U.S. stocks advanced as investors ramped up bets that the Federal Reserve will cut Interest Rates this month to shore up an economy showing increasing signs of weakness. Treasuries rallied. The S&P 500 rose the most in a month after roaring back from a drop of more than 1% sparked by the weakest reading on the Services Sector in three years. Odds the Federal Reserve cuts Rates at its next meeting spiked as the data came just after the worst factory numbers in a decade. Investors are also finding their footing after the benchmark fell around 3% over the last two sessions, with one of the hardest hit sectors, tech, pacing gains. The yield on 10-year Treasuries dropped for the sixth straight day, while the US Dollar fell for a third time in a row. In other news, Prime Minister Boris Johnson was given a week by the European Union to revise his Brexit deal or risk a humiliating postponement of the U.K.’s departure just as support was building at home for his plan. The EU’s chief negotiator, Michel Barnier, told a private meeting of European senior diplomats that the latest British blueprint for post-Brexit arrangements along the border with Ireland fell far short of his conditions for a deal, three EU officials said. Meanwhile, there were signs an accord might finally get through the U.K. Parliament as some Brexit hard-liners and those on the pro-EU side of the governing Conservative Party said they would fall into line.
To mark my 1925th 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 firstname.lastname@example.org for details
For anyone following my Platinum Service it made 408 points yesterday and is now ahead by 209 points for October, having made 1620 points in September, 2387 points in August, 1153 points in July, 1346 points in June,1722 points in May, 955 points in April and 1027 points in March. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
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This week’s march of weak data confirmed investor concerns that the global economy is struggling for traction, and may be seeping from the manufacturing sector into consumer sentiment, as the U.S.-China trade war churns in the background. That’s also driving bets that the Fed will pump more stimulus into the economy this year. Focus now turns to the Non-Farm Payrolls figure this afternoon, when Federal Reserve Chairman Jerome Powell will also speak. This downturn is starting to spread and that means the tea leaf readers at the Fed are going to be teeing up a third rate cut this year when they next meet again at the end of this month. Policymakers are going to need a bigger gun to stop this avalanche of bad news from dragging down business and consumer confidence even further.
The S&P 500 Index rose 0.8%, the most since Sept. 5, closing at a price of 2910, which was above its afternoon low of 2854.
The Nasdaq Composite Index gained 1.1%, while the Dow Jones Industrial Average added 0.5%.
The Stoxx Europe 600 Index was little changed.
FTSE 100 Index dropped 0.6%.
Here is a summary of the main Changes in F.X Markets:
The Bloomberg Dollar Spot Index declined 0.2%.
The Euro rose 0.1% at $1.0970.
The British Pound climbed 0.3% to $1.2350.
The Japanese Yen rose 0.3% to 106.88 per dollar.
The yield on 10-year Treasuries dipped six basis points to 1.53%.
The yield on two-year Treasuries fell nine basis points to 1.39%.
Germany’s 10-year yield sank five basis points to -0.60%.
Britain’s 10-year yield decreased four basis points to 0.458%.
West Texas Intermediate crude fell 0.7% to $52.26 a barrel.
Gold rose 0.2% to $1,511.00 an ounce.
This morning on the Economic Front we have no data of note from either the Euro-Zone or the UK. At 1.30 pm we have the U.S Non-Farm Payrolls. Consensus is for 145,000 jobs, but the whisper number is 122,000. Also at this time we will have the Unemployment Rate, the all-important Average Earnings and the Trade Balance. We have no other data. However, we have a number of Fed Members speaking namely, Rosengren, Fed Chair Powell, Brainard, George and Quarles at 1.30 pm, 7.00 pm, 7.10 pm, 8.45 pm and 9.00 pm respectively. Obviously, the key speech to watch will be Powell whose take on the economy could be significant.
December S&P 500
For the third consecutive trading session the S&P traded the whole of my buy range before in contrast to the other two sessions, turned around and rallied hard. This move lower saw the S&P leaving me with an average long position at 2866 before rallying to my 2881 T/P level and I am now flat. The S&P reversed upward from chart support near its August low and this rally continued overnight to hit a high of 2918. We have two key events this afternoon which will determine the whether the S&P is going to test its 200 Day Moving Average at 2839 or rally back to its 50 Day Moving Average which comes in at 2943 this morning. Despite the nice reversal in the market yesterday a lot of technical damage has been done to the market this week. The S&P will have strong resistance from 2939/2952 and I will be a seller in this area with a 2961 stop. I mentioned yesterday that the S&P had strong support from 2860/2880 and needed to bounce of this key support area or else we could see a further acceleration to the downside. Today I will again look to buy the S&P from 2878/2890 with a 2869 stop. If the S&P does sell-off to my buy area following the NFP release we should see a rebound ahead of Fed Chair Powell’s speech at 7.00 pm.
When the Euro hit a low for the year at 1.0879 earlier this week the Daily Sentiment Reading was in single digits with a 9% bullish reading. Yet again the DSI has proved what a fantastic short-term trading signal it is with the Euro rallying to test 1.10 yesterday afternoon. I am still flat the Euro and ahead of the NFP I will leave my 1.0870/1.0920 buy level unchanged with the same 1.0835 stop.
December Dollar Index
No Change as I am still a small seller on any rally higher to 99.05/99.45 with a 99.75 stop.
As my other four Indices had hit my buy level and along with the DAX I did not buy this market as I had enough exposure. For those of you who did buy this market then this plan worked well with the market rallying nearly 200 points off the 11805 low print. Today I will again look to buy the market on any dip lower to 11805/11865 with a 11755 stop.
My FTSE plan worked well with the market trading the whole of my buy range for a 6995 average long position before rallying to my revised 7028 T/P level and I am now flat. This morning the FTSE is trading higher at 7075, helped by the slight weakening of Sterling from yesterday’s 1.2420 high. Today I will again look to buy the market from 6970/7020 with a 6935 stop which is just below yesterday’s low print.
Dow Rolling Contract
My Dow plan worked very well yesterday as the market having tested its key 200 Day Moving Average turned around and rallied over 500 points off its 25733 low print. As I was already long the S&P, FTSE and NASDAQ I waited to buy the Dow which I did at a price of 25800 before the market rallied to my 25980 T/P level and I am now flat. In addition the Dow rallying off its 200 Day MA, its 9 – Day RSI line also rebounded from a short-term oversold reading below 30. Today I will again look to buy the Dow on any move lower to 25860/26020 with a 25780 tight stop. Ahead of the weekend I do not want to be short the Dow as I have a sell level above the market in the S&P.
The NASDAQ also bounced off its 200 Day MA as Technology stocks led the rally. My NASDAQ plan also worked well with the market trading lower to my 7500 buy level before rallying to my 7545 T/P level and I am now flat. Incredibly the market hit a high of 7680 overnight. Today I will again look to buy the market on any dip lower to 7520/7580 with a 7460 stop.
Late in the afternoon the Bund rallied to my 174.70 sell level. I am still short and I will now raise my T/P level on this position to 174.48. If my T/P level is not executed I will add to this position on a move higher to 175.20 with a 175.55 stop. If any of the above levels are executed I will be back with a new update for my Platinum Members.
Gold Rolling Contract
No Change as my only interest in buying the market is still from 1470/1482 with a 1461 stop.
Silver Rolling Contract
I am still flat Silver and today I will continue to be a buyer on any dip lower to 16.90/17.30 with a 16.45 stop. If I am taken long I will have a T/P level at 17.50.