U.S. Equity Markets tumbled to start the week, suffering heavy losses across the board, led by the NASDAQ 100 which closed Monday with a loss of 3.75%. Envoys from Moscow and Kyiv met yesterday for the third time in the past couple of weeks. The two sides are supposedly engaging in discussions about how to end the current conflict in Ukraine. However, it is unlikely any real progress will be made. The White House is reportedly willing to go it alone in banning Russian energy imports, after Germany said such a ban would not be feasible. This should not be surprising… Germany (and all of Europe) is heavily reliant on Russia for its energy supply. Still, a ban on Russian energy would push oil prices even higher, lifting inflation. Late in the day, Russia itself said that it could cut off all energy exports to Europe, further heightening tensions over the energy supply. On inflation, strategists at Credit Suisse said they now see food prices rising 16% in 2022 from the previous year. They had last seen food inflation coming in at about 11%. This could push overall inflation even higher, forcing the Federal Reserve to act more drastically to rein in inflation. The declines again outnumbered the advances in the S&P 500. Airlines weighed on the industrial segment, as surging oil prices mean higher costs and lower margins for these companies. Hershey (HSY) was one of the standouts, after Credit Suisse said its superior pricing power would allow it to navigate high inflation for food. Within the S&P 500, nine of the 11 sectors finished lower. European Markets got slammed. Russian President Vladimir Putin said he will not halt the military campaign in Ukraine until the country agrees to “demilitarise” and the government is removed from office. Russia’s Ministry of Foreign Affairs said domestic companies can make bond payments to overseas holders in Rubles instead of foreign currencies, as a way to avoid default. Euro-Zone Economic Sentiment fell more than expected, dipping into negative territory, as the Ukraine conflict increased the chances of a recession in Eastern European countries. In Asia, Chinese Premier Li Keqiang set an economic-output target of 5.5% for 2022. While this is the lowest level in 30 years, it’s better than analysts’ expectation for 5% or more. Japan’s government was said to be in talks with the U.S. and Europe about banning Russian energy imports, which account for just over 4% of the nation’s supply. China’s government called on various government agencies to use every policy tool possible to ensure a stable economy and steady growth. South Korea’s Ministry of Foreign Affairs said it has decided to cease transactions with the Russian central bank due to the Ukraine invasion. Elsewhere, Oil rose 3.67% as investors digest headlines on a possible ban of Russian crude imports, while Gold jumped 1.70% as investors rotated out of stocks and into safe havens.
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For anyone following my Platinum Service it made 595 points yesterday and is now ahead by 1415 points for March. The Platinum Service made an impressive 5324 points gain in February, after ending January with a gain of 3878 points, more than making up for December’s 932 points loss, having made 2466 points in November, 1028 points in October, 2866 points in September, 1543 points in August, and 996 points in July. The Platinum Service made 1366 points in June, 1439 points in May, 1244 points in April, after ending March with an impressive gain of 3769 points. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 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 2.95% lower at a price of 4201.
The Dow Jones Industrial Average closed 797 points lower for a 2.37% loss at a price of 32,817.
The NASDAQ 100 closed 3.75% lower at a price of 13,319.
The Stoxx Europe 600 Index closed 3.4% lower.
This morning, the MSCI Asia Pacific Index fell 1.2%.
This morning, the Nikkei closed 1.71% lower at a price of 24,790.
Currencies
The Bloomberg Dollar Spot Index closed 0.5% higher.
The Euro closed 0.6% lower at $1.0861.
The British Pound closed 0.9% lower at 1.3120.
The Japanese Yen fell 0.4%, closing at $115.31.
Bonds
Germany’s 10-year yield closed five basis points higher at -0.02%.
Britain’s 10-year yield closed nine basis points higher at 1.30%.
US 10 Year Treasury closed five basis points higher 1.78%.
Commodities
West Texas Intermediate crude closed 3.67% higher at 119.92 a barrel, the highest level since 2008.
Gold closed 1.70% higher at $2,002.10 an ounce.
This morning on the Economic Front we already had the release of German Industrial Production which rose 2.7% versus +0.5% expected. Next, we have Euro-Zone GDP and Unemployment at 10.00 am. This is followed by the U.S NFIB Business Optimism Index at 11.00 am and the Trade Balance at 1.30 pm. Finally, we have Wholesale Inventories at 3.00 pm.
Cash S&P 500
My S&P plan worked well with the market trading lower to my 4244 buy level before rallying 4278 T/P level with a rebound high at 4327, before the market spent the rest of the session in the red. Subsequently, the S&P got slammed into the close, before selling off again overnight to sit at 4160 as I go to press. I bought the S&P a second time at 4233 before the market rallied to my 4246 T/P level and I am now flat. Until last night the S&P was holding in relative to the U.S. Indexes but that trend changed yesterday with the S&P now within last Thursday’s 4105 low print. We are now witnessing our second crash in two years as the world is faced with massive inflation on top while the Central Banks are ‘’all in’’ with the ECB still in crisis mode and negative Interest Rates to boot. All diplomatic efforts to end the war have yielded exactly zero results. The Russian Economy is on the verge of imploding while Energy prices are exploding with WTI trading at $123 a barrel this morning. None of this is sustainable in the long haul without causing a massive recession. The ‘’Fear & Greed ‘’ Index closed with a reading of 13 last night which is ‘’Extreme Fear’’. The S&P is trying to rally as I post this morning. We have support from 4120/4160 where I will again be an aggressive buyer with no stop. If I am taken long I will have a T/P level at 4198. Given how oversold the markets are trading, I do not want to be short the S&P at this time.
EUR/USD
The Euro traded lower to my second buy level at 1.0850, for a now 1.0886 average long position. I will now lower my T/P level to 1.0930 and if any of the above levels are hit, I will come back with a new update for my Platinum Members.
March Dollar Index
My Dollar plan did not work out as I was stopped out of my 97.30 short position from last Friday at 99.05. This morning the Dollar is trading at 99.20 and I have gone short again in small size at this level with a 100.05 stop. The Dollar is severely overbought and is due a retracement. I will have a T/P level on this position at 98.40 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
Cash DAX
One of the scariest trading sessions in many years, as Nickel exploded over 80% yesterday while European Natural Gas finished Monday with a gain of 75%. There was zero good news on any front and this was reflected in the late sell-off in Global Indexes into the New York close. This is insane and if the authorities do not get a handle on this within a number of days then a recession is all but guaranteed. The DAX closed 20% below its 200 Day Moving Average. The DAX has now crashed and I am not saying we cannot fall further, but the flip size to this is a massive ‘’V’’ rally on any sign of progress in Ukraine. The bright spot is the DAX is trading slighter higher this morning from where I marked prices 24 hours ago. I know we did see a 600 point rally to a rebound high at 13150 before this rally got sold again into the New York close. I am still long at a price of 13500. I will add to this trade at 12700 with no stop. If I am taken long at 12700, I will have a T/P level at 13150 and if any of the above levels are hit I will be back with a new update for my Platinum Members.
Cash FTSE
The FTSE hit my second buy level at 6810 for a now 6985 average long position. Frustratingly, the FTSE’s rally yesterday morning fell shy of my 7050 T/P level with a 7030 high print. As I go to press the FTSE is trading at 6970. I will now lower my T/P level on this position to 6995 as I want to reduce my overall exposure. If this level is hit, I will come back with a new update for my Platinum Members.
Dow Rolling Contract
My Dow plan worked well with the market trading lower to my 33000 buy level before rallying to my revised 33300 T/P level with a 33550 rebound high. I stayed flat overnight which was fortuitous as the Dow got slammed and is now trading at 32700 as I go to press. The Dow is severely oversold, has support from 32200/32500 where I will again be an aggressive buyer with no stop. If I am taken long I will have a T/P level at 32790.
Cash NASDAQ 100
I am long and wrong in the NDX at a price of 13905, as I did not see the market falling 3.75% yesterday. Even though I am offside on this position I still believe we are going to see a massive short-covering rally which can start at any moment. I will leave my 13960 T/P level unchanged and if this level is triggered I will come back with an update for my Platinum Members.
June BUND
I have now rolled to the June Contract which trades at a 287- point Discount to the March Contract which has now expired. This morning the June Bund is trading at 166.10, as the market is selling off on the back of the slight rebound in Equity Markets. The June Bund has support from 164.80/165.30 where I will be a small buyer with a 164.15 stop.
Gold Rolling Contract
This morning Gold is trading higher at 2011. Gold is severely overbought. I do not want to go short Gold and I will stay flat until I feel I have a better edge in this market.
Silver Rolling Contract
I am still flat Silver as the market again missed my buy level before rallying to sit at 26.15 this morning. I will now raise my buy level to 24.70/25.30 with a 23.85 wider stop.
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