U.S. stocks rose as renewed signs of easing trade tensions diverted attention from the swirling impeachment drama in Washington. The US Dollar rallied the most since March. The S&P 500 halted a three-day slide, with tech and bank shares pacing the gain. Equities rattled by the political turmoil in America turned higher after President Donald Trump suggested a trade deal with China was possible and then moved toward a pact with Japan. The advance recouped most of Tuesday’s drop sparked by the start of a formal impeachment inquiry of Trump. The impeachment push added a fresh element of risk into markets already on edge over trade and signs of slowing global growth, but trade has reliably been the biggest determinant of asset moves, and Trump’s conciliatory comments toward China helped ease some angst over the political upheaval. In the U.K. Boris Johnson sparked uproar during angry exchanges in the House of Commons after he was dragged back to Parliament to explain why he broke the law and tried to suspend the legislature in the run-up to Brexit. The defiant premier refused to resign or even apologise. Instead, Johnson came out fighting. He challenged his political opponents to trigger an election through a no-confidence vote, and accused them of cowardice for twice rejecting one. He also declared that the Supreme Court judges who overturned his decision to suspend Parliament were simply “wrong.”
To mark my 1900th 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 made 175 points yesterday and is now ahead by 1326 points for September, having made 2387 points in August, 1153 points in July, 1346 points in June,1722 points in May, 955 points in April and 1027 points in March. 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
Markets are way more interested in a trade deal with China. Now that the Congress is deadlocked into impeachment, the president can close a deal with China to boost the global economy into 2020, just in time for ballots to be cast. In company news, Philip Morris and Altria both advanced after ending merger talks, while Marathon surged on activist intervention. Nike Inc. rose to a record after strong results. Financials paced gains as Treasury yields turned higher.
The S&P 500 Index rose 0.6% to close at 2985 having traded as low as 2952 earlier in the afternoon
The Nasdaq 100 Index added 1.2%.
In Europe, the mood was more dour. Equities slumped amid rising concern that growth is flagging. U.K. shares fell as parliament reconvened amid Brexit turmoil. Asian benchmarks retreated, with losses of more than 1% in Hong Kong, South Korea, mainland China and India.
The Stoxx Europe 600 Index fell 0.6%.
Switzerland’s SMI Index dropped 1.2%.
The MSCI Asia Pacific Index sank 0.7%.
Currencies
Here is a summary of the main Changes in F.X. Markets:
The Bloomberg Dollar Spot Index jumped 0.6%.
The British Pound sank 1.1% to $1.235.
The Euro fell 0.7% to $1.0942.
The Japanese Yen weakened 0.7% to 107.82 per dollar.
Bonds
The yield on 10-year Treasuries increased eight basis points to 1.73%.
The yield on two-year Treasuries rose five basis points to 1.68%.
Britain’s 10-year yield declined two basis points to 0.509%.
Japan’s 10-year yield fell two basis points to -0.255%.
Commodities
Crude futures declined after Saudi Aramco said it was ahead of schedule in restoring output.
West Texas Intermediate crude sank 1.3% to $56.53 a barrel.
The Bloomberg Commodity Index declined 0.8%.
Gold Futures tumbled 1.9% to $1,510.60 an ounce.
This morning on the Economic Front we already had the release of the German GFK Consumer Confidence which came in higher than expected with a 9.9 print. At 9.00 am we have the Euro-Zone Economic Bulletin. This is followed at 1.30 pm by U.S. GDP, Trade Balance, Wholesale Inventories, PCE and the Weekly Jobless Claims. Next at 2.30 pm we have a speech by ECB President Dragi. At 3.00 pm we have Pending Home Sales and a speech by Fed Member Bullard. Finally, we have the Kansas Fed Manufacturing Index at 4.00 pm and the Trump Press Conference at 9.00 pm.
December S&P 500
No matter how bad the news is the S&P will not stay low for long as the S&P having hit my 2954 buy level, turned around and rallied 35 Handles into the close. This move higher saw my 2962 T/P level get executed and I am still flat. I said yesterday that any initial test of the 50 Day Moving Average would be met by strong buying and that is exactly what happened as yet again short positions were slammed. Today I will again look to buy the S&P on any dip lower to 2958/2970 with a 2949 stop. I still do not want to be short the market at this time.
EUR/USD
The 0.6% rise in the Dollar saw the Euro trade lower to my 1.0955 buy level. I am still long and I will add to this position on any further move lower to 1.0910 with a 1.0870 stop. I will now lower my T/P level on this position to 1.0975 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
December Dollar Index
The rally in the Dollar saw the Dollar hit my sell level at 98.70. I am still short with a now lower 99.15 stop.
December DAX
Shortly after I posted the DAX traded lower to my 12140 buy level before rallying to my revised 12160 T/P level and I am now flat. This morning the DAX is trading higher at 12230 as so far the key 12080/12140 support area is holding. Today I will again be a buyer on any dip to this area with a 12035 tight stop.
December FTSE
It took a while but finally the FTSE traded higher to my 7245 T/P level on my 7225 long position and I am now flat. I was surprised how weak the FTSE was yesterday given the big sell-off in the Pound. If this continues it will be a major change in the trend that prevailed over the past three years since Brexit when a weak Pound led to a rally in equities. Today I will again look to buy the FTSE on any dip lower to 7170/7210 with a 7135 tight stop.
Dow Rolling Contract
Unfortunately the Dow just missed my 2668 buy level with a 26730 low print before rallying back above 27000 and I am still flat. Despite the upside reversal in the US Indices the McClellan Oscillator still closed in negative territory with a -11 print. I would have expected that given the scale of yesterday’s move higher that the MO would have closed positive and this is definitely one to keep an eye on. In contrast the VIX closed 6% lower at 15.96 and is now back below the key 50 and 200 Day Moving Averages. Today I will move my buy level higher to 26630/26780 with a 26540 stop. Just like the S&P above I still do not want to be short the Dow at this time.
December NASDAQ
Late in yesterday’s session the NASDAQ traded higher to my 7810 sell level. I am still short and I will add to this position on any further move higher to 7860 with a tight 7895 stop. I will now move my T/P level higher to 7775 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
December BUND
My latest 174.74 short position worked well with the market falling 75 points and this move lower enabled to cover this position at my 174.54 T/P level and I am now flat. Today I will again look to sell the Bund from 174.60/175.20 with a 175.55 stop.
Gold Rolling Contract
Gold having traded to a high of 1536 on Tuesday fell $36 to a low of 1500. This was no surprise given the extreme sentiment levels towards the precious metals. This move lower saw Gold trade the whole of my buy range for a 1506 average long position. Earlier this morning I emailed my Platinum Members to exit any long position at 1509.50 and I am now flat. Gold has strong support from 1482/1492 and I will be a buyer on any dip to this area with a 1474 stop.
Silver Rolling Contract
Silver traded lower to my 18.10 buy level. I am still long and I will now lower my T/P level on this position to 18.25 with a now higher 17.65 stop.
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