U.S. Equity Markets sold off sharply, finishing the lower after posting their biggest loss since October, led by the NASDAQ 100 which closed 2.80% in the red. Markets sold off sharply at the open and remained at their low levels for the remainder of the day. The retail investor frenzy was in the headlines once again, with shares of heavily shorted names soaring again. This sparked fears of potential bubbles in asset valuations, as well as too much “froth” in the stock market. On the Vaccine front, President Joe Biden said the U.S. will buy 100 million additional Coronavirus vaccine doses each from Pfizer and Moderna, giving the country enough supply to vaccinate all Americans. The Federal Reserve left Interest Rates unchanged, as expected. The central bank also said that it will continue to work to support the economy. In his post-policy press conference, Fed Chair Jerome Powell said the Fed will not taper its Asset Purchases anytime soon. Powell added that economic activity has moderated in recent weeks, but the ongoing vaccine rollout was a reason for optimism later in the year. Earnings were still in focus, with some Big Tech earnings still on the way. European Markets also closed lower on weaker than expected Economic data. Germany’s DIW Institute projected a 3% first-quarter contraction for the country’s economy, as the government maintains strict social-distancing restrictions throughout February. German Consumer Confidence data for February were weaker than anticipated, falling versus January, as ongoing lockdowns erode household optimism. But it was not all bad news. French pharmaceutical giant Sanofi agreed to manufacture 125 million doses of Pfizer and BioNTech’s coronavirus vaccine in an effort to speed up distribution. European Central Bank Governing Council Member Klaas Knott said it has tools to counter a strong Euro, including more interest rate cuts. Elsewhere Oil again closed flat despite a larger-than-expected drawdown in U.S. crude inventories while Gold fell 0.50% on U.S Dollar strength.
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For anyone following my Platinum Service it lost 815 points yesterday and is now ahead by 1159 points for January, having finished December with a gain of 2273 points, 2025 points in November, 2779 points in October, 3042 points in September, 2383 points in August, 3128 points in July, 2580 points in June, 2456 points in May, 4773 points in April, and an incredible 9264 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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The S&P 500 closed 2.57% lower at a price of 3750.
The Dow Jones Industrial Average closed 633 points lower for a 2.05% loss at a price of 30,303.
The NASDAQ 100 closed 2.80% lower at a price of 13112.
The Stoxx Europe 600 Index closed 1.2% lower.
The MSCI Asia Pacific Index fell 0.3%.
Yesterday, the Nikkei closed 0.31% higher at a price of 28,635.
The Bloomberg Dollar Spot Index closed 0.4% lower.
The Euro closed 0.5% lower at $1.2112.
The British Pound closed 0.5% lower at $1.3680.
The Japanese Yen closed 0.5% lower at 104.07 per dollar.
Germany’s 10-year yield closed two basis points lower at -0.55%.
Britain’s 10-year yield closed one basis points lower at 0.26%.
US 10 Year Treasury closed two basis points lower at 1.01%.
West Texas Intermediate crude closed flat at $52.30 a barrel.
Gold closed 0.50% lower at $1,835.20 an ounce.
This morning on the Economic Front we have Euro-Zone Consumer Confidence and the Economic Sentiment Indicator at 10.00 am. This is followed buy German CPI at 1.00 pm and the U.S Weekly Jobless Claims, GDP, Trade Balance and Wholesale Inventories at 1.30 pm. Finally, we have New Home Sales at 3.00 pm.
March S&P 500
One of the most brutal trading days since October with the S&P falling 150 Handles from Tuesday’s 3861 latest all-time high. The S&P accelerated to the downside after the key 3800 support area was broken. The 3775/3795 area should act as strong support after yesterday’s significant Downside Reversal, I will be a seller in this area with a 3810 stop. The S&P has rebounded off overnight lows at 3704 to sit at 3740 as I go to press. With the VIX surging 61% yesterday I would expect plenty of two-way price action. It is unlikely that we will leave such a large ‘’Open Gap’’ from last night’s Chicago close. We have short-term support from 3689/3709 where I will be a buyer with a 3669 stop. If I am taken short I will have a T/P level at 3756. If I am taken long I will have a T/P level at 3725.
The Euro traded the whole of my buy range for a now 1.2097 average long position. I will leave my stop unchanged at 1.2045 while lowering my T/P level to 1.2130.
March Dollar Index
One of the few bright spots from yesterday was my long 90.10 position as the market rallied to my 90.35 T/P level and I am now flat. Today, I will again be a buyer from 89.80/90.30 with a 89.35 stop.
The DAX traded the whole of my buy range for a 13680 long position before stopping me out of this trade at 13585 and I am still flat. The break and close below 13500 is bearish but I would like to wait one more day before committing to a short position. As a result, I will stay flat the DAX until tomorrow.
For conservative traders the FTSE is a nice contract to trade as you do not have the same points moves as the other main Indices. After the FTSE traded lower to my 6505 buy level the market held in until the US Indices plunged in the last 30 minutes of trading and I was stopped out of this position at 6435 and I am now flat. The FTSE has support from 6340/6390 where I will again be a buyer with a 6285 stop. If I am taken long I will have a T/P level at 6435.
Dow Rolling Contract
My Dow plan did not work well with the market trading the whole of my buy range for a 30615 long position before stopping me out of this trade at 30395 and I am still flat. The Dow has support from 29850/30050 where I will again be a buyer with a 29675 ‘’Closing Stop’’. If I am taken long I will have a T/P level at 30195.
Incredibly after the NASDAQ traded lower to my 13520 T/P level on my latest 13580 short position, the market made a low at 12900 before rallying nearly 200 points into the close. The VIX exploded yesterday, closing 61% higher at a price of 37.21 and is now well above both its 50 and 200 Day Moving Averages. The NASDAQ has strong support from 12780/12890 where I will be an aggressive buyer with a wider 12630 stop, which is just below the 50 Day Moving Average.
The BUND again missed my buy level before rallying and I am still flat. I will now raise my buy level to 177.00/177.40 with a higher 176.55 stop.
Gold Rolling Contract
My Gold plan worked well with the market hitting my 1824 buy level before rallying to my 1832 T/P level. Gold has strong support from 1800/1812 where I will again be a buyer with a 1789 stop.
Silver Rolling Contract
After Silver traded lower to my 24.80 buy level we rallied to my 25.15 T/P level and I am now flat. Today, I will be a buyer from 23.90/24.50 with a 23.35 stop.