U.S. Equity Markets bounced around before briefly spiking after the Federal Reserve’s policy announcement, finishing the day mixed as the S&P again closed flat while the Dow finished with a loss of 0.48%. Markets were choppy again before the Fed’s policy announcement, which was the big story of the day. The Federal Open Market Committee ended its two-day meeting, saying it planned to hold its benchmark Interest Rate near zero. The central bank also said it would continue its Monthly Asset Purchases. In his post-meeting press conference, Fed Chair Jerome Powell said the central bank was not discussing tapering its asset purchases. The lack of tapering is what sent markets higher, as Wall Street had built up expectations (and fears) that the Fed was going to pull out of the bond market. Another catalyst at work was Big Tech earnings. Alphabet (GOOGL) and Microsoft (MSFT) both put up good numbers yesterday, while Visa’s (V) report showed a rebound in consumer spending. Markets sold off into the close on little news. Earnings will continue to be a focus, with Amazon (AMZN) reporting tomorrow. European Markets closed higher. The European Commission President Ursula von der Leyen said the European Union’s $906 billion stimulus plan could play a major role in rebuilding the regional economy. S&P Global said the EU’s recovery plan could boost the region’s economy by as much as 4.1% over the next five years. The European Union’s “”vaccinations increased to 134.8 million yesterday, with a daily average of 2.8 million doses administered last week. Portuguese President Marcelo Rebelo de Sousa said the country’s COVID-19 state of emergency would end on Friday, with the government easing social-distancing measures as well. But it was not all good news… German Consumer Sentiment fell unexpectedly, as rising COVID-19 cases led to stricter lockdowns. In Asia, Japan’s Retail Sales data for March were greater than expected, indicating that the nation’s economy is recovering despite new COVID-19 restrictions. South Korean Consumer Sentiment increased for the fourth straight month in April to nearly pre-pandemic levels thanks to export strength and vaccine optimism. Australia’s First-Quarter Consumer Price Index data were weaker than anticipated, highlighting that inflation remains tame. Elsewhere, Oil rose 1.14% after the Energy Information Administration reported the U.S.’s inventory build wasn’t as large as initially estimated while both Gold and Bitcoin closed flat.
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The S&P 500 closed 0.08% lower at a price of 4183.
The Dow Jones Industrial Average closed 164 points lower for a 0.48% loss at a price of 33,820.
The NASDAQ 100 closed 0.42% lower at a price of 13,901.
The Stoxx Europe 600 Index closed 0.4% higher.
Yesterday, the MSCI Asia Pacific Index rose 0.1%.
Yesterday, the Nikkei closed 0.21% higher at a price of 29,053.
The Bloomberg Dollar Spot Index closed 0.2% lower
The Euro closed 0.3% higher at $1.2120.
The British Pound closed 0.3% higher at $1.3940.
The Japanese Yen closed 0.1% higher at 108.62 per dollar.
Germany’s 10-year yield closed one basis points higher at -0.23%.
Britain’s 10-year yield closed two basis points higher at 0.80%.
US 10 Year Treasury closed two basis points lower at 1.61%.
West Texas Intermediate crude closed 1.14% higher at $63.72 a barrel.
Gold closed 0.13% higher at $1,779.10 an ounce.
This morning on the Economic Front we have German Unemployment at 8.55 am. This is followed at 9.00 am by Euro-Zone Money Supply, Consumer Sentiment and the Economic Sentiment Indicator.
June S&P 500
My S&P plan worked well with the market trading higher to my 4191 buy level before selling off to my 4181 revised T/P level and I am now flat. Despite a supportive Fed, the S&P struggled yesterday as so much news is priced in as alluded by me on numerous occasions over the past six weeks. I will not chase the S&P higher and I will continue to be a buyer on any dip lower to 4160/4175 with a higher 4148 ‘’Closing Stop’’. As I go to press the S&P is rallying on the back of better results from Apple. The S&P has resistance from 4205/4221 where I will again be a seller with a 4235 ‘’Closing Stop’’.
No Change. I am still flat and I will continue to be a seller from 1.2155/1.2195 with the same 1.2235 stop. I will now raise my buy level to 1.1995/1.2045 with a higher 1.1955 stop.
June Dollar Index
Late in the New York session the Dollar traded lower to my 90.50 buy level. I am still long and I will now lower my T/P level to 90.80. I will now raise my stop on this position to 90.15.
I am still flat and I will now raise my buy level to 15100/15170 with a higher 15045 tight stop. If I am taken long I will have a T/P level at 15215.
I am still flat and I will now raise my buy level to 6840/6890 with a higher 6795 stop. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
After the Dow traded lower to my 33810 buy level we rallied 120 points after the FOMS Statement, allowing me to cover this position at my 33875 revised T/P level and I am still flat. Although the Dow traded heavy all-day yesterday, we have strong support from 33600/33750 where I will be a buyer with a 33455 ‘’Closing Stop’’. I still do not want to be short the Dow at this time.
My NASDAQ plan worked well with the market trading lower to my 13880 buy level before rallying to my 13915 revised T/P level and I am now flat. I will continue to be a seller from 14055/14140 with the same 14225 ‘’Closing Stop’’. The NASDAQ has support from 13820/13910 where I will again be a buyer with a 13735 ‘’Closing Stop’’.
The Bund traded lower to my 170.20 buy level before rallying to my 170.45 revised T/P level and I am still flat. Today, I will again be a buyer from 169.80/170.20 while leaving my 169.55 tight stop unchanged.
Gold Rolling Contract
I am still flat and I will now raise my buy level to 1748/1760 with a higher 1739 tight stop.
Silver Rolling Contract
I will now raise my buy level to 25.30/25.90 with a higher 24.85 stop.