U.S. Indexes rallied on Monday, paring some of the downside seen on Friday. U.S. President Trump announced China will face a 100% tariff from November 1st, late on Friday, but later suggested that everything will be “fine”. Treasury Secretary Bessent yesterday said the 100% tariffs do not have to happen and that things are still in place for a Trump meeting with Chinese President Xi. The toning down of aggression on China trade from Trump had boosted sentiment and largely reversed a lot of the price action seen on Friday. Outperformance was seen in the NASDAQ and Russell, with tech gains buoying the former following a slew of deals, namely the OpenAI and Broadcom (AVGO) strategic partnership. In FX, the Dollar was bid but Antipodeans outperformed on hopes of US/China tensions easing, paring some of the underperformance seen on Friday, while haven FX lagged but Gold went on to print a fresh All-Time-High above $4100. Oil prices settled in the green due to risk-on trade, while Treasury trade was quiet with cash trade closed on account of Columbus Day, with futures settling flat. There was no data yesterday, but Fed speak saw Paulson talk on the economy and policy for the first time since she became President of the Philly Fed, where she took a neutral/dovish tone (recap of comments below). On geopolitics, the Middle East peace deal began, with seemingly no hitch, as Hamas released hostages, although Israel Defense Minister Katz condemned Hamas’ announcement about handing over four hostages’ bodies as a “failure to meet commitments” – Hamas told mediators it does not know the location of some of the other 24. Fed Member Paulson the Philadelphia Fed President spoke for the first time since becoming President of the regional bank, where she ultimately took a dovish/neutral tone. She said she is aligned with the median dot plot for the rate view by year-end but noted that policy should be focused on balancing risks to maximum employment and price stability. She called for gradual rate cuts over this year and into next, noting that gradual cuts should keep the jobs market close to full employment. She said the 25 basis points cut in September made sense, and she sees policy as modestly restrictive. Paulson also echoed arguments from Waller and Bowman that policy should look through tariff effects, as the price impacts are not persistent, but she shared the view of Goolsbee that strength in services prices bears watching. On the labour market, she suggested momentum is to the downside, noting that tariff inflation impact is smaller than expected so far. Paulson suspects the breakeven rate is lower than 75k per month. Elsewhere, Oil closed higher by 1.38% while as mentioned above Gold ended Monday’s session with a gain of 2.2%.
To mark my 3275th 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 was made 610 points yesterday and is now ahead by 2025 points for October after closing September with a gain of 3774 points after ending August with a gain of 3362 points after closing July with a gain of 3753 points after closing June with a gain of 3530 points, having closed May with a gain of 3606 points, after closing April with a gain of 7685 points after closing March with a gain of 2254 points while 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 2300 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 1.56% higher at a price of 6654.
The Dow Jones Industrial Average closed 587 points higher for a 1.29% gain at a price of 46,067.
The NASDAQ 100 closed 2.18% higher at a price of 24,750.
The Stoxx Europe 600 Index closed 0.44% higher.
Yesterday, the MSCI Asia Pacific closed 0.7% lower.
Yesterday, the Nikkei closed 1.01% lower at a price of 48,088.
Currencies
The Bloomberg Dollar Spot Index closed 0.26% higher.
The Euro closed 0.37% lower at $1.1575.
The British Pound closed 0.23% lower at $1.3331.
The Japanese Yen fell 0.74% closing at $152.26
Bonds
U.K.’s 10-Year Gilt closed 2 basis points lower at 4.66%.
Germany’s 10-Year Bund Yield closed 1 basis points lower at 2.63%
U.S.10 Year Treasury closed 6 basis points lower at 4.06%.
Commodities
West Texas Intermediate crude closed 1.38% higher at $59.71 a barrel.
Gold closed 2.21% higher at $4105.10 an ounce.
This morning on the Economic Front we have U.K. Average Earnings and Unemployment at 7.00 am. At the same time, we will get the latest German CPI Report. Next, we will see the latest ZEW Economic Sentiment for both Germany and the Euro-Zone at 10.00 am. Finally, we will have a speech from Fed Chair Powell at 5.20 pm and Bank of England Governor Bailey at 6.00 pm.
Cash S&P 500
The S&P 500 reversed half of what it lost on Friday in a dramatic rebound yesterday. The S&P gapped higher at the Chicago Open, leaving a 70 Handle ‘Open Gap’ from Friday’s Chicago close at 6552 to yesterday’s 6621 low print. This is an enormous open gap which should attract attention over the coming days. In after-hours trading on Friday evening the 50 Day Moving Average at 6538 was tagged and will again offer strong support on any retest over the coming days. Monday’s reversal off Friday’s lows shows how difficult it is to be short despite a number of key technical signals being broken with some strong negative divergences. Traders who stayed short over the weekend are now trapped given the extent of Monday’s rally. The S&P’s close at 6654 saw the market just close over its 20-Day Moving Average (6653). Any follow through today to the upside will see the 20 MA act as strong support on any subsequent test. As I said earlier, the S&P saw a gap higher at the open today, following a straight-line drop into Friday’s close. These types of patterns tend to be unstable and are often retraced fairly quickly. Given that volatility has largely reset and the index closed at the 20-day moving average, there is a good chance Monday’s rally gives back its gains, resulting in that gap being filled over the next couple of days. In the meantime, with the bond market closed, I have no idea how credit spreads would have traded yesterday, nor do I know where overnight funding costs would have settled. So, delving any further into Monday’s price action is pretty much useless. However, selling rallies worked well. Early Monday morning the S&P rallied to my 6655 sell level before trading lower to my 6616 T/P level as emailed to my Platinum Members. Subsequently, I went short the S&P again at 6650 before the market sold off to my 6628 T/P level and I am now flat. Today, I will again be a seller from 6678/6698 with a 6721 ‘Closing Stop’. The S&P has support below from 6578/6598 where I will be a small buyer with a 6561 ‘Closing Stop’. If I am taken short, I will have a T/P level at 6642. If I am taken long, I will have a T/P level at 6623. If any of these views change, I will be back with a new update for my Platinum Members.
EUR/USD
I am still flat as the Euro never came close to yesterday’s sell range. Today I will lower my sell level to 1.1640/1.1710 with a lower 1.1765 ‘Closing Stop’. If I am taken short, I will have a T/P level at 1.1570. I still do not want to be long the Euro at this time.
Dollar Index
I am still flat. Today, I will raise my buy level to 98.00/98.80 with a higher 97.25 ‘Closing Stop’. If I am taken long, I will have a T/P level at 99.45.
Russell 2000
Following Friday’s plunge in the Russell the market rebounded strongly on Monday, ending the session with a gain of 3.8%. This move higher saw my 2445 sell level triggered. I am still short and I will add to this position at 2515 with the same 2575 ‘Closing Stop’. I will now raise my T/P level to 2405. If any of the above levels are hit, I will be back with a new update for my Platinum Members
FTSE 100
I am still flat as despite Monday’s strong rebound in the FTSE my sell level was not triggered. I will now raise my sell level to 9500/9580 with a higher 96.55 ‘Closing Stop’. If I am taken short, I will have a T/P level at 9440.
Dow Rolling Contract
The Dow did not stay below its 50 Day Moving Average surging on Monday to close back above 46,000. The 50 Day MA has now moved higher to a price of 45561. Any initial sell-off over the coming days will see any test of the 50 MA met by strong buying. For this reason I will now raise my buy level to 45400/45650 with a higher 45195 ‘Closing Stop’. If I am taken long, I will have a T/P level at 45940. I still do not want to be short the Dow at this time.
Cash NASDAQ 100
Just like the other American Indexes on Monday anyone who stayed short the NDX over the weekend was yet again slammed by yesterday’s 500 point rally. I am still flat as the market never came close to my buy range. The 20 Day Moving Average has moved higher to a price of 24589. I will now look to buy the NDX from 24420/24570 with a higher 24295 ‘Closing Stop’. If I am taken long, I will have a T/P level at 24730.
December BUND
The Bund just missed yesterday’s buy range and I am still flat. I will not chase the market higher preferring to leave my 128.90/129.60 buy level unchanged with the same 128.15 ‘Closing Stop’. If I am taken long, I will have a T/P level at 130.30.
Gold Rolling Contract
It does not take a lo to surprise with markets these days but I have to say the relentless buying of Gold is just mind boggling given how overbought the precious metal is. Gold was trading at 3940 on Friday afternoon before rallying to close above 4100 last night. This move higher has me short at an average price of 4059 with no stop as emailed to my Platinum Members. I will now raise my T/P level to 4038. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Silver Rolling Contract
Silver hit a new all-time high at 52.30 yesterday afternoon. Short-Term Silver is extremely overbought. However, I have no interest in shorting the market. I will not chase the price of Silver higher as I continue to be a buyer on any dip lower to 45.80/46.80 with the same 44.15 ‘Closing Stop’. If I am taken long, I will have a T/P level at 48.30.
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