U.S Indices closed lower after a volatile trading session. Markets bounced around before selling off in the last two hours of trading. Weekly Jobless claims missed estimates and were even weaker than last week, while Continuing Claims unexpectedly rose. This sparked concerns that the economic recovery was stalling. But the overall downward trend (as measured by the four-week average) remained intact. In terms of Stimulus, Senate Democrats shot down a $650 billion “skinny” proposal brought forward by Senate Republicans. This continued to fuel worries that a support bill will not be reached. On the vaccine front, AstraZeneca’s CEO said the company will have a good idea by year’s end whether or not its Coronavirus candidate protects people. There were also reports that the company’s trial could restart as soon as next week. Both the S&P and Dow ended the day with losses of 1.77% and 1.45% respectively. Meanwhile European Indices ended lower after the ECB left Interest Rates unchanged and did not introduce anymore Stimulus. While the ECB did not enact any new measures, it said it stands ready to adjust all of its policy tools as necessary to provide ongoing economic support. The European Union was said to be preparing legal action if the U.K. went through with its plan to break the Brexit agreement. France’s Coronavirus hospitalisations hit a one-month high as new cases continue to rise. Elsewhere, Oil closed 2.73% lower as U.S Crude Inventories unexpectedly rose, raising concerns of oversupply while Gold again closed flat.
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For anyone following my Platinum Service it made 353 points yesterday and is now ahead by 797 points for September, having made 2383 points in August, 3128 points in July, 2580 points in June, 2456 points in May, 4773 points in April, an incredible 9264 points in March, 2223 points in February and 2142 points in January. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
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The S&P 500 closed 1.77% lower at a price of 3339.
The Dow Jones Industrial Average closed 406 points lower for a 1.45% loss at a price of 27,534.
The NASDAQ 100 closed 2.12% lower at a price of 11,154.
The Stoxx Europe 600 Index fell 1.1%.
The MSCI Asia Pacific Index rose 0.8%.
This morning the Nikkei closed 0.74% higher at 23,406.
The Bloomberg Dollar Spot Index again closed 0.3% higher.
The Euro closed 0.1% higher at $1.1830.
The British Pound closed 1.5% lower at $1.2805.
The Japanese Yen closed 0.1% higher at 106.00 per dollar.
The yield on 10-year Treasuries closed two basis points lower at 0.68%.
Germany’s 10-year yield closed unchanged at -0.46%.
Britain’s 10-year yield closed one basis point lower at 0.24%.
The Bloomberg Commodity Index fell 0.8%.
West Texas Intermediate closed 2.73% lower at $36.91 a barrel.
Gold closed unchanged at $1,943.10 an ounce.
This morning on the Economic Front we had German Wholesale Prices which fell 0.4% versus +0.5% expected. UK GDP for July was also released, coming in at +6.6% versus +6.7% expected. The ECB’s Schnabel and Lane are speaking at 9.50 am and 1.00 pm respectively. Remember it was last week that Lane started talking the Euro lower. Finally, we have U.S CPI at 1.30 pm and the Monthly Budget Statement at 7.00 pm.
September S&P 500
My S&P plan worked very well with both my sell level and buy level being hit as the market again ran into a brick wall at 3420. After the S&P hit my 3415 sell level I covered this position too early at 3405 before we traded the whole of my buy range for a 3347 average long position very near the close. With the Dow and NASADAQ being hit at the same time I had too much risk and I covered the S&P at my revised 3353 T/P level and I am still flat. It is very difficult to stay short as already this morning the S&P is trading 22 Handles higher than last night’s Chicago close. The 50 Day Moving Average has moved higher to 3317. I still expect a bounce on any test but not as strong as Wednesday. I will be a buyer from 3310/3326 with a 3299 stop. The S&P has resistance from 3385/3405 where I will be a seller with a 3425 wider stop.
Much to my surprise ECB President said the rising Euro was not a concern. As a result the Euro rose to my 1.1898 sell level before selling off to my 1.1860 T/P level and I am now flat. The Euro has resistance from 1.1900/1.1940 where I will be a seller with a 1.1985 stop. I will now raise my buy level to 1.1710/1.1760 with a higher 1.1665 stop.
December Dollar Index
My Dollar plan worked well with the Dollar trading lower to my 92.75 buy level before rallying to my 93.05 T/P level and I am now flat. Today I will again be a buyer from 92.35/92.75 with a 91.85 stop.
The DAX just missed my 13080 initial buy level and I am still flat. The DAX continues to outperform the US Indices this month. I am not going to chase the market higher and I will leave my 13000/13080 buy level unchanged with the same 12925 stop. Ahead of the weekend I will have no sell level.
With Sterling falling another 1.5% yesterday, this is helping the FTSE to stay bid relative to the other major Indices. I am still flat and I will now raise my buy level to 5895/5945 with a higher 5849 stop.
Dow Rolling Contract
My Dow plan worked very well with the market trading higher to my 28145 sell level before falling to a late low at 27457. This move lower enabled me to cover this position at my revised 28080 T/P level before the market hit my average buy level at 27575. As I wanted to be flat overnight, I covered this position at my revised 27650 T/P level. The 50 Day Moving Average has moved higher to 27237 and today my buy level will be from 27220/27420 with a tight 27095 stop. I will be a small seller from 27920/28080 with a 28205 stop.
Very late in yesterday’s session the NASDAQ traded lower to my average 11150 buy level before rallying to my too tight 11200 T/P level and I am now flat. This morning the NASDAQ is trading higher at 11300 having successfully tested its 50 Day MA again at 11114. Today. I will be a buyer from 11050/11180 with a tight 10975 stop. If I am taken long and subsequently stopped out of this position, I will be an aggressive buyer from 10850/10650 with a 10535 stop. If I am taken long I will have a T/P level at 11270. If I am taken long a second time I will have a T/P level at 11030.
Now you can see why I prefer to use a closing stop rather than a fixed stop as after the Bund hit my 173.15 stop on my latest 173.75 long position the Bund rallied on the weakness in equities. I emailed my Platinum Members to buy the Bund again at 173.44. I am still long and I will now lower my T/P level on this position to 173.84. I will leave my stop unchanged at 172.95.
Gold Rolling Contract
No Change as I am still a buyer from 1900/1915 with the same 1888 stop.
Silver Rolling Contract
I am still flat as the market continues to trade heavy below last month’s 28.70 high. Ahead of the weekend I will leave my 25.40/25.90 buy level unchanged with the same 24.75 stop.