U.S. Indices closed ultimately closed Monday’s session in the green with the NASDAQ leading the gains as outperformance in the Tech sector kept Indices bid once cash equity trade was underway. The majority of sectors were green, but there was clear outperformance in Energy and Tech. Energy stocks were supported by a revival in oil prices, largely sparked by geopolitical escalation over the weekend. Ukraine struck Russian bombers with drones well inside Russia, meanwhile, Iran said the US proposal for a nuclear deal is “imaginary”. However, reports in late trade via Axios suggested the US would allow limited, low-level uranium enrichment. On the supply side, the OPEC 8 agreed to hike production by 411k BPD over the weekend, as was widely expected last week, but also there had been reports there would be discussions for a larger output increase, albeit this did not come to fruition. T-Notes were lower across the curve in a steeper fashion with the increased trade uncertainties bolstering term premium (back and forth US/China commentary, Trump and Xi to speak this week; Trump raising steel and aluminium tariffs; Trump reportedly requesting a “best offer” from nations by Wednesday). T-Notes did bounce in the wake of the data, which saw a weak ISM Manufacturing PMI report and weak Construction Spending. However, the upside faded once the Atlanta Fed updated their Q2 GDP model, which saw a chunky revision higher to 4.6% from 3.8%, seeing the earlier strength reverse with T-Notes settling around lows. Also, Fed’s Goolsbee (2025 voter) was warning the soft inflation prints seen so far may be the last before the tariff impact of tariffs kicks in. In FX, the Dollar was sold on trade uncertainties while antipodes were supported by the turnaround in US equities, as well as firmer base metal prices on Trump’s tariff lift on steel and aluminium. Fed Member Goolsbee spoke on inflation, noting that so far they have had excellent inflation reports and surprisingly little direct impact of tariffs, although he does not know if that will remain true in the next 1-2 months. The Chicago Fed President still thinks that underneath all the tariff ‘dirt in the air’, rates can come down over 12-18 months. He also still believes that if they can get past this bumpy period, the Fed’s dual mandate looks pretty good. He also noted that he is a little “gun-shy” about arguing that tariffs will have a transitory effect on inflation, warning the recent PCE inflation print may have been the ‘last vestige’ of pre-tariff impact. The US ISM Manufacturing PMI for May fell to 48.5 from 48.7, and beneath the expected 49.5. Prices paid marginally dipped to 69.4 from 69.8, while new orders and employment both remained in contractionary territory but ticked higher to 47.6 (prev. 47.2) and 46.8 (prev. 46.5), respectively. Inventories fell beneath 50 to 46.7 from 50.8, while production, supplier deliveries, and backlog of orders rose. New export orders and imports tumbled to 40.1 (prev. 43.1) and 39.9 (prev. 47.1), respectively. Within the respondents comments, once again, many noted the impacts of tariffs with one saying, ““Government spending cuts or delays, as well as tariffs, are raising hell with businesses. No one is willing to take on inventory risk”. On the data set, Pantheon Macroeconomics notes manufacturing is muddling through tariff-related disruptions for the time being rather than falling apart, but the sector remains under intense pressure, with marked increases in the prices of many goods likely in the pipeline. Overall, survey data continues to disappoint but it is yet to be seen whether it will filter through to the hard data remains to be seen. U.S. Construction Spending declined by 0.4% in May, adding on to the 0.8% decline seen in April (revised down from -0.5%), well beneath the analyst consensus of +0.3%. On a Year-to-Date basis, construction spending amounted to USD 660.2 billion, 1.4% above the USD 651.3 billion for the same period in 2024. Private construction fell 0.7% M/M, with residential -0.9%, and nonresidential construction -0.5%. Public construction, however, rose 0.4%, with educational construction -0.1%, with highway construction +0.5%. Following the report, analysts at Oxford Economics noted that “The baseline forecast has already anticipated meaningful weakness in residential investment and business structures investment in Q2”. OxEco explains that construction outlays feed into GDP primarily via residential investment and business structures investment. The consultancy expects residential investment to decline by 2.8% annualised in Q2, representing a 0.1ppt drag on Q2 growth. Elsewhere, Oil closed 2.85% higher while a weaker Dollar saw Gold end Monday with a gain of 2.2%.
To mark my 3200th 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 820 points yesterday on the first Trading Session for June, 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 0.41% higher at a price of 5935.
The Dow Jones Industrial Average closed 35 points higher for a 0.08% gain at a price of 42,305.
The NASDAQ 100 closed 0.71% higher at a price of 21,491.
The Stoxx Europe 600 Index closed 0.07% lower.
This Morning, the MSCI Asia Pacific closed 0.8% lower.
This Morning, the Nikkei closed 0.09% higher at a price of 37,505.
Currencies
The Bloomberg Dollar Spot Index closed 0.62% lower.
The Euro closed 0.7% higher at $1.1436.
The British Pound closed 0.71% higher at $1.3534.
The Japanese Yen rose 0.9%% closing at $142.64.
Bonds
England’s 10-Year Gilt closed 6 basis points lower at 4.68%.
Germany’s 10-Year Bund Yield closed 2 basis points lower at 2.54%
U.S.10 Year Treasury closed 2 basis points lower at 4.45%.
Commodities
West Texas Intermediate crude closed 2.85% higher at $62.52 a barrel.
Gold closed 2.2% higher at $3375.10 an ounce.
This morning on the Economic Front we have Euro-Zone CPI and the Unemployment Rate at 10.00 am. This is followed by U.S. Durable Goods Orders and the JOLTS Job Openings at 3.00 pm. Finally, we have speeches from Fed Members Goolsbee, Cook and logan at 5.45 pm, 6.00 pm and 8.30 pm respectively.
Cash S&P 500
Despite the fact that we are in probably the noisiest news environment any of us ever experienced in history and that is saying a lot for many of us who have seen it practically all. And the newsflow is not only intense it is also regularly market impacting. Instantaneously. Yes, we saw it again on Friday when Trump came out with his increased Steel Tariffs, driving the S&P to a low of 5844 before rallying 70 Handles off this low into the close. May turned out to be the best Monthly gain for the S&P since 1990 yet Macro Hedge Funds have had their worst start to a trading year on record. The technical signals have won out since the April 7 lows, resulting in one of the largest short-term rallies in history. First off, as far as control is concerned, bulls are clearly again in charge here as all the key Moving Averages’ have been recaptured, i.e. the monthlies on that May close of 5912. As long as this remains the case bulls have a shot at new highs. Full stop. Bears have so far failed in producing a reversal back below the key Moving Averages’. Presently, as shown by the $NYSI that are overbought enough where a rollover could happen, especially since we have no evidence of new highs yet either, so on that basis even the retest case of the lows cannot be taken off the table yet. I have said when Trump was elected that two-way price would return in spades and this is exactly what has happened which is great news for ‘Day Trading’. With every passing week of no confirmed roll over below the key Moving Averages’ the odds are rapidly decreasing of a sustained sell-off. So perhaps in context then of last Friday’s Monthly close, this is critical for if bears cannot force a key reversal below the Moving Averages’ then bulls have an open door for new highs. After all June and July are not exactly bearish months historically speaking, although it can happen of course. Thursday’s 5990 short position worked well as the market sold off to my 5965 T/P level shortly after I posted. Subsequently, I emailed my Platinum Members to buy the S&P which I did at a price of 5853 before the market rallied to my 5892 T/P level and I am now flat. This morning, the S&P is trading at a price of 5912 – 20 Handles below last night’s Chicago close. The S&P has short-term support from 5850/5870 where I will again be a buyer with a 5835 ‘Closing Stop’. My only interest in selling the S&P is from 5985/6005 with a 6021 ‘Closing Stop’.
EUR/USD
The Euro is trading 150 points higher from where I marked prices on Thursday. The Dollar continues to weaken despite the recovery in equity markets. The Euro has short-term resistance from 1.1480/1.1560 where I will be a seller with a 1.1635 ‘Closing Stop’. My only interest in buying the Euro is on a large move lower to 1.1100/1.1180 with the same 1.1035 ‘Closing Stop’. If I am taken long, I will have a T/P level at 1.1250. If I am taken short, I will have a T/P level at 1.1420.
Dollar Index
The weakness in the Dollar saw the whole of Thursday’s buy range triggered for a now 99.10 average long position. I will now lower my T/P level to 99.50 while leaving my 98.25 ‘’Closing Stop’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Russell 2000
Monday’s sell-off saw the Russell hit my buy range for a now 2040 long position. I will add to this position on any further move lower to 1980 while leaving my 1925 ‘Closing Stop’ unchanged. I will now lower my T/P level to 2075. 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 the market just fell shy of Thursday’s 8820/8890 sell range. This morning, the FTSE is trading at 8797 as I go to post. Today I will continue to be a seller from 8820/8890 with the same 8945 ‘Closing Stop’. I still do not want to be long the FTSE at this time. If I am taken short, I will have a T/P level at 8765.
Dow Rolling Contract
Thursday’s 42670 short position worked well as shortly after I posted the Dow traded lower to my 42440 T/P level and I am now flat. The Dow has resistance from 42600/42850 where I will again be a seller with a lower 43105 ‘Closing Stop’. I still do not want to be long the Dow at this time.
Cash NASDAQ 100
After both the S&P and Dow had hit my T/P levels on Thursday I emailed my Platinum Members to exit my 21470 short position for a small loss at 21520 and I am now flat. This was the wrong call as subsequently the NDX fell a further 500 points before leading Monday’s session higher. With the Dollar so far getting no respite from the strength in the Equity Markets I find it difficult to be long the NDX at current prices. The NDX has short-term resistance from 21600/21800 where I will again be a seller with a 21905 tight ‘Closing Stop’. If I am taken short, I will have a T/P level at 21450.
December BUND
I am still flat as the Bund has traded in a narrow range since Thursday. Today, I will continue to be a buyer on any dip lower to 129.50/130.30 with the same 128.75 ‘Closing Stop’. If I am taken long, I will have a T/P level at 131.10. I still do not want to be short the Bund at this time.
Gold Rolling Contract
I still do not like the price action in Gold, especially with the market trading $100 higher from where I last marked prices on Thursday morning. Gold has short-term resistance from 3450/3475 where I will be a small seller with a 3501 ‘Closing Stop’. If I am taken short, I will have a T/P level at 3420.
Silver Rolling Contract
Unfortunately, Silver just missed Thursday’s buy level by 18 points before rallying over 190 points, sitting at a price of 34.25 this morning for a nearly 5% rally. Siver hit a new high for the year at 34.90 overnight. I will now raise my Silver buy level to 32.90/33.80 with a higher 31.95 ‘Closing Stop’. If I am taken long, I will have a T/P level at 34.60.
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