U.S. Equity rebounded from the recent bloodbath with slight outperformance in the NASDAQ 100 for the majority of the session although gains were broad based, with the S&P, RUSSELL 2000 and RSP (equal weighted S&P) not far behind. The sectoral outperformance was seen in Real Estate, Financials and Industrials, although all sectors were in the green with the large cap Tech, Consumer Discretionary and Comms notching gains north of 1.2%. However, some broad-based profit taking was observed within the last hour and a half of trade, withIindices closing off highs with the RUSSELL finishing out in front. T-Notes were choppy but ultimately bear steepened, with the equity rally and concession ahead of the 3 Year Auction weighing, with overnight pressure following the fastest increase of Japanese wages since 1997, while Asian stocks surging (Nikkei up over 10%) also likely added to the overnight pressures. Some rebound was seen after strong German Industrial orders, but once US equities rallied after the open, the T-Note selling resumed. In FX, the USD saw only marginal gains, with DXY hovering around 103.00, while the Japanese Yen underperformed after its recent rally but the Australian Dollar was the leader after hawkish commentary from RBA Governor Bullock, who noted the RBA discussed a rate hike at this meeting. It is also worth noting that in Japan, the top currency diplomat, Bank of Japan and FSA discussed the recent big moves in the stock market, forex and that they are closely watching FX moves but they gave no further details. The US International Trade Deficit in June narrowed to 73.1billion from 75 billion in May, although it was wider than the expected 72.5 billion. The trade balance saw exports rise by 1.5% to USD 269.5 billion, while imports rose by 0.6% to USD 339 billion. The June decrease in the goods and services deficit reflected a decrease in the goods deficit of USD 2.5 billion to 97.4 billion and a decrease in the services surplus of 0.6 billion to 24.2 billion. Imports of goods increased USD 1.9 billion to 271.6 billion, while exports of goods increased USD 4.4 billion to 174.2 billion in June. Imports of services increased USD 0.2 billion to 67.5 billion, while exports of services decreased USD 0.4 billion to 91.7 billion in June. Analysts at Oxford Economics note that “Net trade was shown to have been a 0.7ppt drag on GDP growth in Q2, and the June trade report is unlikely to materially change this number in the second release of GDP. The risks are for a larger drag, though, with real trade data from June’s report showing a 1.6% annualised decline in goods trade, compared to a 1.6% gain in the first estimate of GDP.” Meanwhile, Oil prices were choppy but ultimately settled marginally in the green while Gold closed lower by 0.9% following a choppy session.
To mark my 3050th issue of TraderNoble Daily Commentary I am offering a special 2-Year Rate of Euro 2750 for my Platinum Service which includes 1 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 615 points yesterday and is now down by 1343 points for August after closing July with a gain of 1918 points while June closed with a gain of 2074 points, having made 1843 points in May. The Platinum Service made 4010 points in 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 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 1.04% higher at a price of 5240.
The Dow Jones Industrial Average closed 294 points higher for a 0.76% gain at a price of 38,997.
The NASDAQ 100 closed 1.02% higher at a price of 18,077.
The Stoxx Europe 600 Index closed 0.29% higher.
This Morning, the MSCI Asia Pacific closed 0.8% higher.
This Morning, the Nikkei closed 1.15% higher at a price of 35,089.
Currencies
The Bloomberg Dollar Spot Index closed 0.28% higher.
The Euro closed 0.25% lower at $1.0928.
The British Pound closed 0.7% lower at 1.2767.
The Japanese Yen fell 0.4% closing at $144.73.
Bonds
Germany’s 10-year yield closed 1 basis points higher 2.20%.
Britain’s 10-year yield closed 5 basis points higher at 3.92%.
U.S.10 Year Treasury closed 10 basis points higher at 3.89%.
Commodities
West Texas Intermediate crude closed 0.14% higher at $73.04 a barrel.
Gold closed 0.9% lower at $2388 an ounce.
This morning on the Economic Front we already had the release of German Industrial Production which rose 1.4% versus +1.0% expected. Next, we have U.S. MBA Mortgage Applications at 12.00 pm. Finally, we have a 10-Year Treasury Auction at 6.00 pm and Consumer Credit at 8.00 pm.
Cash S&P 500
The longer that the VIX can stay over 20 the better as by definition it will lead to more of the two-way price action that we have witnessed in the past 24 hours. For a more lasting and sustained low I would have liked the markets to have tested Monday’s low, leading to positive divergences across the board and in turn setting up both the NDX and S&P for a more sustainable rally. However, the S&P rallied from the start to a late high at 5313 before falling over 100 Handles into the 10.00 pm Futures close. This move higher saw the S&P hit my revised 5296 T/P level on Monday’s 5284 average long position. Subsequently, I emailed my Platinum Members to buy the S&P which we did at an average price of 5221 before rallying overnight to my 5256 T/P level and I am now flat. With the Fear & Greed Index closing at 21 last night which is a reading of ‘’Extreme Fear’’ it is difficult to have a short position on board. However, even though the Nikkei tagged on an extra 1% this morning and is now over 4000 points higher than Monday’s rout we do not want to get sucked into another bull trap. Yesterday’s 5313 rebound high still falls short of Friday’s 5346 Chicago close. This ‘Open Gapp’ will attract buying until it is filled. Today, I will be a small seller from 5345/5365 with a 5381 ‘’Closing Stop’’. The S&P has support from 5204/5220 where I will again be a buyer with a 5189 wider ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 5328. If I am taken long, I will have a T/P level at 5242. If any of these price ranges change, I will be back with a new update for my Platinum Members.
EUR/USD
The Euro has traded in a narrow range over the past 24 hours, and I am still flat. The Euro has strong resistance from 1.1020/1.1090 where I will be a small seller with a 1.1155 ‘’Closing Stop’’. The Euro has support below from 1.0800/1.0880 where I will be a buyer with a higher 1.0745 ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 1.0970. If I am taken long, I will have a T/P level at 1.0930.
Dollar Index
The Dollar rallied 30 points yesterday and is back above 103.30 this morning. I am still long at an average rate of 103.30 with the same 102.35 ‘’Closing Stop’’. Meanwhile, I will leave my 103.70 T/P level unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash DAX
No Change: As I am now long the NDX I will stay flat the DAX as I have no interest in initiating a short position at these levels. If this view changes, I will be back with a new update for my Platinum Members.
Cash FTSE
My FTSE plan worked well as the market sold off to my 7950-buy level before rallying to my 8015 T/P level and I am now flat. Today, I will again be a buyer on any dip lower to 7880/7950 with the same 7795 wider ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 8010. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
The Dow had a nice rally off yesterday’s 38600 low print, rallying to an overnight high at 39300, before having a small 100-point sell-off as I go to post. I will now raise my Dow buy level to 38450/38700 with a higher 38195 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 38920.
Cash NASDAQ 100
There is no doubt that the tech bubble is in the process of popping like it was in 2000 when the entire sector got swept away by the internet. Now the whole sector is getting swept away by the A.I. craze. Investors are second guessing just how big the TAM (Total Addressable Market) will be ultimately: that Capex is a double-edged sword since it may be future revenue for one firm but an expense for another. The big question is whether the spending boom underway will generate the expected returns down the road. To Be Determined! What happened with Intel this past week is a classic case in point as the stock price was down a massive 28% in one day as it was forced to announce a 15% cut in its headcount, suspend its dividend and announce a reversal in its aggressive capital spending plan. This is a really big deal and has industry-wide implications. As with Cisco more than 20-years ago, consider this news to be a leading indicator of more to come. NVIDIA ‘s stock has plunged more than 20% since late June when it briefly became the world’s most valuable company, with a market value of more than $3.3 trillion. But as we saw with routers, cable and fibre optics in the late 1990s, anxiety over A.I. over investment is now beginning to build and the comparisons are stark. Keep in mind that the chip maker is still up about 120% this year and more than 600% since the start of 2023, so there is a lot of air under this thing and nearly everybody in the stock market owns it. I am still long the NDX at an average rate of 18390 and nervous. I will use any further rally to 18440 to exit this large position and reassess.
September BUND
The Bund is trading at a price of 134.70 this morning. This is where my average short position is. Having watched the Bund trade over 136 I have decided to use this sell-off to be flat especially as there is no points loss. The Bund has support below from 133.00/133.80 where I will be a buyer with a 132.35 ‘’Closing Stop’’. The Bund has resistance from 135.50/136.20 where I will be a seller with a higher 136.85 ‘’Closing Stop’’.
Gold Rolling Contract
My Gold plan worked well as the market traded lower to my 2383 buy level before rallying to my revised 2391 T/P level and I am now flat. Gold continues to attract buyers on dips despite been overvalued vis a v Silver. Gold has support below from 2358/2374. I will be a small buyer on any dip to this area with a lower 2343 ‘’ Closing Stop’’.
Silver Rolling Contract
No Change: I am still long at an average rate of 29.80. I will add to this trade on any further move lower to 26.40. I will continue to have no T/P level or Stop on this position. If this view changes, I will be back with a new update for my Platinum Members.
Recent Comments