U.S. Equity Markets surged yesterday following the 0.75% rate hike by the Fed on what could well turn out to be last hike for many months. This move higher saw the VIX close lower by 6% as the NASDAQ 100 led the rally with a gain of 4.26%. Markets rose as better-than-expected forward guidance from big tech companies fuelled a rally. The Federal Open Market Committee announced a 0.75% interest-rate hike. Fed Chairman Jerome Powell reiterated the Fed’s commitment to quell high inflation. He asserted that the U.S. is not currently in a recession but conceded that achieving a soft landing has become more challenging in recent months. Powell said that growth needs to slow, and unemployment needs to rise to more natural levels to achieve price stability. He asserted that the central bank would no longer provide forward guidance now that rates have reached neutral. Within the S&P 500, all 11 sectors finished higher. European Markets closed higher. Earnings from travel, technology, and media companies boosted markets, thanks to positive forward guidance. However, recession woes continue to plague Euro-Zone economies as Consumer Confidence in Germany, France, and Italy all sharply decline. Also, gas prices have risen 30% in two days as Russian energy imports are curtailed. In Asia, markets closed mixed on Wednesday. Australia’s second-quarter inflation came in softer than expected, pacifying bullish sentiments earlier in the week for higher rate hikes. Meanwhile, South Korea’s consumer survey showed inflation expectations accelerated faster in July than in June. Japan and other countries are ramping up purchases of liquid natural gas as Russia’s energy supply is expected to remain historically low. China continues to battle sporadic outbreaks of COVID-19, which could spark volatile trading as lockdown fears re-emerge. Elsewhere, Oil closed 3.36% higher while Gold rose 1% on Dollar weakness.

To mark my 2600th 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 67 points yesterday and is now ahead by 3942 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 2.62% higher at a price of 4023.

The Dow Jones Industrial Average closed 436 points higher for a 1.37% gain at a price of 32,197.

The NASDAQ 100 closed 4.26% higher at a price of 12,601.

The Stoxx Europe 600 Index closed 0.6% higher.

This morning, the MSCI Asia Pacific Index rose 0.4%.

This morning, the Nikkei closed 0.28% higher at a price of 27,793.

Currencies 

The Bloomberg Dollar Spot Index closed 0.7% lower.

The Euro closed 0.6% higher at $1.0193.

The British Pound closed 0.8% higher at 1.2150.

The Japanese Yen rose 1.1% closing at $135.55.

Bonds

Germany’s 10-year yield closed 2 basis points higher at 0.95%.

Britain’s 10-year yield closed 4 basis points higher at 1.95%.

US 10 Year Treasury closed 2 basis points lower at 2.79%.

Commodities

West Texas Intermediate crude closed 3.36% higher at $100.15 a barrel.

Gold closed 0.98% higher at $1731.10 an ounce.

This morning on the Economic Front we have Euro-Zone Consumer Confidence, Business Climate and Economic Sentiment Indicator at 10.00. Next, we have German CPI at 1.00 pm, followed by U.S. Weekly Jobless Claims and GDP at 1.30 pm. Finally, at 3.30 pm we have the Kansas Fed Manufacturing Activity Index.

Cash S&P 500

A dovish 75 basis point rate hike following by Fed Chair Powell opening the door to closing rate hikes, and without saying it stopping them altogether if inflation data slows down materially. They know the economy is slowing down hard as shown by the guidance from companies who have already reported earnings and if as I expect we see a dramatic fall in inflation over the coming months, the equity markets will rally hard. Bears are not dead given the dramatic 25 Handle sell-off into the close as we wait for this evening’s earnings from both Amazon and Apple as well as the PCE Report tomorrow. The S&P again pushed outside the top of its Bollinger Band so a pullback makes sense while the McClellan Oscillator is close to being overbought closing at +202 last night. The S&P rallied an incredible 120 Handles yesterday, hitting a high of 4040. This move higher has me short at an average rate of 4012 with the same 4031 tight ‘’Closing Stop’’. I will now raise my T/P level on this position to 3998 and if any of the above levels are hit, I will be back with a new update for my Platinum Members.

EUR/USD

The Euro had a nice rally following Powell’s press conference as the market hit my 1.0180 T/P level on my latest 1.0150 long position and I am now flat. This morning the Euro is opening higher at 1.0220. We have strong support from 1.0110/1.0170 where I will again be a buyer with a 1.0065 tight stop. I still do not want to be short the Euro at this time.

March Dollar Index

The Dollar just missed my 107.40 sell level by 10 points before getting hit hard, closing down 0.7%. It looks more and more likely that a top of some significance was made two weeks ago at 109.50, with the Dollar trading over 3% lower at 106.05 this morning. Today, I will again be a seller from 106.70/107.40 with a 108.05 stop. If I am taken short I will have a T/P level at 106.25.

Cash DAX

Frustratingly, the DAX missed my 13050 buy level by 35 points yesterday morning before rallying to sit at 13235 this morning and I am still flat. Yesterday, was the second consecutive trading session in a while where negative news for Germany got bought. I will now raise my DAX buy level to 13030/13110 with a tight 12975 stop.

Cash FTSE

Just before the New York close the FTSE rallied to my 7380 sell level. I am still short and I will add to this position at 7440 while leaving my 7475 tight stop unchanged. I will now raise my T/P level to 7345 and if any of the above levels are hit I will be back with a new update for my Platinum Members.

Dow Rolling Contract

Tuesday’s late sell-off in the Dow was another ‘’Bear Trap’’ as the market reversed all of those losses, closing 1.37% higher at 32200. With sentiment on the floor and Fund Managers so underweight American Indexes there is every possibility of a melt-up in the market, similar to the one that occurred in mid-March. The Dow has now closed over its 50 Day MA for the seventh consecutive session. This support level is now becoming more and more important. However, we are seeing some negative divergence at yesterday’s highs so a small pull back makes sense before we see the next leg-up. I have no interest in chasing the Dow lower as I am already short the S&P. The Dow has support from 31800/32050 where I will be a buyer with a tight 31655 ‘’Closing Stop’’.  Surprisingly, the ‘’Fear & Greed Index only rose slightly last night, closing at 38 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 its strongest day in over two years yesterday, closing higher by over 500 points for a 4.26% gain. We are getting closer to my exit level on April’s foolishly 14327 long position and I will use this month’s points gain to exit this position. I will now lower my exit level to 12650 and if this price is triggered, I will be back with a new update for my Platinum Members.

September BUND

My Bund plan worked well with the market trading higher to my 156.20 sell level before trading lower to my 155.83 revised T/P level ahead of the Powell Press Conference and I am still flat. The Bund is severely overbought after rallying over 1500 points this month as one short position after another has been slammed. The Bund has resistance from 156.10/156.70 where I will again be a seller with a 157.35 ‘’Closing Stop’’.

Gold Rolling Contract

Gold fell shy of yesterday’s initial 1704 buy level with a 1713 low print before rallying on Powell’s post FOMC comments. I will now raise my buy level to 1700/1714 with a higher 1689‘’Closing Stop’’.

Silver Rolling Contract

Silver has surged over 4% since I marked prices 24 hours ago and I am still flat. The big question is did Silver finally put in a meaningful bottom at this week’s 18.30 low print? It is too early to say but a 4% rally is a nice start. Today, I will be a buyer of Silver from 18.50/19.10 with a 17.95 stop.