U.S. Equity Markets reversed afternoon losses to close higher, led by the 1.32% rally in the NASDAQ 100. U.S. stocks trended higher due to a decline in bond yields – as investors purchased shares of high-growth companies after recent declines. Because of this, some experts believe the Federal Reserve may not increase interest rates as aggressively as initially thought. Even so, concerns about global supply chains and the broader growth outlook remain. With China’s ongoing lockdowns and Russia’s invasion of Ukraine, many fear that growth could slow over the course of the year. Earnings season really ramps up this week. There are 175 S&P 500 Index members and 13 of the 30 Dow Jones Industrial Average companies releasing results. In a few days, we will know how much rising inflation has crushed corporate earnings. The technology sector will be the stand-out group. Last week, we heard from streaming-video giant Netflix (NFLX) and the numbers were not great. The company lost subscribers and guided for an even worse scenario in the second quarter. Management noted the tailwinds created by the coronavirus pandemic obscured reality. But the real tell about the market’s future will come when we see the numbers from these tech giants… Alphabet (GOOGL), Amazon (AMZN), Apple (AAPL), Meta Platforms (FB), and Microsoft (MSFT) all release results this week. Their stocks all soared as demand was pulled forward during the pandemic. Inflation and a return to normal might be a one-two punch to that demand. We’ll see. Currently, tech stocks make up 28% of the S&P 500 and 49% of the Nasdaq Composite Index. A rally in the big tech names will drive those Indexes higher while a selloff will fuel downside in the recent stock market rout. The earnings outcome for large-cap tech stock this week will determine the near-term direction for the S&P 500 and Nasdaq …Within the S&P 500, six of the 11 sectors finished higher. European Markets closed lower. Russian President Vladimir Putin is said to see no hope in a diplomatic resolution to the Ukraine conflict and is instead seeking to control as much territory as possible. European Central Bank President Christine Lagarde said raising interest rates will not help contain increasing energy costs, signalling it will lag the U.S. in tightening monetary policy. German Finance Minister Christian Lindner said the risk of stagflation is real as inflation is rising rapidly just as economic output is slowing. French President Emmanuel Macron looked set to win a second term as president, bringing a sense of political stability to Europe’s second-largest economy. In Asia, Bank of Japan Governor Kuroda Haruhiko said the central bank will stick with its current easy-money policies until it reaches its 2% inflation target. The steady rise in yields fuelled investors’ rotation out of riskier emerging market bonds into the relative safety of developed market sovereign bonds. The Chinese capital of Beijing imposed social-distancing restrictions in several districts and ordered mandatory COVID-19 testing after infections rose over the weekend. The Chinese city of Shanghai remained under strict lockdown orders after reporting more than 23,000 new COVID-19 infections. Elsewhere, Oil fell a further 3% after China expanded lockdowns, while Gold closed 1.76% lower on further Dollar strength.
To mark my 2525th 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 440 points yesterday and is now ahead by 2217 points for April after closing March with a gain of 5883 points. The Platinum Service made an impressive 5324 points gain in February, after ending January with a gain of 3878 points, more than making up for December’s 932 points loss, 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, after ending March with an impressive gain of 3769 points. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 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 0.57% higher at a price of 4296.
The Dow Jones Industrial Average closed 238 points higher for a 0.70% gain at a price of 34,049.
The NASDAQ 100 closed 1.32% higher at a price of 13,533.
The Stoxx Europe 600 Index closed 1.2% lower.
Yesterday, the MSCI Asia Pacific Index fell 1.3%.
Yesterday, the Nikkei closed 1.90% lower at a price of 26,590.
Currencies
The Bloomberg Dollar Spot Index closed 0.7% higher.
The Euro closed 0.7% lower at $1.0715.
The British Pound closed 0.8% lower at 1.2738.
The Japanese Yen rose 0.3%, closing at $128.14.
Bonds
Germany’s 10-year yield closed 12 basis points lower at 0.85%.
Britain’s 10-year yield closed 12 basis points lower at 1.85%.
US 10 Year Treasury closed eight basis points lower 2.82%.
Commodities
West Texas Intermediate crude closed 3% lower at $98.59 a barrel.
Gold closed 1.76% lower at $1901.10 an ounce.
This morning on the Economic Front we have no data of note from either the U.K. or the Euro-Zone. At 1.30 pm we have U.S. Durable Goods Orders. Finally, we have New Home Sales and Consumer Confidence at 3.00 pm.
Cash S&P 500
I highlighted yesterday morning the importance of the 13200 level in the NDX and the key 4210/4240 support level in the S&P which both held before having a nice rally into the New York close. The previous three- months have seen rallies into month-end and the big question are we going to see something similar into Friday. There is no doubt the last few days have been challenging but given the amount of points we have made this year we can afford to me flexible with our positions. The S&P hit my second buy level at 4230 for a now 4330 average long position. I will now lower my exit level to 4315, take my medicine and try and re-position at a lower price for a run into month-end. If I manage to exit at 4315, I will again look to buy the S&P from 4255/4275 with a no stop. If I am taken long at this range I will have a T/P level at 4305. I still do not want to be short the S&P at this time.
EUR/USD
The Euro got hit hard yesterday, trading the whole of my buy range for a now 1.0740 average long position. I will now lower my T/P level on this trade to 1.0770 while leaving my 1.0635 stop unchanged.
March Dollar Index
My latest short 101.05 short position was stopped out at 101.65 and I am still flat. The Dollar is severely overbought and due a correction. The Dollar has further resistance from 102.00/102.50 where I will again be a seller with a tight 102.05 stop.
Cash DAX
The DAX again proved yesterday that we are seeing plenty of buyers on dips. I was stopped out of Friday’s 14110 long position at 13995. Subsequently, the DAX made an intra-day low at 13852 before rallying over 200 points into the New York close. Today, I will again be a buyer from 13850/13930 with a tight 13785 stop.
Cash FTSE
My FTSE plan worked well with the market trading the whole of my buy range for a 7380 average long position before rallying to my 7420 revised T/P level as emailed to my Platinum Members and I am now flat. Today, I will again be a buyer on any dip lower to 7310/7370 with a 7255 stop.
Dow Rolling Contract
In contrast to Friday, my Dow plan worked well yesterday with the market trading lower to my 33450 buy level before rallying over 600 points into the close. This move higher saw my 34745 T/P level filled and I am now flat. The Dow has short-term resistance from 34220/34420 where I will be a small seller with a tight 34575 stop. The Dow has support from 33750/33500 where I will be a strong buyer with a 33345 stop.
Cash NASDAQ 100
My NDX plan worked well yesterday with the market trading lower to my second buy range at 13200 before rallying to my 13420 T/P level on this portion. I am still long from early this month at 14327 which I will continue to nurse until I see a better opportunity to exit. Today, I will again be a buyer on any further dip lower to 13150/13350 with no stop for now.
June BUND
The Bund rallied to my 153.70 T/P level on Friday’s latest 153.10 long position and I am still flat. Today, I will again be a buyer on any dip lower to 153.10/153.70 with a 152.45 tight stop.
Gold Rolling Contract
Gold got hit hard yesterday, trading the whole of my buy range for a now 1907 average long position. I will leave my 1889 stop unchanged while lowering my T/P level to 1913.
Silver Rolling Contract
No Change. I am still long at 24.30 with the same 23.45 stop. If I am stopped out of this position I will look to buy Silver from 22.50/23.20 with a 21.95 stop. I will leave my 24.61 T/P level on my original position. If I am taken long a second time I will have a T/P level at 23.80.
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