U.S. Equity Markets ended Monday’s session mixed following another volatile trading session. Notable outperformance in Tech stocks offset losses across most of the other sectors. It was surprising that the NASDAQ outperformed given the surge in Bond Yields and the U.S. Dollar. 10-Year Treasuries closed at a new 16-year high at 4.69% following stronger than expected ISM data.This week marks the start of the final and arguably most important quarter of the year for markets. The third quarter saw a fall back in gains during the first half of the year with the S&P 500 falling about 3.6%, the Dow Jones dropping 2.6%, and the tech-heavy Nasdaq shed 4.1%. Bond yields have continued to surge as the Federal Reserve continue to hint that rates could still inch higher and that any rate cuts are not in the forecast anytime soon. The final quarter of 2023 could shape up to be a tell-tale sign for investors of what is to come in 2024. Friday’s U.S. Jobs Report for September is expected to reveal a stable labour market, with the Unemployment Rate remaining unchanged at 3.8%. Before Friday’s upcoming report, investors will get a glimpse into the labour landscape with the release of the JOLTS jobs report for August, followed by the ADP National Employment report. Any surprises in either direction could hold significant sway with the Fed as they determine the possibility of one final rate hike in November. This week features several speeches from major central bank figures, starting on Monday with Fed Chair Jay Powell and Philadelphia Fed President Patrick Harker. Both Fed officials will sit down with workers and small business owners to discuss the state of the economy. Recent data suggests progress in inflation, but rising oil prices hint at a prolonged journey to reach the Fed’s 2% target. On the European front, ECB President Christine Lagarde will speak on Wednesday with investors looking for any signs that the central bank may pause rate hikes after inflation fell to the lowest level in two years in September. European Markets closed lower as Bund Yields surged above 2.90%. In Asia, Australia and New Zealand, central banks will hold policy meetings this week, and it is anticipated they will keep interest rates unchanged. Analysts are on the lookout for any indications about potential future rate hikes. On Friday, the FAO Food Price Index will provide a global view of food inflation. Meanwhile, the major earnings highlight on Wall Street for the week is consumer goods company McCormick (MKC) reporting on this afternoon before the market opens. Elsewhere, Oil 2.17% lower while a stronger Dollar saw Gold fall a further 1.2% lower.
To mark my 2875th 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 lost 205 points on the first trading session for October after closing September with a small gain of 228 points, after finishing August with 1485 points gain following a small gain of 285 points gain in July, after closing June with a gain of 2683 points. May closed with a gain of 3205 points. April saw a gain of 3354 points while March closed with a gain of 6168 points. The Platinum Service made 3164 points in February, 4687 points in January 2054 points in December, 4789 points in November and a record 9619 points last October. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1900 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% higher at a price of 4289.
The Dow Jones Industrial Average closed 74 points lower for a 0.22% loss at a price of 33,433.
The NASDAQ 100 closed 0.83% higher at a price of 14,837.
The Stoxx Europe 600 Index closed 1.03% lower.
This morning, the MSCI Asia Pacific closed 0.8% lower.
This morning, the Nikkei closed 1.64% lower at a price of 31,237.
Currencies
The Bloomberg Dollar Spot Index closed 0.73% higher.
The Euro closed 0.8% lower at $1.0480.
The British Pound closed 0.8% lower at 120.92.
The Japanese Yen fell 0.3% closing at $149.93.
Bonds
Germany’s 10-year yield closed 7 basis points higher at 2.92%.
Britain’s 10-year yield closed 7 basis points higher at 4.53%.
U.S.10 Year Treasury closed 11 basis points higher at 4.69%.
Commodities
West Texas Intermediate crude closed 2.17% lower at $88.82 a barrel.
Gold closed 1.2% lower at $1829.10 an ounce.
This morning on the Economic Front we have no data of note from either the U.K. or the Euro-Zone. The only U.S. data of note is the JOLTS Job Openings which will be released at 3.00 pm.
Cash S&P 500
October got off to a negative start as Bond Yields continue to defy gravity, making new highs almost on a daily basis over the past month. The vertical rally in Bond Yields will reverse but the key is from what level. Despite 10-year Treasuries hitting 4.70% yesterday I am seeing plenty of negative divergences suggesting an upcoming rally. If we do not see a reversal in Yields this month then the odds of new lows and a down month are very high. The key support level for October is 4200. The Japanese continue to moan about the strong Dollar causing havoc overseas but talk will not fix this problem, meaning they need to intervene. USD/JPY is trading at 149.75 this morning which is well above the level that they intervened last October. The market is daring the BOJ to intervene and I suspect they will have to blink soon as the situation is becoming untenable. This situation remains one of the unpredictable variables in the market which could change the currency equation on a dime and break the Dollar pattern. Were this to happen it would quickly put a floor in the S&P. My S&P plan worked well yesterday as the market traded the whole of my buy range for a 4286 average long position before rallying to my 4298 T/P level. With the $BPSPX 14 Day RSI closing at an unprecedented 12, I emailed my Platinum Members that I had bought the S&P again at 4289. I am still long and I will add to this position at 4274 with a wider 4259 ‘’Closing Stop’’. I will have a T/P level at 4306 on this position. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
EUR/USD
The Euro got hit hard yesterday, closing lower by 0.8%. This move lower saw the whole of my buy range triggered for a now 1.0510 average long position. The 14-Dat RSI closed at an oversold 28 while the Daily Sentiment Index is still in single digits. I will now lower my T/P level to 1.0575 while leaving my 1.0425 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
September Dollar Index
The Dollar surged yesterday, trading the whole of my sell range for a now 106.75 average short position. This morning the Dollar is trading higher at 107.06. I will leave my 107.55 ‘’Closing Stop’’ unchanged while raising my T/P level to 106.40.
Cash DAX
I am glad I did not chase the DAX yesterday as the market got hit hard once the U.S. Cash Indexes opened. This move lower saw the whole of my buy range filled for a now 15245 average long position. I will leave my 15135 ‘’Closing Stop’’ unchanged while lowering my T/P Level to 15275.
Cash FTSE
The FTSE also traded the whole of Monday’s buy range for a now 7530 average long position. I did not expect such an aggressive sell-off in FTSE. However, higher Gilt Yields and a severely weakened Pound are weighing on the FTSE. I will now lower my T/P level on this position to 7560. I will leave my 7445 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dow Rolling Contract
Wrong! I carried my September 33910 long Dow position into October. Yesterday’s move lower saw this position stopped at 33460. Subsequently, I emailed my Platinum Members to buy the Dow again which I did after the close at 33425. I am still long and I will now add to this position at 33225 with a 33095 ‘’Closing Stop’’. I will have a 33610 T/P level on this position. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash NASDAQ 100
My NDX plan worked well as the market traded lower to my 14700-buy level before rallying to my revised 14825 T/P level and I am now flat. This morning the NDX is trading unchanged at 14825. We have support from 14520/14670 where I will again be a buyer with a lower 14395 ‘’Closing Stop’’.
December BUND
The Bund reversed earlier gains to hit my 127.75 buy level. I am still long and I will add to this position on any further move lower to 126.95. I will now lower my T/P level to 128.25 while leaving my 126.35 ‘’Closing Stop’’ unchanged.
Gold Rolling Contract
The weakness in Gold continues. The 14 Day RSI closed last night at an oversold 26 which is no surprise given the fact that Gold has now fallen $150 in a straight line. This move lower saw my buy range triggered for a now 1831 long position. I will now add to this position at 1815 with a now lower 1803 ‘’Closing Stop’’.
Silver Rolling Contract
No Change. I am still long Silver from three weeks ago at 24.05. In a change of strategy, I will have no stop or no T/P level on this position. This morning Silver is trading lower at 21.05. If this view changes, I will be back with a new update for my Platinum Members.
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