Following a volatile trading session U.S. Equity Markets got hot hard yesterday, led by the NDX closing lower by 1.53%. This move lower saw the VIX close 9% higher at a price of 20.31. Boris Johnson’s confirmation that the U.K. has seen its first death from the Omicron variant spooked investors. Still, the vaccines likely provide protection against the variant. An Israeli study showed three shots of Pfizer’s (PFE) COVID-19 vaccine offered individuals significant protection against the new strain. Friday’s close also marked a record high for the S&P 500, so investors were likely locking in some profits ahead of the big event of the week – the Federal Reserve’s policy meeting and announcement tomorrow night. Wall Street is expecting an announcement on a quicker asset-purchase tapering, as well as sooner estimates for coming rate hikes. Investors are now moving to the sidelines until they get a clear picture of what the central bank is going to do. Within the S&P 500, seven of the 11 sectors finished lower. European Markets closed higher. British Prime Minister Boris Johnson warned the country faces a “tidal wave” of infections from the COVID-19 Omicron variant, moving up the booster availability date to December 31. However, Austria lifted its coronavirus social-distancing restrictions for all citizens, while keeping restrictions in place for the unvaccinated. Like Asia, central bank activity is on investors’ radars, with the European Central Bank also having its policy meeting later this week. In Asia, The Chinese Communist Party’s annual Central Economic Work Conference late last week said Beijing will do more to maintain stability and remain flexible on policy next year. This got investors thinking that more stimulus was on the way. This trend continues this week, with the Bank of Japan set to have its policy announcement. From that announcement, investors are expecting the central bank to continue its current stimulus efforts. This is especially true given the Tankan Manufacturing Business Outlook index, which came in below estimates for the fourth quarter. In other news, the Bank of Korea said the country needs to adjust high debt levels or run the risk of financial instability down the road. Elsewhere, Oil fell 0.5% despite OPEC and its allies saying that the Omicron variant will only have a mild and short-term impact on oil demand, while Bitcoin fell 5% on little news.
To mark my 2450th 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 135 points yesterday, and is now down by 816 points for December, having made 2466 points in November, 1028 points in October, 2866 points in September, 1543 points in August, and 996 points in July. The Platinum Service made 1366 points in June, 1439 points in May, 1244 points in April, having ended March with an impressive gain of 3769 points, 3286 points in February, 2077 points in January, and 2273 points last December. 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 0.91% lower at a price of 4669.
The Dow Jones Industrial Average closed 320 points lower for a 0.89% loss at a price of 35,650.
The NASDAQ 100 closed 1.53% lower at a price of 16,082.
The Stoxx Europe 600 Index closed 0.3% higher.
This morning, the MSCI Asia Pacific Index rose 0.1%.
This morning, the Nikkei closed 0.73% lower at a price of 28,432.
Currencies
The Bloomberg Dollar Spot Index closed 0.1% higher.
The Euro closed 0.1% lower at $1.1279.
The British Pound closed 0.2% lower at 1.3206.
The Japanese Yen fell 0.1%, closing at $113.55.
Bonds
Germany’s 10-year yield closed three basis points lower at -0.38%.
Britain’s 10-year yield closed four basis points lower at 0.70%.
US 10 Year Treasury closed six basis points lower at 1.43%.
Commodities
West Texas Intermediate crude closed 0.50% lower at $71.85 a barrel.
Gold closed 0.16% higher at $1,787.20 an ounce.
This morning on the Economic Front we already had the release of U.K. Jobless Claims which fell 49.8K versus last month’s -14.9K. At 10.00 am we have Euro-Zone Industrial Production followed by the NFIB Business Optimism Index at 11.00 am. Finally, we have U.S. PPI at 1.30 pm.
December S&P 500
Although the S&P closed at its highest price level ever on Friday, the Small Cap Russell 2000 closed below its 200-day Moving Average emphasing that most stocks are close to trading in a Bear Market. This divergence is making conditions extremely tough as we wait for the FOMC Statement tomorrow. Traders know that if the Stock Market has an aggressive sell-off that the Fed will reverse course and continue with their QE Policy. The S&P got hit hard yesterday afternoon, hitting my 4703 T/P level on Friday’s late 4708 short position, before trading the whole of my buy range for a 4693 average long position. Unfortunately, a late sell-off in the last 20 minutes of trading saw my 4673 stop triggered and I am now flat. Everyone is piling into the Apples of this world. This is reflected in Berkshire Hathaway which is the 9th largest stock in the world with a Market Cap of $645bn having a $157bn position in Apple. This is serious Cross Risk. Ahead of the Fed Meeting tomorrow I find it difficult to be short as I cannot see Powell disappointing the Markets ahead of Christmas. The S&P has strong support from 4638/4653 where I will again be a buyer with a 4625 stop. I do not want to be short the S&P at this time.
EUR/USD
No Change. I am still a buyer on any dip lower to 1.1190/1.1240 with a 1.1145 stop. The Euro has resistance from 1.1350/1.1400 where I will be a small seller with a lower 1.1441 stop.
March Dollar Index
I am still short the Dollar from last week at 96.25 sell level with the same 96.81 stop. I will now raise my T/P level on this position to 96.10.
December DAX
The DAX again outperformed the other main Indexes and I am still flat.. This morning the DAX is opening higher at 15670. I will again raise my buy level to 15470/15540 with a tight 15395 stop. If I am taken long I will have a T/P level at 15595.
December FTSE
Despite the weak Pound the FTSE sold off yesterday, hitting my initial 7235 buy level. As I wanted to be flat overnight I emailed my Platinum Members to exit any long position at 7250.Tis morning the FTSE is opening higher at 7272. We have support from 7160/7220 where I will again be a buyer with a 7125 tight stop. If I am taken long I will have a T/P level at 7255.
Dow Rolling Contract
The Dow got hit hard yesterday, falling nearly 500 points from its lunchtime high. This move lower saw the whole of my buy range filled for a now 35790 average long position. I will now lower my T/P level to 35820 while leaving my 35595 stop unchanged. If any of the above levels are filled I will be back with a new update for my Platinum Members. I still do not want to be short the Dow at this time.
December NASDAQ
The NDX led the decline yesterday having just missed my initial 16440 sell level. This move lower saw the whole of my buy range executed for a now 16220 average long position. I will now lower my T/P level to 16250 while leaving my 16055 stop unchanged.
March BUND
The Bund rallied to my 174.45 sell level. I am still short as I continue to look to add to this position on any further move higher to 174.95 while leaving my 175.25 stop unchanged. I will now raise my T/P level to 174.25 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
Gold Rolling Contract
The boring sideways price action in Gold continues. With a lot of traders still trapped long $100 above current prices I will now raise my Gold buy level slightly to 1745/1760 with a higher 1732 stop.
Silver Rolling Contract
No Change. I am still an aggressive buyer on any dip lower to 20.95/21.55 with a 19.95 higher stop.
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