U.S. Indices finished Monday day in a sea of red (SPX -0.8%, NDX -0.8%, RUT -1.6%) amid the continued trade tensions with the US and its trading partners. As it stands, the trade uncertainty is to remain, with US President Trump to sign an EO to extend the July 9th trade deadline to August 1st. US Treasury Secretary Bessent said if no trade deal is reached with partners who have received letters, they will revert to April 2nd tariffs, effective August 1st. Currently, it is known that the US has sent trade letters to Japan, South Korea, Kazakhstan, Laos, South African, Malaysia, and Myanmar, with tariffs levels on said countries ranging from 25-40%, albeit the tariff levels on the countries announced are pretty much less than or equal to the tariffs announced on “Liberation Day”. Similar to Vietnam, the US is to impose tariffs on transhipped goods from said Asian countries while responding to any higher tariff retaliation measure with an additional tariff equal to what was announced today. Meanwhile, Trump threatened that countries that align with the anti-American policies of BRICS will be charged with an additional 10% tariff. Sectors closed mostly in the red, with losses led in Consumer Discretionary, Energy, and Materials, while Utilities solely outperformed in the green. Weighing on Discretionary was downside in Tesla (TSLA, -6.8%) after Musk maintained his stance against Trump, after launching the “America Party”. Following the trade announcements via Trump on Truth Social, immediate risk-off was seen across equities, with the Dollar and Treasuries gaining. The T-Note upside proved short-lived, with the downtrend in the curve remaining while Dollar strength held. In crude, prices rallied higher as the higher-than-expected Saudi OSPs increase outweighed the larger-than-expected OPEC+ hike over the weekend, and Reuters sources report that a likely similar output hike is seen in September. Elsewhere, Oil closed higher by 1.37% while Gold was flat following another volatile trading session.
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 300 points yesterday and is now ahead by 610 points for July after closing June with a gain of 3530 points, 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 0.79% lower at a price of 6229.
The Dow Jones Industrial Average closed 422 points lower for a 0.94% loss at a price of 44,406.
The NASDAQ 100 closed 0.79% lower at a price of 22,685.
The Stoxx Europe 600 Index closed 0.40% higher.
This Morning, the MSCI Asia Pacific closed 0.4% lower.
This Morning, the Nikkei closed 0.35% higher at a price of 39,725.
Currencies
The Bloomberg Dollar Spot Index closed 0.37% higher.
The Euro closed 0.62% lower at $1.1701.
The British Pound closed 0.41% lower at $1.3593.
The Japanese Yen fell 1.18% closing at $146.20.
Bonds
U.K.’s 10-Year Gilt closed 2 basis points higher at 4.59%.
Germany’s 10-Year Bund Yield closed 4 basis points higher at 2.61%
U.S.10 Year Treasury closed 4 basis points higher at 4.39%.
Commodities
West Texas Intermediate crude closed 1.37% higher at $67.41 a barrel.
Gold closed 0.19% lower at $3329.10 an ounce.
This morning on Economic front we already had the release of German May Trade Balance which came in at EUR 18.4 Billion versus 15.5 Billion expected. Next, we have the U.S. NFIB Small Business Optimism Index at 11.00 am. Finally, we have the New York Fed one-year consumer inflation expectations at 4.00 pm and a Three-Year Treasury Auction at 6.00 pm.
Cash S&P 500
The S&P retreated from Thursday’s all-time closing high as President Trump announced the tariff rates that will take effect for several countries, including Japan and South Korea, at 25% on August 1. Individual investors can choose to believe what they like on the topic of tariffs and if they think he is negotiating or not and will once again chicken out. Unfortunately, that is the danger of things, given the President’s past handling of these trade deals, investors believe he will follow suit. The risk is that he won’t chicken out, and the tariffs stick and the truth is that no one knows. Anyway, the stock market reacted as it should, and whether the declines build or not will depend on investors’ beliefs, but perhaps more importantly, how the algorithms respond. For now, the S&P 500 is above the 10-day exponential moving average, and until that moving average is broken, there is not much else to say if you are looking for lower prices. Not surprisingly, we saw both realised and implied volatility rise on the day. We will have to see how things unfold. If the movement intensifies and realised volatility starts rising more rapidly than implied volatility, then things could get interesting. The Dollar appears to be in the process of potentially bottoming here, as it makes a higher low on the RSI while making a lower low on the price chart. The Dollar Index also rose above its 10-day exponential moving average today, suggesting that a significant Dollar reversal may be on the verge of occurring. The trend lines around 98.25 are the next major test. Frustratingly the S&P missed Monday’s 6270 initial sell level with a 6268 high print before selling off to a low at 6201. Subsequently, the S&P rallied 30 Handles into the close and is trading at 6235 as I go to post. Today, I will lower my sell level to 6260/6280 with a lower 6301 ‘Closing Stop’. I still do not want to be long the S&P at this time especially as the Fear & Greed Index closed at 75 last night which is a reading of ‘Extreme Greed’. If I am taken short, I will have a T/P level at 6238.
EUR/USD
The Euro finally traded lower to my 1.1690 T/P level on last week’s 1.1770 average short position and I am now flat. This morning the Euro is trading higher at a price of 1.1740. The Euro has further resistance from 1.1760/1.1830 where I will be a seller with a higher 1.1905 ‘Closing Stop’. If I am taken short, I will have a T/P level again at 1.1690. I still do not want to be long the Euro at this time.
Dollar Index
No Change: There remains zero confidence in the Dollar which continues to trade near its year-to-date low at 96.62 at a price of 97.35 this morning. If we get clarity on tariffs then we should get some confidence and the Dollar should rally. The Daily Chart is certainly set up for that given how oversold the market is. I am still long at an average rate of 97.40 with the same 98.00 T/P level. I will leave my 96.35 ‘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
I am still flat as the Russell just missed yesterday’s 2200 initial buy level by one point before having a small rally overnight. I will not chase the market higher as I continue to be a buyer on any dip lower to 2120/2200 with the same 2065 ‘Closing Stop’. If I am taken long, I will have a T/P level at 2265.
FTSE 100
The FTSE continues to trade sideways close to all-time highs. Volume is low not helped by the ongoing political mess in the U.K. I will not chase the FTSE lower as I continue to be a strong seller from 8850/8920 with the same 8985 ‘Closing Stop’. If I am taken short, I will have a T/P level at 8780. I still do not want to be long the FTSE at this time.
Dow Rolling Contract
My Dow plan worked well as the market rallied to my 44850 Sell level before falling 600 points. This move lower saw my 44630 T/P level triggered and I am now flat. This morning, the Dow is trading at a price of 44400 as I go to post. The Dow has short-term resistance from 44720/44970 where I will be a seller with a lower 45205 ‘Closing Stop’. If I am taken short, I will have a T/P level at 44530. I still do not want to be long the Dow at this time.
Cash NASDAQ 100
Frustratingly the NDX missed Monday’s 22580 T/P level by five points before rallying to sit at 22735 this morning. I am still short at an average rate of 22750 with the same 23005 ‘Closing Stop’. I will now raise my T/P level on this position to 22640. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
December BUND
I am still flat the Bund which is opening lower this morning at a price of 129.90. I will now lower my buy level slightly to 128.80/129.60 with a lower 128.15 ‘Closing Stop’. If I am taken long, I will have a T/P level at 130.20. Despite how low Bund Yields are trading I still have no interest in shorting the Bund at this time.
Gold Rolling Contract
Gold hit a low at 3297 yesterday afternoon before rallying to close at 3329 and sits just above this level as I go to post. I will now raise my buy level to 3270/3290 with a higher 3255 ‘Closing Stop’. If I am taken long, I will have a T/P level at 3313.
Silver Rolling Contract
Silver continues to trade sideways near its high for the year as the market tries to work off some of its severely overbought condition. Today, I will raise my buy level to 35.05/36.05 with a higher 33.95 ‘Closing Stop’. If I am taken long, I will have a T/P level at 36.90.
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