Both the S&P 500 and NASDAQ 100 closed little changed on Tuesday after losses out of Europe faded through the New York morning with risk assets in a holding pattern amid macro catalysts on the light side ahead of CPI on Thursday and bank earnings on Friday. The Russell 2000 index closed firmly in the red, however, despite paring off lows, with the small-cap index suffering from the recent back up in Treasury Yields. Treasuries were lower as rampant global supply kept the pressure on global govvies; the US 3yr auction was well received ahead of the 10yr and 30yr offerings this evening and tomorrow, respectively. European debt issuance totalled a new daily record above EUR 43bln, according to Bloomberg, with EGBs underperforming U.S. Treasuries. The Dollar pared some of Monday’s losses, with the Swiss Franc the G10 underperformer and cyclical currencies not far behind. Similarly, the crude complex pared some of Monday’s extensive losses. Key U.S. data was on the light side Tuesday (November Trade Deficit narrowed on softening consumer imports while the RCM/TIPP economic optimism index rose amid the rise in stock prices), with little out on Wednesday either ahead of CPI and PPI on Thurs and Fri, respectively. However, Fed Member Williams (voter) is scheduled to speak on policy and outlook on Wednesday. In stocks, Microchip (MCHP) saw just mild losses despite a guidance cut amid a dimming macroeconomic environment. Samsung (005930) was another tech name under pressure out of APAC after a poor preliminary earnings report. Juniper (JNPR) surged on Wall Street Journal Reports of Hewlett Packard Entertainment (HPE) nearing a deal to buy it for $13bln. U.S. International Trade in November posted a narrower deficit than expected at 63.2bln (exp. 65bln), narrowing from the prior 64.5bln deficit. The lower deficit was led by a larger decline in imports than exports; the goods deficit fell by 0.6bln to USD 89.4bln while the services surplus increased by USD 0.7bln to USD 26.2bln. Oxford Economics highlights that “The drop in imports was mostly driven by a drop in consumer goods and, should it be sustained, could mark a pullback in inventory levels by retailers.” Note, the Atlanta Fed GDP tracker was lowered to 2.2% on Tuesday from 2.5% in wake of several data points. The employment situation, ISM services and auto sales saw the Atlanta Fed fall from 2.5% to 2.0%. However, after the trade data it was revised up to 2.2%. Elsewhere, Oil rose 1.89% while Gold closed flat following a quiet trading session.
To mark my 2925th 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 160 points yesterday and is now ahead by 1213 points for January. December saw a gain of 1890 points after finishing November with a gain of 1734 points. October ended with a gain of 3184 points, after closing September with a small gain of 228 points, after finishing August with a gain of 1485 points, 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 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 0.15% lower at a price of 4756.
The Dow Jones Industrial Average closed 157 points lower for a 0.52% loss at a price of 37,525.
The NASDAQ 100 closed 0.17% higher at a price of 16,676.
The Stoxx Europe 600 Index closed 0.17% lower.
This morning, the MSCI Asia Pacific closed 0.6% higher.
This morning, the Nikkei closed 2.01% higher at a price of 34,441.
Currencies
The Bloomberg Dollar Spot Index closed 0.34% higher.
The Euro closed 0.2% lower at $1.0929.
The British Pound closed 0.3% lower at 1.2705.
The Japanese Yen fell 0.2% closing at $144.48.
Bonds
Germany’s 10-year yield closed 5 basis points higher at 2.19%.
Britain’s 10-year yield closed 1 basis points higher at 3.78%.
U.S.10 Year Treasury closed 2 basis points higher 4.01%.
Commodities
West Texas Intermediate crude closed 1.89% higher at $72.11 a barrel.
Gold closed 0.1% higher at $2029.10 an ounce.
This morning on the Economic Front we have a speech from ECB Member De Guindos at 8.20 am. Next, we have U.S. MBA Mortgage Applications at 12.00 pm, followed by Wholesale Inventories at 3.00 pm. Finally, we have a speech from Fed Member Williams at 8.15 pm.
Cash S&P 500
There is no doubt the theme since the October 2022 lows has been to buy every dip. Almost every economist predicted a recession last year which did not materialise much to the frustration of these analysts. The latest Consumer Credit data sees consumers continuing to pile into credit and continue to spend. In a recession this indicator hits a wall which obviously has not happened. Perhaps that wall will get hit this year, but it clearly has not yet despite how ruinous this may well turn out for many people. With Share buybacks resuming at the end of the month it is difficult to make a ‘’Bear’’ case for the equity markets despite some key signals still severely overbought following a nine-week winning streak into year-end. Both the 5 EMA and 14 EMA are between 4730 and 4740. This support level was tested yesterday afternoon before attracting buyer into the close. My S&P plan worked well as the S&P hit my 4738 buy level before rallying 20 Handles. However, as a number of my calls hit a the same time I covered this position too early at 4744 and I am still flat. Today, I will again be a buyer on any dip lower to 4730/4745 with a 4719 ‘’Closing Stop’’. Ahead of CPI tomorrow, I certainly do not want to be short the S&P. If this view changes I will be back with a new update for my Platinum Members.
EUR/USD
No Change. The Euro traded in a narrow range yesterday and I am still flat. I will not chase the Euro higher, keeping my 1.0820/1.0890 buy level unchanged with the same 1.0765 ‘’Closing Stop’’. I still do not want to be short the Euro at this time.
Dollar Index
The Dollar traded in a narrow 30-point range yesterday and I am still flat. The Dollar has strong support from 101.00/101.80 where I will still be a buyer with the same 100.65 ‘’closing Stop’’. I no longer want to be short the Dollar. If this view changes, I will be back with a new update for my Platinum Members.
Cash DAX
My DAX plan worked well as the market traded lower to my 16610 initial buy level before having a nice 100-point rally. As both the S&P and NDX buy levels hit at the same time, I covered my long DAX position at 16640 and I am still flat. This morning, the DAX is trading at 16680. The DAX has support from 16480/16580 where I will again be a buyer with a 16395 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 16650.
Cash FTSE
The FTSE continues to trade heavy, with the market again trading in a narrow 50-point range yesterday. I am still flat as the market never came close to Yesterday’s sell range. Today, I will now lower my sell level to 7750/7820 with a lower 7885 ‘’Closing Stop’’. The FTSE has short-term support from 7550/7620 where I will be a buyer with a 7495 tight ‘’Closing Stop’’.
Dow Rolling Contract
The Dow traded heavy yesterday, closing lower by 0.5%. Despite only a small sell-off over the past week, the 14 Day RSI has finally fallen, closing at 55 last night. The Dow has support from 37000/37250 where I will be a small buyer with a 36855 ‘’Closing Stop’’. The Dow has further resistance from 37800/38050 where I will continue to be a small seller with the same 38305 ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 37650. If I am taken long, I will have a T/P level at 37405.
Cash NASDAQ 100
My NDX plan worked well as the market sold off to my 16510 buy level before rallying to my revised 16580 T/P level and I am now flat. This morning, the NDX is trading higher at 16690. The NDX has short-term support from 16470/16620 where I will again be a buyer with a higher 16255 ‘’Closing Stop’’. Despite the NDX being short-term overbought I have no interest in being short this market. If this view changes, I will be back with a new update for my Platinum Members.
March BUND
Unfortunately, the Bund missed my initial 135.10 buy level by 8 points before having a nice 70-point rally into the close. I will not chase the Bund higher, leaving my 134.30/135.10 buy level unchanged with the same 133.75 ‘’Closing Stop’’. I still no longer want to be short the Bund at this time.
Gold Rolling Contract
No Change. Gold traded in a narrow range yesterday and I am still flat. Today, I will continue to be a buyer on any dip lower to 2000/2015 with the same 1999 ‘’Closing Stop’’. I still do not want to be short Gold at this time.
Silver Rolling Contract
No Change. I still believe in the bull case for this precious metal. I will continue to hold my 24.40 average long position with no stop or T/P level for now. If this view changes, I will be back with a new update for my Platinum Members.
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