U.S. Indices closed notably in the red Monday and sold off through the duration of the US afternoon, on the broader risk-off theme amid poor US data and President Trump noting tariffs will go ahead. On the former, and potentially heightening US growth concerns, Feb ISM Manufacturing disappointed with the headline underwhelming, driven by employment and new orders plunging below 50, but prices paid soared. In the accompanying comments, many mentioned the uncertainties the looming tariffs are causing. In wake of the data, the latest Atlanta Fed GDPnow forecast sees Q1 at -2.8% from -1.5%, continuing to exasperate the growth fears. Later in the day, US President Trump said reciprocal tariffs start April 2nd and tariffs on Canada and Mexico to start Tuesday, as expected, which saw the Dollar pare off lows while both the Canadian Dollar and Mexican Peso saw notable weakness. Moreover, Trump announced China tariffs are to double 20% on Tuesday. In addition, US indices also sold off, with Treasuries rising to session highs while the Japanese Yen gained. Overall, the Dollar was still notably softer to start the week with all G10 FX peers (ex-CAD) firming against the Buck. As mentioned, Treasuries firmed amid the risk-off tariff trade, albeit already were gaining on poor US data, while the crude complex sold off after Bloomberg reported that OPEC+ will go ahead with the April oil output increase. Note, this was later confirmed by OPEC+. US/Ukraine relations continue to boil with seemingly no imminent improvement of relations, as Trump posted an AP article on Truth titled “Ukraine’s Zelensky says end of war with Russia is ‘very, very far away’”, adding “this is the worst statement that could have been made by Zelensky, and America will not put up with it for much longer”; Zelensky replied on X noting “it is very important that we try to make our diplomacy really substantive to end this war the soonest possible.” Elsewhere, sectors were largely in the red with Tech and Energy the two laggards and the former hit by Nvidia (-8.7%) which even breached its DeepSeek low. For the record, Fed’s Musalem (2025 voter) said his outlook is for continued solid economic growth, but recent consumer and housing data pose some downside risk, and also that is hard to separate weather and confidence from January spending. Ahead, all attention is on if tariffs go into effect on Mexico/Canada at midnight (US time). ISM Manufacturing PMI for February fell to 50.3 from 50.9, and shy of the expected 50.8. Within the breakdown, employment and new orders fell to 47.6 (prev. 50.3) and 48.6 (prev. 55.1), respectively, while prices paid surged to 62.4 (exp. 55.8, prev. 54.9) and outside the top end of the forecast range (54.9). Imports showed modest growth to 52.6 from 51.1, but given the looming tariffs, some expected a much greater rise amid potential front-loading. Production dipped, albeit remaining above 50, while inventories and backlog of orders rose, but still stayed below 50. New export orders grew, but at a slower rate M/M, while supplier deliveries printed 54.5 from 50.9. Within the report, it notes that demand eased, production stabilised, and de-staffing continued as panellists’ companies experienced the first operational shock of the new administration’s tariff policy. Prices growth accelerated due to tariffs, causing new order placement backlogs, supplier delivery stoppages and manufacturing inventory impacts. The report adds, “Although tariffs do not go into force until mid-March, spot commodity prices have already risen about 20%.” In the 10 respondents’ comments, 8 of them mentioned tariffs and the uncertainty they are creating, which gives us an insight into how Cos. are currently thinking given the looming tariffs. Overall, Pantheon Macroeconomics see the manufacturing sector continuing broadly to stagnate over the next few quarters. Meanwhile, Fed Member Musalem said his outlook is for continued solid economic growth, but recent consumer and housing data pose some downside risk. However, the St Louis Fed President said it is hard to separate weather and confidence from January spending. Elsewhere, added restrictive monetary policy is still needed to ensure inflation returns to the 2% target and a patient approach to policy will help achieve the Fed’s goals and sustain economic expansion. He added he would look closely at the behavior of inflation expectations if the Fed’s inflation and jobs goals come into conflict. Expects economy to continue to grow but says he would be concerned about signs of further weaking of consumption or dampening of business confidence. Elsewhere, Oil closed lower by 2.21%, while Gold reversed all of Friday’s move lower with a rise of 2.1%.
To mark my 3150th 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 52 points on the first trading session for March after 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 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 1.76% lower at a price of 5850.
The Dow Jones Industrial Average closed 649 points lower for a 1.48% loss at a price of 43,192.
The NASDAQ 100 closed 2.2% lower at a price of 20,425.
The Stoxx Europe 600 Index closed 1.07% higher.
Yesterday, the MSCI Asia Pacific closed 0.6% higher.
Yesterday, the Nikkei closed 1.3% higher at a price of 37,784.
Currencies
The Bloomberg Dollar Spot Index closed 0.4% lower.
The Euro closed 0.9% higher at $1.0486.
The British Pound closed 0.8% higher at 1.2687.
The Japanese Yen rose 0.4% closing at $149.70.
Bonds
Germany’s 10-year yield closed 9 basis points higher at 2.47%.
Britain’s 10-year yield closed 3 basis points higher at 4.51%.
U.S.10 Year Treasury closed 9 basis points lower at 4.13%.
Commodities
West Texas Intermediate crude closed 2.21% lower at $68.22 a barrel.
Gold closed 2% lower at $2852.10 an ounce.
This morning on the Economic Front we have the Euro-Zone Unemployment Rate at 10.00 am. The only other noticeable evet today is a speech from Fed Member Williams at 2.20 pm.
Cash S&P 500
Frustratingly, the S&P hit a morning high at 5990 – just below my initial 5995 sell level before falling over 150 Handles on the Trump Tariff announcement. This lower move saw the whole of my buy level triggered for a 5907 average long position. Subsequently, I was stopped out of this position at 5881 and I am still flat. It was interesting that despite the aggressive sell-off that the Fear & Greed sentiment indicator improved from Friday’s 16 close to last night’s 23 print. This is still a reading of ‘’Extreme Fear’’ but a significant improvement of Friday’s close. If the S&P continues to sell-off it will attract strong buying at the 5723 level as this is where the 200-Day Moving Average lies. A widely watched indicator by me is the AAII Bearish Readings Index. Monday’s 60.60 print is the highest reading since the 2009 Global Financial Crisis. Once this reading is over 60, history tells us that we are close to a major bottom. I know this sounds irrational given the small sell-off in the S&P from last month’s high but this indicator in my opinion has to be strongly respected. I would love to see the 200 MA tagged but I am not sure we will get it on this run. Today, I will be a buyer of the S&P on any further move lower to 5825/5845 with a wider 5805 ‘’Closing Stop’’. If triggered, I will have a T/P level at 5910.
EUR/USD
My latest average 1.0415 long Euro position worked well as the market rallied to my 1.0470 T/P level and I am now flat. The Euro has support below from 1.0360/1.0440 where I will again be a buyer with the 1.0295 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 1.0495. I still do not want to be short the Euro at this time.
Dollar Index
The Dollar saw noticeable weakness on Monday. This move lower saw my buy level triggered for a now 106.75 long position. I will add to this position on any further move lower to 1.0615 while leaving my 105.65 ‘’Closing Stop’’ unchanged. I will now lower my T/P level to 107.20. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Russell 2000
Wrong. Monday’s late sell-off saw my 2125 stop triggered on last week’s 2180 average long position and I am now flat. This morning, the Russell is trading at a price of 2103 as I go to post. The March 2024 highs should act as strong support for any further sell-off in the Russell. Therefore, I will be a strong buyer from 2040/2100 with a lower 1985 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 2150.
Cash FTSE
My FTSE plan worked well as the market rose to my 8910-sell level before trading lower to my 8840 T/P level and I am now flat. It is incredible that given both the political and economic backdrop that the FTSE and DAX closed at new all-time highs yesterday afternoon before having a small sell-off into the New York close. Today, I will again be a seller of the FTSE from 8900/8970 with a lower 9035 ‘’Closing Stop’’. If triggered, I will have a T/P level at 8835. I no longer want to be a buyer of the FTSE at this time. If this view changes, I will be back with a new update for my Platinum Members.
Dow Rolling Contract
The Dow broke above both its 20 Day Moving Average (43901) and 50 Day Moving Average (43645) with a high above 44000 before falling 800 points in a straight line. Both of these MA’s will now act as strong resistance on any tag. However, with the Fear & Greed signal at 23 I just cannot justify a short position at this time. Monday’s aggressive sell-off saw the Dow trade the whole of my buy range for a now 43450 average long position. I will now lower my stop to a price of 43095 while lowering my T/P level to 43570. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash NASDAQ 100
Shortly after I posted on Monday morning the NDX made an intra-day high at 21070 before falling over 800 points on the Trump tariff announcement. This is a huge move led by the 9% fall in NVIDIA shares which are now trading below the DeepSeek low print from last month. This move lower saw the whole of my buy range executed for a now 20570 average long position. The 200 Day Moving Average is just below at a price of 20211. Given the importance of this key support line I will now lower my ‘’Closing Stop’’ to a price of 20195. The NDX has short-term resistance at 20700. I will now lower my T/P level to this price level. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
December BUND
Treasury Yields have now fallen over 60 basis points in the past 10 days. This is an enormous move and signals how much trouble the American economy is now in. If yields fall much further then the Fed may have no choice but to cut rates at the March meeting despite inflations remaining stubbornly high. Bund Yields rose yesterday which is no surprise given how unattractive they are on a risk/reward basis. The Bund has support below from 131.00/131.80 where I will be a strong buyer with a 130.25 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 132.40.
Gold Rolling Contract
Gold continues to attract large buying on any dip, wiping out all of Friday’s sell-off in a bid only session on Monday. I am still flat. I will now raise my buy level to 2830/2846 with a higher 2817 ‘’Closing Stop’’.
Silver Rolling Contract
No Change: I am still long Silver from last week at an average rate of 31.75 with the same 32.20 T/P level. I will now raise my stop to a ‘’Closing Price of 30.55. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
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