U.S Equity Markets reversed most of Tuesday’s late plunge after President Donald Trump proposed aid for individuals, small businesses, and airlines. This was in stark contrast to his comments from late Tuesday, where he had suspended further Coronavirus-stimulus negotiations. While the future of any stimulus is still uncertain, Trump’s comments sparked optimism that there is still a chance a Bill gets done. The Federal Reserve released its Minutes from the September Meeting, with officials saying that the current pace of asset purchases will be maintained to help boost the economic recovery. The Fed members also said that Interest Rates will remain near zero for at least three years, matching what Fed Chair Jerome Powell said in his post-meeting press conference. The Dow led the rally, closing higher by 1.91%. European Markets closed mixed. International Monetary Fund Managing Director Kristalina Georgieva said global economic contraction would not be as bad this year as the group’s 4.9% prediction in June. A European Central Bank study expressed concern that global central bank independence is being lost to mounting political pressures surrounding stimulus support. German Industrial Production surprisingly contracted in August, indicating that economic recovery remains choppy. The German city of Berlin imposed new restrictions, including a late-night curfew for bars and restaurants, in an effort to contain a Coronavirus resurgence. Elsewhere, Oil closed 1.68% lower after the EIA lowered its demand outlook in the U.S., while Gold closed 1% lower on little news.
To mark my 2150th 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 95 points yesterday and is now ahead by 886 points for October, having made 3042 points in September, 2383 points in August, 3128 points in July, 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 1.74% higher at a price of 3419.
The Dow Jones Industrial Average closed 530 points higher for a 1.91% gain at a price of 28,303.
The NASDAQ 100 closed 1.88% higher at a price of 11,503.
The Stoxx Europe 600 Index closed 0.5% higher.
The MSCI Asia Pacific Index rose 0.5%%.
This morning the Nikkei closed 0.96% higher at a price of 23,647, which is the highest level since February.
Currencies
The Bloomberg Dollar Spot Index closed 0.1% lower.
The Euro closed 0.2% higher at $1.1769.
The British Pound closed 0.3% higher at $1.2935.
The Japanese Yen closed 0.1% higher at 105.91 per dollar.
Bonds
The yield on 10-year Treasuries closed three basis points higher at 0.78%.
Germany’s 10-year yield closed three basis points higher at -0.50%.
Britain’s 10-year yield closed one basis point higher at 0.30%.
Commodities
The Bloomberg Commodity Index closed 0.1% higher.
West Texas Intermediate closed 1.68% higher at $39.46 a barrel.
Gold closed 1% lower at $1879 an ounce.
This morning on the Economic Front we have speeches from Bank of England Governor Bailey at 8.25 am and ECB Member De Guindos at 9.00 am. This is followed at 9.30 am by the UK FPC(Financial Policy Committee) Statement and Meeting Minutes. Finally, we have the latest ECB Minutes and U.S U.S Weekly Jobless Claims at 12.30 pm and 1.30 pm respectively.
December S&P 500
When I mentioned yesterday that all Key Day Reversals for the S&P are quickly negated, I did not expect Tuesday’s KDR to be reversed so quickly and that is what happened this morning when the S&P stopped me out of my 3401 average short position at 3423 and I am now flat. Even though I do not agree with the S&P valuations I have to respect the fact that the S&P finally closed over its previous 3390/3400 resistance area. Yesterday was a solid session for the S&P with 89.5% of the shares comprising the Index closing higher. The S&P is now trading higher at 3430 as I go to press. I will now be an aggressive buyer on any dip lower to 3397/3412 with a 3383 stop. I no longer want to be short the S&P at this time. The S&P left a large Gap from Tuesday’s 3347 Chicago close for the December Contract to yesterday’s 3375 low print and as a result I will also be an aggressive buyer on any further dip to 3350/3365 with a 3339 stop. If I am taken long I will have a T/P level at 3423. If I am taken long a second time I will have a T/P level at 3384.
EUR/USD
My latest 1.1730 long position worked well with the Euro rallying to my 1.1760 T/P level shortly after I posted and I am still flat. The Euro has support from 1.1700/1.1740 where I will be a buyer with a 1.1655 stop. We have short-term resistance from 1.1820/1.1860 where I will be a small seller with a tight 1.1905 stop.
December Dollar Index
I am still flat and today I will now lower my Dollar buy level to 92.80/93.25 with a 92.45 stop.
December DAX
The DAX is testing key resistance at 13000 this morning as thankfully we have had no sell level in this market over the last few weeks. All sell-offs no matter how small have been bought by traders and a break and close over 13000 is buy a buy signal. I will now raise my buy level to 12850/12930 with a higher 12765 stop.
December FTSE
The FTSE again just missed my buy level before having a small rally and I am still flat. I will now raise my buy level to 5840/5890 with a 5785 tight stop. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
After the Dow rallied I emailed my Platinum Members to raise their sell level to 28350 before a late small sell-off enabled me to cover this position at my revised 28315 T/P level. At the time I was short all three US Indices which was too much risk. These markets are reacting to every headline with very little liquidity as shown my Tuesday’s 626 point fall in thirty minutes. This two-way volatility should continue until the November 3 election and as a result I am trading in smaller size. The VIX refuses to fall closing at a still high 28.06 last night while internally the market is strong with the McClellan Oscillator closing at +138. The Dow has support from 27950/28150 where I will be a buyer with a 2795 stop. I no longer want to be short the Dow at this time.
December NASDAQ
After the NASDAQ traded higher to my 11500 sell level we had a small sell-off and I covered this position at my 11475 revised T/P level and I am now flat. As mentioned yesterday the NASDAQ has been making higher lows in the last 10 days which is bullish. I will now raise my buy level to 11380/11480 with a 11295 stop. My only interest in selling the NASDAQ is on a further move higher to 11750/11850 with a 11975 wider stop.
December BUND
The boring sideways action in the Bund continues and I am still flat. I will now lower my sell level to 174.60/175.10 with a 175.45 stop.
Gold Rolling Contract
I do not like the price action in Gold and I will not chase the market higher. Therefore, I will leave my 1850/1862 buy level unchanged with the same 1839 stop.
Silver Rolling Contract
My latest 23.60 long position worked well with the market trading higher to my 23.95 T/P level and I am now flat. Today. I will again be a buyer on any dip lower to 23.05/23.65 with a 22.55 stop.
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