U.S. Equity Markets surged the most in fourteen months as investors gained confidence that stewards of the world’s largest economies would act in concert to offset any impact from the spreading coronavirus. The S&P 500 rallied 4.6% after news that Group of Seven Finance Ministers and Central Bankers will hold a teleconference today to discuss how to respond to the outbreak. Tech shares led the rebound after seven straight days of declines for the Benchmark Index, with monetary policy makers from Japan to England joining the Federal Reserve in promising to take action to support their economies if needed. Ten-year Treasury yields pared an early slide to trade little changed, while 30-year rates rose. Oil rallied on expectations that the OPEC+ alliance will deepen output cuts. The stock gains provided hope for investors after last week’s nearly unprecedented rout, even as the S&P 500 Index closed 8.7% below the record it reached just two weeks ago. The Coronavirus has already done severe economic damage — with the OECD warning that growth will sink to levels not seen in more than a decade — but investors are betting that policy makers will take decisive action to limit the pain. Overnight, Australia’s central bank cut rates and signalled it’s prepared to ease further.
To mark my 2000th 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 500 points yesterday on the first trading session for March, having made 2223 points in February, 2142 points in January, 818 points in December, 780 points in November, 1649 points in October, 1620 points in September and 2387 points in August Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
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Equities
European stock futures are higher at the moment after U.S. stocks had the best day since December 2018. Overnight trading was mixed in Asia amid an apparent lack of enthusiasm over the impact of any shift in policy, and as virus cases keep rising. Some strategists, at least, say there’s money to be made in betting everything calms down in stocks, and even last week’s sell off was seen by hedge funds as an opportunity to buy. Things are looking brighter for oil, too, where futures in New York have now recouped almost half of last week’s 16% plunge, with OPEC and its allies expected to deepen production cuts.
The S&P 500 Index rose 4.6%, closing at 3090 which was 200 Handles higher that its intra-day low.
The Dow Jones Industrial Average gained 5.1% for a 1293 point gain to close at 26,703.
The Nasdaq 100 Index advanced 4.9%, closing at 8877.
The Stoxx Europe 600 Index rose 0.1%.
The MSCI Asia Pacific Index climbed 0.8%.
Currencies
Here is a summary of the main Changes in F.X. Markets:
The Bloomberg Dollar Spot Index fell 0.4%.
The Euro increased 1.3% to $1.1163.
The British Pound slid 0.3% to $1.2782.
The Japanese Yen was little changed at 107.90 per dollar.
Bonds
The yield on 10-year Treasuries was little changed at 1.15%.
The yield on two-year Treasuries dipped one basis point to 0.90%.
Germany’s 10-year yield fell two basis points to -0.63%.
Commodities
West Texas Intermediate crude jumped 5.3% to $47.13 a barrel.
Gold rose 0.5% to $1,593.64 an ounce.
This morning on the Economic Front we have Euro-Zone CPI, PPI and the Unemployment at 10.00 am. The only other data of note on either side of the Atlantic is ISM New York Business Conditions Index which will released at 2.45 pm.
March S&P 500
The S&P has seen many days of extreme volatility but in Points terms I have never witnessed what happened yesterday. The S&P traded in a 200 Handle range with the market rallying an incredible 90 Handles in the last 40 minutes to close at 3090. Subsequently after the Cash S&P closed at 9.00 pm, the Futures Market sold of 22 Handles to close at 3068 in the final 15 minutes. I mentioned countless times that there is phenomenal trading opportunities with this wild volatility by trading in small size and only using a mental instead of a physical stop. Yesterday my S&P plan worked well as we traded the whole of my buy range for a 2960 average long position before the market rallied to my too tight 2992 T/P level and I am now flat. With the G7 Finance Ministers and Central Bankers having a teleconference later today I would expect more volatility surrounding any Statement Release. Already we saw the Australian Central Bank cut Interest Rates this morning by 0.25%. The McClellan Oscillator improved from Friday’s record -408 close to finish at a still oversold -254 last night. The S&P has short-term support from 3020/3040 and I will be a buyer in this range with a 2999 mental stop. The S&P has initial resistance from 3135/3155 and I will be a seller here with a 3169 stop. With the VIX closing 17% lower at a still very high 33.42 I would expect two-way volatility to continue until the VIX gets back below 25.
EUR/USD
In my opinion the recent low of 1.0750 for the Euro could be a major bottom. The world and especially Emerging Markets need a weaker Dollar to have any chance of recovering. The Euro has now rallied 400 points since last month’s low. I am still flat and I will now raise my buy level to 1.1030/1.1070 with a 1.0985 stop.
March Dollar Index
No Change as my only interest in selling the Dollar is still from 98.20/98.60 with the same 98.95 stop.
March DAX
As I was already long four Indices I did not buy the DAX yesterday. If you did buy the DAX using a mental stoop then this worked well with the market rallying to trade above 12100 this morning. With so much going on in the other Indices I am going to stay flat the DAX until the markets settle. The fact that the DAX has no official overnight trading is another reason to stay on the sidelines.
March FTSE
Despite a much weaker Pound my 6625 average buy level in the FTSE did not work well as I was stopped out of this trade at 6555 and I am still flat. The FTSE is oversold but at least we are trading back above the bottom of the Daily Bollinger Band while the Williams Index has given a buy signal. Today I will be a buyer from 6600/6660 with the same 6555 stop. If I am taken long I will have a T/P level at 6705.
Dow Rolling Contract
An incredible past 24 hours trading for the Dow as the market moved up and down 150/200 points every 20 minutes on what turned out to be the most volatile trading session in points terms for the Dow in history. At 8.15 pm last night we were trading heavy at 26000 before a late 700 point rally saw the market finish on its highs at 26704. Yesterday after I posted the Dow traded lower to my 25500 buy level before rallying to my too tight 25630 T/P level and I am still flat. So far the key 25000 support area is holding but for this market to turn bullish we need to break and close back above the 200 Day MA which comes in at 27241. Today I will be a small buyer from 26000/26200 with a 25850 mental stop. The Dow has strong resistance from 27130/27280 and I will be a seller in this area with a 27395 stop.
March NASDAQ
The fact that the 200 Day MA held for the NASDAQ is helping the rest of the US Market from crashing. We are now trading 700 points above the 8146 key level after the NASDAQ closed an incredible 400 points higher last night. The NASDAQ has strong resistance from 8950/9050 and I will be a seller in this area with a 9130 stop. I do not want to be long the NASDAQ at this time.
March BUND
The BUND traded the whole of yesterday’s sell range for a now aver short position at 177.80. I will now lower my stop on this position to 178.20. I will raise my T/P level to 177.35 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
Gold Rolling Contract
No Change as I am still a buyer on any dip lower to 1663/1673 with a 1654 stop.
Silver Rolling Contract
My Silver plan worked well with the market trading lower to my 16.65 buy level before rallying overnight to my 16.85 revised T/P level and I am now flat. Silver is trading near seven month lows and today I will be a buyer from 16.00/16.40 with a 15.65 stop.
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