US Indexes closed mixed on Monday, with the NASDAQ 100 and S&P 500 closing lower while the Russell 2000 rallied and the Dow finished with slight gains. Sector performance was similarly mixed, with Real Estate, Energy and Health Care outperforming, while Communication Services and Consumer Discretionary were the clear laggards. A key driver of the weakness in the Nasdaq and S&P 500 was pressure in Alphabet (GOOGL), after DeepMind Vice President John Jumper departed the company to join Anthropic. Energy prices ultimately settled lower after initially gapping higher at the reopen. Iran announced it had closed the Strait of Hormuz following alleged ceasefire violations, but the move quickly reversed as signs of progress in negotiations emerged. Iranian officials later said significant progress had been made in talks in Switzerland, while Qatar and Pakistan both praised the constructive atmosphere surrounding discussions between the US and Iran. Additional downside pressure came after US VP Vance stated that the Strait remained open and said Iran had agreed to allow IAEA inspectors back into the country, although Iranian media disputed those claims about the inspectors. Crude prices also came under pressure after the US suspended sanctions on Iranian energy production, delivery and sales for 60 days, helping benchmarks fall to session lows before some profit-taking emerged into the settlement. Treasuries weakened across the curve despite the decline in oil prices, with markets increasingly focused on the implications of last week’s hawkish FOMC decision and Chair Warsh’s emphasis on returning inflation to target. The move suggests bond investors are beginning to shift their focus from geopolitical developments and are instead adjusting to a more hawkish Federal Reserve, while the BofA MOVE index has now returned to pre-conflict levels. In FX, the Dollar strengthened against most G10 peers alongside higher Treasury yields. Sterling was the standout performer after UK’s Streeting backed Burnham to succeed Starmer following the PM’s resignation announcement, reducing the likelihood of a contested succession process. Elsewhere, USD/JPY reversed sharply lower after reaching 161.93, prompting renewed intervention speculation. Nikkei however attributed the moves to media reports that Finance Minister Katayama and US Treasury Secretary Bessent had discussed developments in the FX market. Into cash close, the moves once again pared. Precious metals were firmer, with both Gold and Silver rising despite the stronger Dollar and higher Treasury yields. Bitcoin also posted modest gains. Elsewhere, SpaceX (SPCX) gave back a significant portion of its recent rally, falling more than 15% on the session. Elsewhere, Oil closed lower by over 3% while Gold was firmer, ending Monday’s session with a 0.68% gain.
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For anyone following my Platinum Service it made 800 points yesterday and is now ahead by 8607 points for June after ending May with a loss of 1104 points, having ended April with a gain of 1730 points, after ending March with a massive gain of 9002 points, having closed February with a strong gain of 5482 points after ending January with a gain of 4757 points, having closed December with a gain of 2599 points, after ending the month of November with a gain of 4542 points, after ending October with a nice gain of 5110 points after closing September with a gain of 3774 points while 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 0.37% lower at a price of 7472.
The Dow Jones Industrial Average closed 147 points higher for a 0.29% gain at a price of 51,712.
The NASDAQ 100 closed 0.19% lower at a price of 30,347.
The Stoxx Europe 600 Index closed 0.58% higher.
This Morning, the MSCI Asia Pacific closed 0.8% lower
This Morning, the Nikkei closed 3.55% lower at a price of 69,788.
Currencies
The Bloomberg Dollar Spot Index closed 0.14% lower.
The Euro closed 0.13% lower at $1.1473.
The British Pound closed 0.32% lower at $1.3236.
The Japanese Yen fell 0.28% closing at $161.29.
Bonds
U.K.’s 10-Year Gilt closed 2 basis points lower at 4.82%.
Germany’s 10-Year Bund Yield closed 2 basis points lower at 2.96%
U.S.10 Year Treasury closed 5 basis points higher at 4.51%.
Commodities
West Texas Intermediate crude closed 3.28% lower at $73.32 a barrel.
Gold closed 0.68% higher at $4184.10 an ounce.
This morning on the Economic front we have German, Euro-Zone and U.K. Manufacturing PMI at 8.30 am, 9.00 am and 9.30 am respectively. Next, we have U.K. CBI Industrial Trends at 11.00 am and U.S. ADP Weekly Employment Change at 1.15 pm. This is followed by Manufacturing PMI at 2.45 pm and the Richmond Fed Manufacturing Index at 3.00 pm. Finally, we have a Two-year Treasury Auction at 6.00 pm.
Cash S&P 500
The S&P 500 closed lower by 0.4% on Monday, with technology stocks leading the decline. If not for the strength in semiconductors, the sell-off could have been much worse. However, Tech is lower by a further 2% overnight, leading to a 100-Handle fall in the S&P as I go to post. What is becoming increasingly clear from a technical perspective in the S&P 500 is that the Index is consolidating and may be forming a diamond pattern. There appears to have been a widening formation leading into the June 2 peak, followed by the current consolidation phase, which is consistent with a diamond top pattern. Meanwhile, the falling RSI suggests that momentum has faded significantly over the past several weeks and has yet to recover. That would be viewed as a negative technical signal for the Index. I have not been entirely sure what to call the pattern in the Nasdaq 100 at this point—perhaps a parallelogram or some form of narrowing consolidation. Regardless of the label, both the Nasdaq 100 and the S&P 500 have spent the past several days consolidating. The trading ranges continue to tighten, and the wedge appears to be nearing completion, suggesting that a breakout in either direction could be approaching. The overnight moves suggest that the breakout is now to the downside with the S&P trading over 150 Handles lower from Monday afternoon’s 7530 high print. Two-year Treasury yields rose on the day despite falling oil prices, climbing to roughly 4.25%. If the 2-year yield has indeed broken out of the bull pennant highlighted on the chart, the measured move projection would suggest a rise toward 4.4%. Such a move would likely reinforce the recent tightening in financial conditions and could present an additional headwind for equities. Meanwhile, the Dollar Index continued to strengthen, having broken above resistance at 100.50 last week and now trading north of 101. If the pattern is similar to the bull pennant seen in the 2-year yield, the measured-move projection would suggest the Dollar Index could extend its rally toward 103.40. A move of that magnitude would likely create additional pressure on risk assets, weigh on commodities, and further tighten financial conditions. Oil prices fell again and continue to weaken as the market looks beyond tensions in the Middle East. A move down to around $67 would fill the gap created in early March and complete the unwind of the bearish head-and-shoulders pattern that had previously formed. For now, the technical setup suggests that the recent geopolitical premium in oil prices continues to fade as supply concerns ease and traders refocus on broader macroeconomic factors. TBD. My S&P plan worked well on Monday as the S&P traded higher to my 7516 sell level before trading lower to my 7485 T/P level. This move lower continued overnight as the S&P hit my buy range for a now 7386 long position. I will add to this trade at 7362 with a now lower 7345 tight ‘Closing Stop’. Given the large ‘Open Gap’ from Monday’s close, I will now lower my T/P level on this long position to 7412. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
EUR/USD
I am still long the Euro at an average rate of 1.1460 with the same 1.1510 T/P level. I will also leave my 1.1345 ‘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
I am still flat as the Dollar never came close to Monday’s buy range. Today, I will raise my buy level to 99.70/100.40 with the same 98.95 ‘Closing Stop’. If I am taken long, I will have a T/P level at 100.95.
Russell 2000
I am still short the Russell at a price of 2990. I will add to this position at 3060 while leaving my 3115 ‘Closing Stop’ unchanged. I will leave my T/P level on this position unchanged at 2950. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
FTSE 100
My latest 10360 long FTSE position worked well as the market rallied to my 10420 T/P level and I am now flat. Today, I will again be a buyer on any dip lower to 10230/10310 with a lower 10145 ‘Closing Stop’. If I am taken long, I will have a T/P level at 10380.
Dow Rolling Contract
My Dow plan worked well as the market rallied to my 51880-sell level before trading lower to my revised 51740 T/P level and I am now flat. The Dow has short-term resistance from 52030/52330 where I will again be a seller with a higher 52605 ‘Closing Stop’. If I am taken short, I will have a T/P level at 51740. I still do not want to be long the Dow at this time.
Cash NASDAQ 100
My NDX plan worked well as the market rose to my 30580-sell level before trading lower to my 30290 T/P level and I am now flat. Today, I will again be a seller from 30300/30500 with a lower 30705 ‘Closing Stop’. If I am taken short, I will have a T/P level at 30060. I still do not want to be long the NDX at this time.
December BUND
I am still flat as the Bund never came close to Monday’s buy range. Today, I will raise my buy level to 124.90/125.70 with the same 124.15 ‘Closing Stop’. If I am taken long, I will have a T/P level at 126.30.
Gold Rolling Contract
Gold followed Silver lower overnight. In the past few minutes Gold has hit my 4116-buy level. I will add to this position at 4020 with a now lower 3945 ‘Closing Stop’. I will also lower my T/P level to 4195. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Silver Rolling Contract
Silver was heavy for all of Monday’s trading session before getting slammed overnight and is lower by over 4% as I go to post. This sell-off saw my buy range triggered for a now 64.00 long position. I will add to this position at 61.50 while leaving my 59.95 ‘Closing Stop’ unchanged. I will now lower my T/P level to 65.90. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
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