U.S. Equity Markets built on Monday’s late reversal, finished the day higher, led by the 0.48% rally in the S&P. This move higher saw the VIX get slammed, closing 10% lower, below the key 30 level. Data published by the U.S. Bureau of Labour Statistics showed the number of job openings in the U.S. totalled 11.5 million at the end of March. That is higher than February’s figure of 11.3 million, indicating the labour market continues to remain out of balance. Even though job figures have rebounded by nearly 93% since the worst of COVID-19, millions of workers are either refraining from finding a job or are quitting for new prospects amid a record number of openings. As this continues, it could further pressure businesses to raise wages to retain their workers – resulting in higher costs and increased prices to offset the hit. In turn, this could support more aggressive interest-rate hikes by the Federal Reserve to rein in higher prices and broader inflation. Within the S&P 500, nine of the 11 sectors finished higher. European Markets closed mixed. Russia avoided a default for the first time since 1918 by making Dollar payments on $650 million worth of bonds due in 2022 and 2042. German Economy Minister Robert Habeck said the proposal to end reliance on Russian energy supplies means the era of cheap prices is over, implying sustainably higher inflation. European Union members are reportedly considering a complete phase-out of Russian oil products by the end of 2022. The Euro-Zone’s Producer Price Index for March showed growth that was higher than anticipated due to rising energy costs. In Asia, China’s National Health Commission reported new mainland COVID-19 cases continued to ease, remaining below the 10,000 as most of the infections remain in Shanghai. Japanese Prime Minister Fumio Kishida said he signed an agreement with Thailand to exchange military equipment and technology, potentially stoking Chinese political tensions. South Korea’s Consumer Price Index growth for April was greater than expected, hitting its highest level since 2008 and supporting additional interest-rate hikes. Elsewhere, Oil closed 2.29% lower as Chinese lockdowns weigh on supply chains, while Gold rose 0.17% as inflation risks are anticipated to provide a temporary boost to the precious metal.
To mark my 2525th 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 275 points yesterday and is now ahead by 275 points for May having made 762 points in April, following a gain of 5883 points in March. The Platinum Service made an impressive 5324 points 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 0.48% higher at a price of 4175.
The Dow Jones Industrial Average closed 67 points higher for a 0.20% gain at a price of 33,128.
The NASDAQ 100 closed 0.11% higher at a price of 13,089.
The Stoxx Europe 600 Index closed 0.6% higher.
Yesterday, the MSCI Asia Pacific Index rose 0.2%.
Yesterday, the Nikkei closed 0.11% lower at a price of 26,818.
Currencies
The Bloomberg Dollar Spot Index closed 0.2% lower.
The Euro closed 0.2% higher at $1.0521.
The British Pound closed 0.1% higher at 1.2498.
The Japanese Yen rose 0.1%, closing at $130.05.
Bonds
Germany’s 10-year yield closed one basis points higher at 0.98%.
Britain’s 10-year yield closed five basis points higher at 1.95%.
US 10 Year Treasury closed one basis points higher at 2.99%.
Commodities
West Texas Intermediate crude closed 2.29% lower at $102.95 a barrel.
Gold closed 0.17% higher at $1868.10 an ounce.
This morning on the Economic Front we have German Trade Balance and Current Account at 7.00 am, followed by Euro-Zone Global Services PMI at 9.00 am. Next, at 9.30 am we have U.K. Money Supply, Net Credit to Individuals and Mortgage Approvals. At 10.00 am we have Euro-Zone Retail Sales. This is followed by U.S. MBA Mortgage Applications at 12.00 pm and the ADP Employment Report at 1.15 pm. Next, we have the Trade Balance at 1.30 pm, S&P Global Composite PMI at 2.45 pm and ISM Services PMI at 3.00 pm. Finally, we have the FOMC Statement at 7.00 pm where the Fed are expected to increase rates by 50 basis points and the Powell Press Conference at 7.30 pm.
Cash S&P 500
The S&P built on Monday’s late 100 Handle rally to hit the 5EMA at 4200 before having a small sell-off into the close. Today is all about the Fed and just like in March I will expect to see plenty of two-way price action. Everything is grossly oversold and is the main reason why I am only a buyer on dips. Remember at the March FOMC Meeting the S&P fell 60 Handles before starting a 400 Handle rally that took just two weeks. Conditions are more oversold now and given the pressure the Fed are under, Fed Chair Powell is facing his most crucial press conference ever at 7.30 pm as he does not want to see stocks crater further as this will cause not only a recession but likely a depression. The markets have done all the tightening required by the Fed with a huge 10 Rate hikes priced in. There is not a chance of the Fed being so aggressive. My own view is they will meet somewhere in the middle. Both the Dollar and Bond yields are setting themselves up for a major reversal given the Daily Sentiment Index Readings in both contracts. A weaker Dollar will go along way to a strong rally in the S&P. Ahead of the FOMC, I will not change any of my parameters leaving my 4085/4115 buy level unchanged with the same 4039 stop. If I am taken long I will have a T/P level at 4152. I am still long the S&P from last month at an average rate of 4263 with the same no stop and a T/P level at 4293.
EUR/USD
No Change. I am still a strong buyer on any dip lower to 1.0420/1.0480 with a 1.0345 stop. If I am taken long I will have a T/P level at 1.0540
March Dollar Index
No Change. I am still a seller from 103.80/104.40 with the same 105.05 stop.
Cash DAX
The DAX again traded in a narrow range and I am still flat. I will now raise my buy level to 13780/13860 with a higher 13695 stop.
Cash FTSE
My latest long FTSE position worked well with the market trading higher to my 7485 T/P level and I am still flat. The FTSE subsequently rallied a further 80 points to sit at 7560 as I go to press. We have support from 7450/7510 where I will again be a buyer with a 7395 tight stop.
Dow Rolling Contract
Unfortunately, the Dow fell shy of my 32800 buy level with a 32895 low print before rallying to an afternoon high at 33340 and I am still flat. I will now raise my buy level to 32720/32920 with a wider 32495 stop. Given how oversold the market is trading I no longer want to be short at this time.
Cash NASDAQ 100
The NDX rallied to my 13120 revised T/P level as emailed to my Platinum Members. Yesterday saw plenty of two-way price action but at least we did not come anywhere near testing Monday’s low. Today I will again be a buyer from 12950/12800 with a 12695 stop. If I am taken long I will have a T/P level at 13105. I continue to nurse last month’s 14327 long position which I have now carried into May.
June BUND
No Change. I am still long at 153.90 with the same 154.30 T/P level. Ahead of the FOMC Statement I will have no stop on this position. If any of the above levels are hit I will be back with a new update for my Platinum Members.
Gold Rolling Contract
My latest 1867 long Gold position worked well with the market rallying to my 1877 T/P level and I am still flat. Gold has strong support from 1820/1835 where I will be a strong buyer with a wider 1799 stop.
Silver Rolling Contract
No Change. I am still a buyer on any dip lower to 21.70/22.30 with a 20.95 stop.
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