U.S. Equity Markets finished yesterday’s session strongly, led by the 1.44% gain in the NASDAQ 100. Markets focused on economic data for clues on the Federal Reserve’s future path of rate hikes. The U.S. Department of Labour’s Jobless Claims data for the week of July 16 exceeded Wall Street’s expectations. The trend has been steadily higher since the central bank began raising interest rates in mid-March. This points to the potential for the labour supply to increase, fulfilling one of the Fed’s goals for cooling inflation. At the same time, the Federal Reserve Bank of Philadelphia’s Business Outlook Survey for July pointed to economic activity cooling. Overall activity contracted for the second consecutive month as new orders, prices paid, delivery times, and the number of employees declined. The numbers would also support the central bank easing up on rate hikes moving forward. Within the S&P 500, nine of the 11 sectors finished higher. European Markets closed higher. The European Central Bank (“ECB”) raised interest rates by 0.5% at yesterday’s policy meeting. This was higher than the originally anticipated 0.25% bump by Wall Street. However, the change should help stabilise the Euro. This was the first rate increase in 11 years. It takes them back to zero and ends the experiment with negative rates. The Euro has been in a free fall ever since the Fed started tightening and the ECB stood still. The currency recently fell below parity with the U.S. Dollar for the first time since 2002. In Asia, Markets fell on concerns about the regional growth outlook. Overnight, the Asian Development Bank lowered its economic expansion forecast for 2022 from 5.2% to 4.6%, citing the Russian invasion of Ukraine for the increase in costs. Chinese health officials warned about a rise in COVID-19 infections. Numbers hovered around the highest level in two months. Officials in the financial and manufacturing hub of Shanghai added more districts to their watchlist, leaving investors concerned about the potential for more lockdowns and supply-chain delays. Elsewhere, Oil fell 3.51% while Gold closed 1.38% higher on a weaker Dollar.

To mark my 2575th issue of TraderNoble Daiy 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 655 points yesterday and is now ahead by 3414 points for July after closing June with a gain of 3371 points June, while making 3651 points in 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. 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 1% higher at a price of 3999.

The Dow Jones Industrial Average closed 162 points higher for a 0.51% gain at a price of 32,036.

The NASDAQ 100 closed 1.44% higher at a price of 12,619.

The Stoxx Europe 600 Index closed 0.5% higher.

This morning, the MSCI Asia Pacific Index rose 0.3%.

This morning, the Nikkei closed 0.4% higher at a price of 27,912.

Currencies 

The Bloomberg Dollar Spot Index closed 0.2% lower.

The Euro closed 0.3% higher at $1.0215.

The British Pound closed 0.1% higher at 1.2002.

The Japanese Yen rose 0.4% closing at $137.73.

Bonds

Germany’s 10-year yield closed 4 basis points lower at 1.22%.

Britain’s 10-year yield closed 0 basis points lower at 2.06%.

US 10 Year Treasury closed 14 basis points lower at 2.90%.

Commodities

West Texas Intermediate crude closed 3.51% lower at $98.86 a barrel.

Gold closed 1.38% higher at $1718.10 an ounce.

This morning on the Economic Front we already had the release of U.K. June Retail Sales which fell 0.1% versus -0.3% expected. Next, we have German, Euro-Zone, U.K. and U.S. Global Services PMI at 8.30 am, 9.00 am, 9.30 am and 2.45 pm respectively. At 10.00 am we have U.K. CPI. Finally, at 6.00 pm we have the Baker Hughes U.S. Oil Rig Count.

Cash S&P 500

My S&P plan worked well yesterday as the 50 Day Moving Average held again following a re-test after the ECB surprised markets with a 0.5% rate hike. Bears could not make anything happen as the S&P rallied to my initial 4000 target level as outlined last week. The afternoon drop saw the S&P hit my 3928 buy level before rallying to my 3945 T/P level. Just before the close the S&P accelerated to my 3999 sell level. As I wanted to be flat overnight, I emailed my Platinum Members to exit any short position at 3986 and I am now flat. The S&P is now overbought, is trading well above its Daily Bollinger Band while the McClellan Oscillator is close to overbought, closing at +214 last night. Now, I hate shorting the S&P on a Friday so we may have to wait until Monday to put a more reliable short position especially if the market can rally further into its ‘’Open Gap’’ this afternoon. The S&P has resistance from 4018/4038 where I will be a small seller with a 4051 ‘’Closing Stop’’. The S&P has support from 3948/3968 where I will be a strong buyer with a 3933 ‘’Closing Stop’’.

EUR/USD

Frustratingly, the Euro missed my 1.0150 buy level by three points before rallying to an afternoon high at 1.0230 and I am still flat. I will now raise my buy level slightly to 1.0100/1.0160 while leaving my 1.0035 ‘’Closing Stop unchanged. I still do not want to be short the Euro at this time.

March Dollar Index

No Change. I am still a seller on any further rally to 107.20/107.90 with the same 108.55 stop.

Cash DAX

Shortly after I posted Dragi resigned sending the DAX lower to my 13150 buy level. Subsequently, the DAX rallied to my 13215 T/P level and I am still flat. This morning the DAX is trading lower despite the rally in the American Indexes. However, I still have no interest in being short. We have support from 13010/13090 where I will be an aggressive buyer with a 12945 ‘’Closing Stop’’.

Cash FTSE

The FTSE traded in a narrow range yesterday and I am still flat. I will now lower my sell level to 7340/7410 with a 7465 stop.

Dow Rolling Contract

The Dow saw plenty of two-way price action yesterday. My strategy of buying every dip since the June lows has worked well with the market again hitting my 31670 buy level before rallying to my 31825 T/P level with a late high at 32040. The Dow continues to attract large buying at its 50 Day Moving Average. This is the first time since March that we have seen a sustained move above the 50 MA for both the Dow and S&P. Please read yesterday’s DC for my inflation predictions, because if I am right this bull market for stocks will quickly resume. There is a better than even chance that last month’s 3635 low print in the S&P is the low for the year. Today, I will again be a buyer of the Dow on any dip lower to 31500/31770 with the same 31295 wider ‘’Closing Stop’’.  The ‘’Fear & Greed Index continues to improve, closing at 42 which is still a reading of ‘’Fear’’. A 50 print is neutral and when this happens it should propel the Dow higher given the level of bearishness amongst traders and Fund Managers.

Cash NASDAQ 100

The NDX had a nice rally yesterday and is now back trading at 12530. I will not add to my position, preferring to exit my 14327 existing long position at 12900. The points earned this week will help pay for the NDX loss if and when it is triggered. If this view changes I will be back with a new update for my Platinum Members.

September BUND

My Bund plan worked well with the market hitting my 150.60 buy level on the Dragi news before rallying to my 151.10 T/P level. Subsequently, I emailed my Platinum Members to buy the Bund over the ECB announcement at 150.10 before the market surged, hitting my 150.95 T/P level and I am now flat. The Bund liked the 50 basis point rate hike, trading at 152.40 this morning – 250 points higher than the post ECB rate hike low print. The Bund has strong support from 150.90/151.60 where I will again be a buyer with a 150.35 higher ‘’Closing Stop’’.

Gold Rolling Contract

Hindsight is a great thing. I should have left my Gold buy level from Wednesday with the market trading $40 higher than yesterday’s 1680 low print. I am still flat. I will now raise my buy level to 1689/1704 with a tight 1675 ‘’Closing Stop’’.

Silver Rolling Contract

No Change. I am still long from yesterday morning at 18.45 with the same 18.90 T/P level. I will add to this position at 17.75 while leaving my 16.95 ‘’Closing Stop’’ unchanged. If any of the above levels are hit I will be back with a new update for my Platinum Members.