U.S. Indices were rangebound to start the week, while the Russell 2000 (+0.4%) outperformed in thin newsflow and typical summer trading conditions as focus resided around US/Ukraine/Russia updates. On Friday, after the close, Trump and Putin held a summit, whereby Trump hailed great progress and called it a “10” but no ceasefire was achieved. Trump, Zelensky and European leaders are meeting at the time of writing, and prior to it both Trump and Zelensky touted a possible trilateral meeting with Russia. Sectors were mixed with Industrials and Consumer Discretionary sitting atop of the pile, with Real Estate and Energy the laggards. The stock specific highlight was reports that the Trump admin is looking at taking a 10% stake in Intel (INTC). The Dollar is firmer with JPY, GBP, and EUR the G10 laggards and weakening off of the aforementioned Buck strength, as opposed to anything currency specific. The crude complex saw gains, and firmed through the US afternoon with upside coinciding with a WSJ piece that the US could leverage intelligence sharing to press for a Ukraine deal. Treasuries saw marginal gains across the curve, and precious metals were more-or-less flat. There was no Tier 1 US data or Fed speak, for the record, as attention turns to Jackson Hole later this week whereby Fed Chair Powell is scheduled to speak on Friday at 10:00EDT. NAHB housing market index for July surprisingly fell to 32.0 from 33.0, against expectations for a rise to 34.0. Current single-family home sales slightly dropped to 35.0 from 36.0, home sales over the next six months remained at 43.0 (prev. 43.0), while prospective buyers rose to 22.0 from 20.0. Homebuilder sentiment slipped as uncertainty about the economic outlook and affordability challenges keep prospective homebuyers on the sidelines, and as such, Oxford Economics expects gloomy homebuilder sentiment will weigh on single-family housing starts over the balance of this year. In addition, OxEco notes builders continue to offer incentives, including price cuts in their effort to move inventory; completed homes for sale are now at a 16-year high. The consultancy thinks incentives are more likely to keep a floor under new home sales than boost sales. Elsewhere, Oil closed 1% higher while Gold was flat.
To mark my 3225th 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 made 53 points yesterday and is now ahead by 2332 points for August 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 0.01% lower at a price of 6449.
The Dow Jones Industrial Average closed 34 points lower for a 0.08% loss at a price of 44,911.
The NASDAQ 100 closed 0.01% higher at a price of 23,713.
The Stoxx Europe 600 Index closed 0.01% higher.
This Morning, the MSCI Asia Pacific closed 0.4% lower.
This morning, the Nikkei closed 0.43% lower at a price of 43,525.
Currencies
The Bloomberg Dollar Spot Index closed 0.27% higher.
The Euro closed 0.29% lower at $1.1667.
The British Pound closed 0.39% lower at $1.3505.
The Japanese Yen fell 0.44% closing at $147.81
Bonds
U.K.’s 10-Year Gilt closed 6 basis points higher at 4.76%.
Germany’s 10-Year Bund Yield closed 1 basis points lower at 2.77%
U.S.10 Year Treasury closed 3 basis points higher at 4.35%.
Commodities
West Texas Intermediate crude closed 0.99% higher at $63.42 a barrel.
Gold closed 0.11% lower at $3332.10 an ounce.
This morning on the Economic Front we have Euro-Zone Current Account at 9.00 am. This is followed by U.S. Building Permits and Canadian CPI at 1.30 pm. Next, we have the GDP NOW at 4.30 pm. Finally, we have a speech from Fed Member Bowman at 7.10 pm.
Cash S&P 500
The S&P traded in a narrow range on Monday, and I am still flat. It was the lightest volume day on the S&P 500 futures since July 3, a half-day. Just 821,000 contracts traded on Monday. I have written at length about how overvalued this market is and waiting for a ‘’TOP’’ is tough. Take 1999 as an example: One would have been absolutely correct in saying this is madness, but as we know the S&P did not top out until March 2020. People were willing to pay any ridiculous valuations and kept chasing. At this moment in time, we are seeing the same scenario repeat itself but as we know momentum does not die until it does. Some of the various valuation charts keep screaming danger and from where I sit massive caution as there is sizeable risk of reversion or even in the most extreme outcome: ‘’CRASH’’. Nvidia alone now represents 8.2% of the S&P 500 and is 50% larger in Market Cap than the entire RUSSELL 2000. This means that nobody is diversified in buying any of the big ETFs. Leverage is the weapon of mass destruction in financial markets. They work great on the way up but once a trigger unwinds at all the downside becomes absolutely brutal. As I mentioned in Monday’s DC the main driver of this melt up has been massive liquidity and easing of financial conditions while buybacks are expected to be $1.1 trillion in 2025 which is also offering liquidity support. Given this backdrop I have no interest in buying the S&P without a meaningful sell-off first. Therefore, I will continue to sell rallies with tight stops. Today, I will leave my sell level unchanged from 6468/6488 with the same 6505 ‘Closing Stop’. If I am taken short, I will have a T/P level at 6443
EUR/USD.
The Euro had a small retracement on Monday. To bank some points for yesterday’s commentary I covered my latest 1.1715 short position at my revised 1.1662 T/P level and I am now flat. Today, I will again be a seller from 1.1710/1.1790 with the same 1.1855 ‘Closing Stop’. If I am taken short, I will have a T/P level at 1.1640. I still do not want to be long the Euro at this time.
Dollar Index
I am still long the Dollar at a rate of 98.00. I will add to this position at 97.30 while leaving my 96.75 ‘Closing Stop’ unchanged. I will leave my T/P unchanged at 98.40. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Russell 2000
No Change: I am still short the Russell from last week at an average rate of 2280. Just like the other three main American Indexes, last Thursday’s recovery high in the Russell came with a large negative divergence. Today, I will leave my 2365 ‘Closing Stop’ unchanged while raising my T/P level to 2245. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
FTSE 100
The FTSE traded sideways on Monday despite Friday’s Key Day Reversal from a new all-time high on negative divergence. The Monthly chart is screaming danger given the vertical nature of the FTSE rally since the April lows. Overnight, the FTSE hit my sell range for a now 9185 short position. I will add to this trade at 9255 while leaving my 9305 ‘Closing Stop’ unchanged. I will now raise my T/P level to 9130. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dow Rolling Contract
I am still flat as the Dow never came close to Monday’s sell range. There is not much happening this week. Even the data calendar is light, with the highlights coming on Thursday in the form of Jobless Claims and Flash PMI readings, along with a very rare 30-Year TIPS auction. Otherwise, all eyes will be on Jay Powell’s Jackson Hole speech on Friday afternoon. This year’s Jackson Hole speech will be Powell’s last. Jackson Hole used to be a major event—especially in the years following the GFC, when Ben Bernanke often gave the market hints about QE. In more recent years, it has been used to signal the policy path for rate hikes and cuts. This year, it is not clear what Powell will say. I don’t think he is in a rush to cut rates, not with inflation still running hot. I would be surprised if he gave that signal ahead of next week’s PCE data and the August jobs report the week after. My guess is he will stay out of the spotlight and avoid drawing attention to himself, so as not to invite further criticism from Trump. Today, I will continue to be a small seller from 45150/45400 with the same 45605 tight ‘Closing Stop’. I still do not want to be long the Dow at this time. If I am taken short, I will have a T/P level at 44920.
Cash NASDAQ 100
No Change: The NASDAQ Market Cap has reached a new peak at 145% of U.S. Money Supply as of Q2. There is absolutely no risk/reward in being a buyer at these levels while the P/Es are stretched to the upside. I know markets can rally further but not by me at these inflated prices. Adding the mix is that both Meta and Microsoft are spending 25% and 47% respectively of their capital expenditure on NVIDIA Chips. This is insane as these data centres use so much water and electricity to run their facilities. The only company making money on AI is Nvidia given the number of chip orders. I am still short the NDX at an average rate of 23620 with the same 23905 ‘Closing Stop’. Today, I will leave my T/P level at 23590 and reassess if hit. If this view changes, I will be back with a new update for my Platinum Members.
December BUND
I am still long the Bund from last Friday at a price of 128.95. I will add to this position on any further move lower to 128.25 while leaving my 127.75 ‘Closing Stop’ unchanged. I will now lower my T/P level to 129.50. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
I am still flat. I will continue to look to buy Gold on any further dip lower to 3280/3300 with a the same 3259 ‘Closing Stop’. If I am taken long, I will have a T/P level at 3321. If this view changes, I will be back with a new update for my Platinum Members.
Silver Rolling Contract
I am still flat. Today, I will leave my Silver buy level unchanged at 36.50/37.30 with the same 35.25 ‘Closing Stop’. If I am taken long, I will have a T/P level 38.00.
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