trade sideways/heavy with little upside momentum. I am still flat. Today, I will again lower my sell level to 8780/8860 with a lower 8935 ‘Closing Stop’. If I am taken short, I will have a T/P level at 8710.
Dow Rolling Contract
I am still flat the Dow as the market never came close to Wednesday’s sell range, by trading heavy all-day. Today, I will continue to be a seller from 43320/43570 with the same 43705 tight ‘Closing Stop’. Despite the positive price action I no longer want to be long the Dow at this time. Remember we still have no new trade deals announced as we quickly move forward to the July 9th deadline. If I am taken short, I will have a T/P level at 43140.
Cash NASDAQ 100
I am still short the NDX at an average rate of 22060 with a now higher 22030 T/P level. I will leave my 21305 ‘Closing Stop’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
December BUND
The Bund missed my 130.30 initial buy level by just one point and I am still flat. The Bund is trading at 130.72 this morning. Today, I will continue to be a small buyer on any further move lower to 129.50/130.30 with the same 128.75 ‘Closing Stop’. If I am taken long, I will have a T/P level at 130.90. I still do not want to be short the Bund at this time. If this view changes, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
No Change: Gold has support below from 3240/3260 where I will be a small buyer with a 3225 ‘Closing Stop’. I will continue to be a seller on any further rally to 3420/3440 with the same 3461 ‘Closing Stop’. If I am taken long, I will have a T/P level at 3287. If I am taken short, I will have a T/P level at 3397.
Silver Rolling Contract
Late in Wednesday’s session, Silver traded higher to my 36.10 T/P level on my latest 35.80 average long position and I am now flat. Silver has support below from 33.80/34.80. As I do not want to chase the market higher this is the only level that I will be comfortable in buying Silver. We have had a nice run in this market over the past three years so from here patience will now be the key. If I am taken long, I will have a T/P level at 35.60.
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