A combination of higher Oil prices and 10-Year Treasuries hitting 4.30% saw U.S. Equity Markets sell off across the board yesterday. Although the S&P was lower by 1.2% at one stage, a late 25 Handle rally saw the S&P end Wednesday with a loss of 0.70%. Oil prices have now closed higher for a near record nine consecutive trading sessions. The recent strengthening of the U.S. Dollar is exerting downward pressure on Asian currencies and acting as a hindrance to the Euro’s upward trajectory. Japan and China have felt compelled to release official statements, affirming their commitment to deploying significant measures, if necessary, to safeguard their domestic currencies from further depreciation. The persistent series of interest rate hikes by the U.S. Federal Reserve has surpassed the expectations of most analysts, bolstering the resilience of the U.S. Dollar. A strong dollar is poised to deter various Asian central banks from implementing rate cuts and adopting more accommodative monetary policies. Federal Reserve Governor Christopher Waller believes policymakers can “proceed carefully” with interest-rate hikes as recent data showed cooling inflation. Waller emphasised that there is no immediate need for rate hikes and the Fed can wait for additional data before making its decision. He highlighted a softening job market and gains in Non-Farm Payrolls as support for keeping rates flat. Waller’s cautious stance aligns with the Fed’s data-driven approach as policymakers assess the state of the economy to determine their next steps. Chipmaker Arm is planning to raise up to $4.87 billion in its initial public offering (“IPO”). The IPO will release 95.5 million American depositary shares for $47 to $51 each, valuing Arm as much as $54.5 billion. The company is focused on advanced computing, designing chips for data centres and artificial intelligence (“AI”) applications. Arm’s target valuation reflects the belief that it will benefit from the demand for AI chips and generative AI. Meanwhile, the Bank of Canada held Interest Rates as expected at 5% in their latest policy meeting. European Markets closed lower. Saudi Arabia and Russia extended their oil supply cuts by an additional three months, exceeding expectations of a one-month extension. This decision surprised the market, leading to a rise in Brent crude prices. The move has faced criticism from global consumers who worry about the potential impact on inflation and economic recovery. Despite the costs to Saudi Arabia’s economic growth projections and sales volumes, the kingdom is willing to continue with its “price over volume” strategy to support oil prices. In Asia, China’s services sector expanded at its slowest pace in eight months for August, according to the Caixin services Purchasing Managers’ Index (“PMI”). The PMI fell from 54.1 in July to 51.8 in August, signalling a slowdown in the sector. While China’s manufacturing sector saw a jump in activity, sluggish demand, a property market downturn, and a slowing labour market recovery continue to weigh on the services sector. Despite China’s attempts to boost growth, the sector remains under pressure. Elsewhere, Oil rose 0.3%, while Gold closed lower by 0.3%.
To mark my 2875th 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 110 points yesterday and is now down by 15 points for September, after finishing August with 1485 points gain following a small gain of 285 points gain in July, after closing June with a gain of 2683 points. May closed with a gain of 3205 points. April saw a gain of 3354 points while March closed with a gain of 6168 points. The Platinum Service made 3164 points in February, 4687 points in January 2054 points in December, 4789 points in November and a record 9619 points last October. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1900 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 0.70% lower at a price of 4465.
The Dow Jones Industrial Average closed 198 points lower for a 0.57% loss at a price of 34,443.
The NASDAQ 100 closed 0.88% lower at a price of 15,371.
The Stoxx Europe 600 Index closed 0.56% lower.
This morning, the MSCI Asia Pacific closed 0.5% higher.
This morning, the Nikkei closed 0.62% higher at a price of 33,241.
Currencies
The Bloomberg Dollar Spot Index closed 0.20% higher.
The Euro closed 0.1% higher at $1.0726.
The British Pound closed 0.4% lower at 125.04.
The Japanese Yen fell 0.2% closing at $147.60.
Bonds
Germany’s 10-year yield closed 5 basis points higher at 2.61%.
Britain’s 10-year yield closed 1 basis points higher at 4.53%.
U.S.10 Year Treasury closed 4 basis points higher at 4.30%.
Commodities
West Texas Intermediate crude closed 0.3% higher at $87.54 a barrel.
Gold closed 0.3% lower at $1916.10 an ounce.
This morning on the Economic Front we already had the release of German Industrial Production which fell 0.8% versus -0.4.0% expected. Next, we have Euro-Zone GDP and the Employment Change at 10.00 am. This is followed at 1.30 pm by U.S. Weekly Jobless Claims and Unit Labour Costs. Finally, the Fed’s Harker, Williams, Bostic and Bowman are all scheduled to speak at 3.00 pm. 8.30 pm, 8.45 pm and 9.55 pm respectively.
Cash S&P 500
I would have expected the S&P to have found support at its 50-Day Moving Average at 4475, but know this support level was easily broken, helping the S&P to an afternoon low at 4442 before a late rally saw the market close at 4465. This move lower saw my second buy level at 4470 triggered, for a now 4479 average long position. I will now lower my T/P level to 4487. With the Apple iPhone launch on Tuesday I would expect equity markets to rally ahead of this key event. Remember seasonal charts are still positive until September 15 before we hit the seasonal weakest period of the year. Ahead of this seasonal turn I will look to get a macro short position on board. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
EUR/USD
No Change. The Euro traded in a narrow range yesterday and I am still flat. The Euro has support from 1.0600/1.0670 where I will be an aggressive buyer with a 1.0535 ‘’Closing Stop’’. The Euro has resistance at its 200 Day Moving Average (1.0780) I will be a small seller from 1.0780/1.0840 with a tight 1.0875 ‘’Closing Stop’’.
September Dollar Index
I am still short the Dollar at 104.70. I will continue to look to add to this position at 105.30 with the same 105.85 ‘’Closing Stop’’. I will now raise my T/P level to 104.30. If any of the above levels are hit, I will be back with a new update for my Platinum Members
Cash DAX
Despite the awful German Factory Orders Report yesterday morning, the DAX surprisingly did not have an aggressive sell-off. I am still flat. Today, I will continue to be a buyer on any further dip lower to 15530/15610 with the same 15475 ‘’Closing Stop’’. I still do not want to be short the DAX at this time.
Cash FTSE
No Change. I am still flat. The FTSE has short-term support from 7280/7340 where I will be a buyer with a 7235 ‘’Closing Stop’’. Given how strong the FTSE was yesterday, I will now raise my sell level to 7470/7530 with a higher 7585 ‘’Closing Stop’’.
Dow Rolling Contract
The Dow got hit hard yesterday for the third consecutive session. This move lower hit my buy range and I am now long at 34430. I will add to this position at 34180 with a now lower and tight 34095 ‘’Closing Stop’’. If any of the above levels are hit I will be back with a new update for my Platinum Members
Cash NASDAQ 100
So much for Apple shares holding the previous 10-day rally as their share price got slammed yesterday, closing lower by 3.5%. This move lower saw all three American Indexes hit hard. The NDX hit my buy range and I am now long at 15350. I will add to this price at 15220 while leaving my 15095 ‘’Closing Stop’’ unchanged. I will now lower my T/P level to 15490. If any of the above prices are hit, I will be back with a new update for my Platinum Members.
December BUND
Wrong! Unfortunately, I was topped out of my 132.20 long September Bund at the 131.10 expiration yesterday and I am now flat. I have now rolled to the December Contract which is trading at a price of 130.50 as I go to press. The December Contract has strong support from 129.30/130.10 where I will be an aggressive buyer with a 128.75 ‘’Closing Stop’’. If my buy level is triggered, I will have a T/P level at 130.80.
Gold Rolling Contract
Gold continues to trade heavy as yet again any move above 1960 is met by aggressive selling. I am still flat Gold as I continue to be a buyer from 1890/1905 with the same 1883 ‘’Closing Stop’’.
Silver Rolling Contract
No Change. I am still long at an average rate of 24.05 with the same 22.95 ‘’Closing Stop’’. I will now lower my T/P level to 24.40. If any of the above levels are hit, I will be back with a new update for my Platinum Members
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