U.S Equity Markets continued their rally after the slump seen last week. The majority of the upside was sparked after the soft US PMI data with some cautious commentary on the labour market supporting the dovish move. As a result, the Dollar sold off throughout the session while T-Notes bull steepened. The 2 Year Treasury Auction was solid but it had little market impact with the PMI data driving price action throughout the session. In FX, the Dollar lagged while Pound outperformed after hawkish commentary from Bank of England Chief Economist Pill despite dovish remarks from Ramsden on Friday. The Japanese Yen saw some strength overnight on remarks from Finance Minister Suzuki that last week’s discussions in Washington have laid the groundwork for Japan to take appropriate FX action. There was also a Nikkei sources article noting the Bank of Japan will discuss the rapid slide of the Yen at their meeting later this week; helping keep USD/JPY sub-155.00. EUR/USD reclaimed 1.07 thanks to the Dollar weakness. Meanwhile, on earnings, UPS, GE and GM figures were strong although Materials name underwhelmed. US S&P Global Flash PMIs for April were soft, as Manufacturing fell into contractionary territory printing 49.9 (exp. 52.0, prev. 51.9). Services fell to 50.9 from 51.7, and shy of the forecasted 52.0, leaving the Composite at 50.9 from 52.1. As a result of the cooler-than-expected metrics a broad-based dovish reaction was seen across markets. Within the release, it says “the US economic upturn lost momentum at the start Q2, and further pace may be lost in the coming months, as April saw inflows of new business fall for the first time in six months and firms’ future output expectations slipped to a five-month low amid heightened concern about the outlook”. Further still, the report adds that “notably, the drivers of inflation have changed. Manufacturing has now registered the steeper rate of price increases in three of the past four months, with factory cost pressures intensifying in April amid higher raw material and fuel prices, contrasting with the wage-related services-led price pressures seen throughout much of 2023.” New home sales in March rose 8.8% to 693k, above the expected 670k and the prior, revised lower, 637k. Internally, new home supply fell to 8.3 months’ worth (prev. 8.8 months in Feb), with the median sale price falling 1.9% Y/Y to USD 430,700 from USD 438,900. Overall, while the headline surprised to the upside, a downward revision to February sales took some of the steam out of it. Looking ahead, Oxford Economics notes its baseline assumes that new-home sales will edge slightly higher over the remaining three quarters of 2024, although the recent backup in mortgage rates lends a downside risk to that forecast. Despite Telsa earnings coming in much weaker than expected, the share price is ahead by 13% this morning, helping the NDX and S&P to continue this week’s surge. Elsewhere, Oil rose 1.75% while Gold ended Tuesday flat, following another volatile trading session.
To mark my 2975th 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 68 points yesterday and is now ahead by 3184 points for April after ending March with a gain of 2113 points. February closed with a gain of 1606 points, after closing January with a gain of 3675 points. 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 1.20% higher at a price of 5070.
The Dow Jones Industrial Average closed 263 points higher for a 0.69% gain at a price of 38,503.
The NASDAQ 100 closed 1.51% higher at a price of 17,471.
The Stoxx Europe 600 Index closed 1.09% higher.
This Morning, the MSCI Asia Pacific closed 1.1% higher.
This Morning, the Nikkei closed 2.42% higher at a price of 38,460.
Currencies
The Bloomberg Dollar Spot Index closed 0.50% lower.
The Euro closed 0.3% higher at $1.0702.
The British Pound closed 0.7% higher at 1.2448.
The Japanese Yen fell 0.1% closing at $154.86.
Bonds
Germany’s 10-year yield closed 1 basis points higher at 2.50%.
Britain’s 10-year yield closed 4 basis points higher at 4.24%.
U.S.10 Year Treasury closed 2 basis points lower at 4.59%.
Commodities
West Texas Intermediate crude closed 1.75% higher at $83.33 a barrel.
Gold closed 0.1% lower at $2323.10 an ounce.
This morning on the Economic Front we have the German IFO Survey at 9.00 am followed by a 10-Year Bund Auction at 10.30 am. Next, we have U.S. MBA Mortgage Applications at 12.00 pm and Durable Goods Orders at 1.30 pm. Finally, we have a speech from ECB Member Schnabel at 3.00 pm.
Cash S&P 500
The expected bounce from a way oversold market continued all-day yesterday and again overnight, with the S&P now trading almost 140 Handles higher from last Friday’s 4953 low print. I said yesterday that the Bulls had six trading days left to rescue what had been an awful April and they have certainly accomplished this with many Moving Averages recaptured. The Weekly 5 EMA comes in at 5070 and the Weekly 14 EMA at 5032. Both of these key averages will attract buying on any further sell-off. However, the S&P is still in a downtrend until both the 20 Day Moving Average at 5102 and 50 Day MA (5119) are recaptured. Today, I will be a small seller from 5102/5120 with a tight 5131 ‘’Closing Stop’’. I do not like selling the S&P but the 5100/5120 is now key resistance and a good place to try a short position. The S&P has support from 5048/5063 where I will be a buyer with a 5035 ‘’Closing Stop’’.
EUR/USD
The Euro finally rallied to my 1.0670 T/P level on last week’s 1.0630 long position, and I am now flat. The Euro has support from 1.0590/1.0660 where I will again be a buyer with a higher 1.0515 ‘’Closing Stop’’. I still do not want to be short the Euro at this time.
Dollar Index
It took a while but finally the three consecutive 91 print for the Daily Sentiment Index in the Dollar worked out as the Dollar fell 0.50% yesterday. This move lower saw my revised 105.72 T/P level triggered on last week’s 106.05 short position and I am now flat. Today, I will again be a seller of the Dollar from 106.05/106.65 with a lower 107.15 ‘’Closing Stop’’. I still do not want to be long the Dollar at this time.
Cash DAX
The DAX surged again yesterday, trading over 600 points higher from where we were last Friday. Poor Bears they just cannot get anything going on the downside as traders continue to buy every dip. I am still flat. I will now raise my buy level to 17930/18030 with a higher 17855 tight ‘’Closing Stop’’. Despite the aggressive rally this week, I still do not want to be short the DAX at this time.
Cash FTSE
After the FTSE hit my 8020-buy level we had a small rally. As I was trying to reduce my NDX loss all-day, I covered this long position at my revised 8044 T/P level, and I am now flat. Today, I will again be ab buyer of the FTSE on any dip lower to 7940/8010 with a lower 7865 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 8060. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
After the Dow hit my sell range for a 38500 short position, we had a small sell-off to my revised 38425 T/P level and I am now flat. The Dow has now rallied over 1200 points off last Friday’s low print. The Dow is now within 1500 points of its all-time high which is incredible when you see how much both the NDX and S&P fell in April. The Dow has further resistance from 38730/38980 where I will again be a seller with a higher 39105 ‘’Closing Stop’’. The 50 Day Moving Average is at 38804 this morning and should act as strong resistance on any initial test. I still do not want to be long the Dow at this time. If this view changes, I will be back with a new update for my Platinum Members.
Cash NASDAQ 100
The NDX surged yesterday, closing higher by over 1.5%. This move higher saw my 17350-exit level triggered, on my large 17590 short position and I am now flat. After the close the NDX is trading 0.4% higher at 15585 this morning despite worse-than-expected earnings from Tesla. Both the 20 Day MA and 50-Day MA come in at 17755, and 17950 respectively this morning. This zone will act as strong resistance on any initial test especially as the 20 MA broke below the 50 MA two weeks ago. As a result, I will be an aggressive seller from 17720/17870 with a wider 18005 ‘’Closing Stop’’. I no longer want to be long the NDX at this time. If this view changes, I will be back with a new update for my Platinum Members.
March BUND
Frustratingly, the Bund just missed yesterday’s 130.70 before having a small rally into the close. Given how lower Bund Yields are I am reluctant to chase the Bund higher. Therefore, I will continue to be a buyer on any dip lower to 129.90/130.70 with the same 129.25 ‘’Closing Stop’’. Despite the negative price action, I still do not want to be short the Bund at this time.
Gold Rolling Contract
Gold did not stay below 2300 for long. The weaker Dollar saw Gold rally over 1% yesterday, sitting at 2326 as I go to press. I will now raise my Gold buy level to 2287/2303 with a higher 2275 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 2317. I no longer want to be short Gold at this time.
Silver Rolling Contract
No Change. I am still long Silver at an average rate of 27.30 with a now lower 27.90 T/P level. I will leave my 25.95 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
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