U.S. Indices closed substantially lower on Monday led by the 3.8% fall in the NASDAQ 100 and 2.7% fall in both the S&P 500 and RUSSELL 2000. This move lower wiped out Friday’s late rally and hitting six-month lows on concerns over the US economy, present/incoming US tariffs and retaliatory tariffs from others. For example: China’s latest retaliatory tariffs (effective Monday) weighed. Sectors ex-Utilities & Energy were in the red, with all of the MAG-7 losing ground. As such, Technology, Discretionary, and Communications were hit the hardest. For Discretionary, pressure came largely by way of Tesla (TSLA) having its worst day since 2020 (-15%) after China vehicle exports tanked in February. In FX, the Dollar caught relief from recent heavy selling, prevailing over the Canadian Dollar amid intensifying relations between Canada and the US, given that the incoming Prime Minister Carney showed no immediate plan of removing their tariffs on the US. Meanwhile, the Euro was weighed on by a Greens Party official recommending the party’s lawmakers to not vote for the spending plan bill, contending it must show investment going towards climate and the country. On Crude, prices were lower by over USD 1/bbl with energy/geopolitical updates taking the backfoot as the subdued demand picture took the reins. That said, the US Energy Secretary said he is looking at working with Congress on cancelling mandate sales from oil reserve. In geopolitics, via AFP, Kyiv will propose a truce in the air and sea during talks with Washington in Riyadh. Elsewhere, Treasuries were firmer across the curve, with the 10-year yield having its biggest down day since September, -10bps, as risk-off trade lifted the space higher. Data in the US was contained to the New York Fed SCE, which saw the 1-year ahead exp. inflation rise to 3.1% (prev. 3.0% in Jan) and consumers expected probability of missing debt payments at its highest level since April 2020. For the week ahead, main events take off on Wednesday, with US tariffs on aluminum and steel to go into effect and the release of February CPI, ahead of PPI on Thursday and University of Michigan Consumer Survey on Friday. In February’s New York Fed Survey of Consumer Expectations, it saw 1 year ahead inflation expectations tick slightly higher to 3.1% (prev. 3% in Jan), while both the 3 year and 5 year ahead expected inflation were both unchanged at 3%. Elsewhere within the report, consumers’ year-ahead expectations about their households’ financial situations deteriorated considerably in February. The share of households expecting a worse financial situation one year from now rose to 27.4%, its highest level since November 2023. Expected home price climbed 3.3% (prev. 3.2% in Jan), and the mean unemployment expectations, or the mean probability that the US unemployment rate will be higher one year from now, jumped up by 5.4ppt to 39.4%, its highest reading since Sept. 2023. Lastly, the average perceived probability of missing a minimum debt payment over the next three months increased by 1.3 ppt to 14.6%, its highest level since April 2020. Elsewhere, Oil closed lower by 1.67% while Gold ended Monday’s session with a loss of
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For anyone following my Platinum Service it lost 1745 points yesterday and is now down by 1906 points for March after 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 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 2.7% lower at a price of 5614.
The Dow Jones Industrial Average closed 890 points lower for a 2.08% loss at a price of 41,911.
The NASDAQ 100 closed 3.81% lower at a price of 19,430.
The Stoxx Europe 600 Index closed 1.29% lower.
Yesterday, the MSCI Asia Pacific closed 0.4% lower.
Yesterday, the Nikkei closed 0.38% higher at a price of 37,028.
Currencies
The Bloomberg Dollar Spot Index closed 0.1% lower.
The Euro closed 0.05% higher at $1.0834.
The British Pound closed 0.23% lower at 1.2876.
The Japanese Yen rose 0.6% closing at $147.16.
Bonds
Germany’s 10-year yield closed 3 basis points lower at 2.82%.
Britain’s 10-year yield closed 1 basis points lower at 4.59%.
U.S.10 Year Treasury closed 11 basis points lower at 4.19%.
Commodities
West Texas Intermediate crude closed 1.67% lower at $65.92 a barrel.
Gold closed 0.8% lower at $2892.10 an ounce.
This morning on the Economic Front we have no Economic data of note from either the Euro-Zone or the U.K. At 2.00 pm we have the U.S. JOLTS Job Openings. Finally, at 5.00 pm we have a Three-Year Treasury Auction.
Cash S&P 500
Wrong! Sentiment, the price action, confidence, and the persistent all over the map news flow make it virtually impossible to have any sort of investment thesis given the extreme high levels of uncertainty driven by policy volatility. And the longer this goes on one can imagine all sorts of negative impacts on the economy and ultimately earnings. Yet at the same time, as unprecedented as this situation may be on some levels, situations like this also create a tinderbox environment where any sign of relief can set markets up for a melt up. Very tricky all this. This week is already looking like a set up for another theater of chaos which could rip markets either way, never mind the political, we have again a ton of economic reports to digests, i.e. a new round of CPI and PPI reports, and more consumer confidence data which sure looks to be dreadful amid all that is going on. Oh, and then a looming government shutdown. No idea if we get it or not. Although since at least 1990 every government shutdown was not actually bearish for markets and usually they only last a few days or weeks. But we will see. During corrections analytical emphasis increasingly shifts to ever lower targets as fear is widespread and the world is falling apart. It is true in some sense, as things can always become worse. I myself can outline all sorts of doom scenarios here, i.e. we are just at the beginning of a major bear market if the economy indeed falls into recession as a result of all this tariff circus. However, with the Fear and Greed Index closing at a new low of 15 last night I cannot help but be a strong buyer of these dips despite the massive loss that I took yesterday. I still believe that we are close to a bottom. History shows that moments like these—when uncertainty is high and everyone’s running for the exits—are precisely when the biggest, boldest, and best investing opportunities emerge. We saw this recently in both COVID and the Banking Crisis from 2023 which were both major bottoms. If markets continue to move lower, then the next major support level is the July low at 5500. Yesterday I was stopped out of my large 5789 large long S&P position at 5675. Shortly after the close the Fear & Greed Sentiment reading printed a new low at 15 which is one of the lowest readings in history. After the markets closed I emailed my Platinum Members to buy the S&P again which I did at an average rate of 5587. I am still long with no stop. I will have a T/P level on this position at 5690. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
EUR/USD
The Euro rallied to my 1.0870-sell level. I am still short with a now higher 1.0800 T/P level. I will add to this position on any further move higher to 1.0940 while leaving my 1.1005 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dollar Index
No Change: I am still long at an average rate of 103.75 with a now lower 104.40 T/P level. I will leave my 102.85 ‘’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
Monday’s sell-off saw the Russell hit my second buy level at 2040 for a now 2060 average long position. So far, the Russell is getting no respite from lower Treasury Yields but in my opinion given how oversold the Russell is trading, I would expect the Russell to get a ‘’Bid’’ and move higher. I will leave my 1985 ‘’ Closing Stop’’ unchanged while lowering my T/P level to 2110. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash FTSE
The FTSE got hit hard yesterday, trading the whole of my buy range for a now 8630 average long position. I will leave my 8535 ‘’Closing Stop’’ unchanged, while lowering my T/P level to 8690. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dow Rolling Contract
Wrong! After the Dow traded the whole of Monday’s buy range for a 42270 average long position, I was stopped out of this trade at 41995 and I am still flat. This morning, the Dow is trying to recapture its 200 Day Moving Average (41925) as I go to press. The Dow has further short-term support from 41500/41750 where I will again be a buyer with a lower 41295 ‘’Closing Stop’’. If triggered, I will have a T/P level at 42280.
Cash NASDAQ 100
Wrong! The NDX hit my second buy level at 19950 for a 20025 average long position before stopping me out of this trade at a price of 19695. The carnage to the Mag 7 is incredible. Tesla alone closed 15% lower last night at a price of $222I. In late December Elon’s share price was $485 – a 60% fall in less than 10 weeks. Given the ‘’Extreme Fear’’ in the market and the fact that the NDX had its biggest daily loss since September 2022, I emailed my Platinum Members to buy the NDX again after the close which we did at an average price of 19250. I will have no stop on this position while my T/P level will be at a price of 19740. If any of the above prices are hit, I will be back with a new update for my Platinum Members.
December BUND
I am still flat the Bund as the market never came close to Monday’s buy range. I will now raise my buy level to 127.40/128.20 with a higher 126.55 ‘’Closing Stop’’. If triggered, I will have a T/P level at 128.90.
Gold Rolling Contract
No Change: Gold continues to attract large buying on any dip, wiping out all of Friday’s sell-off in a bid only session on Monday. I am still flat. I will continue to be a buyer on any dip lower to 2830/2846 with the same 2817 ‘’Closing Stop’’.
Silver Rolling Contract
No Change: I am still flat. I will continue to be a buyer on any dip lower to 30.70/31.50 with the same 29.85 ‘’Closing Stop’’. If triggered, I will have a T/P level at 32.20.
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