U.S. stocks halted a three-day advance mixed after disappointing results from Goldman Sachs Group Inc. and Citigroup Inc. dragged down bank shares. Crude slumped towards $63 a barrel in New York. The S&P 500 Index slipped from a six-month high as the U.S. corporate earnings season kicks into high gear. Goldman slumped 3.8 percent for the biggest drop in the Dow Jones Industrial Average after missing estimates for sales and trading revenue. Citigroup also retreated after its revenue matched expectations. The Bloomberg Commodity Index slid as Natural Gas and Crude Futures retreated. European stocks edged higher, as losses in mining shares offset increases in media and insurance. The Euro strengthened for a second day. In Asia, equities approached a fresh six-month high, propelled by markets in Japan and Korea, following the Bank of China’s release of upbeat credit data late Friday. With Chinese trade and lending data showing signs of improvement for the world’s second-biggest economy, investors are turning to the U.S. earnings season to confirm the resilience of corporate America in the face of numerous challenges to growth. JP Morgan Chase & Co. posted strong first-quarter results last week, and Bank of America Corp. is up today. Central banks remain in the picture, with President Donald Trump renewing his attack on the Fed leadership over the weekend, saying the stock market would be “5,000 to 10,000” points higher had it not been for the actions of U.S. policy makers.
To mark my 1800th 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 bryan@tradernoblecom for details
For anyone following my Platinum Service it made 100 points yesterday and is now ahead by 512 points for April, having made 1027 points in March, 1013 points in February, 1671 points in January, 2803 points in December, 1541 points in November and 2094 points in October. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
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Even though the S&P 500 fell 0.1 percent yesterday, futures markets are higher overnight as the ‘’buy the dip’’ shows no sign of ending. The Dow also closed 0.1 percent lower while again the NASDAQ was the strongest Index closing at yet another year to date high. Meanwhile in Europe the Stoxx Europe 600 Index rose 0.2 percent. Topix index gained 1.4 percent with the first advance in more than a week. Emerging market stocks pared early gains, while still heading for its 12th increase in 13 sessions.
With Currency volatility at a five year low it is no surprise that we are seeing little price action in the main G7 currencies. The Bloomberg Dollar Spot Index rose 0.1 percent while the Euro closed above $1.13 after a second consecutive day of gains. The MSCI Emerging Markets Currency Index advanced 0.1 percent to the highest in more than three weeks. Meanwhile the South Korean Won rose 0.6 percent which was the biggest jump since January.
On the back of the slightly weaker Equity Markets the yield on two-year Treasuries slipped one basis point to 2.3854 percent while the yield on 10-year Treasuries fell two basis points to 2.545 percent. In Europe, Germany’s 10-year yield climbed less than one basis point to 0.056 percent.
West Texas oil contracts slipped after the longest run of weekly gains in three years as a report showed increased U.S. oil-rig activity closing at $63.50. Brent crude also fell 0.4 percent to $71.25 a barrel. In metals, Gold futures declined 0.3 percent to $1,291 an ounce and Platinum dipped 1.6 percent to $884.40 an ounce, the lowest in more than a week on the largest decrease in more than two weeks.
This morning on the Economic Front we have UK Unemployment and Average Earnings at 9.30 am. This is followed by the German and Euro-Zone ZEW Survey at 10.00 am. Also at 10.00 am we have Euro-Zone Construction Output. At 2.15 pm we have US Capacity Utilisation and Industrial Production. Finally at 3.00 pm we have the NAHB Housing Market Index.
At 7.00 pm the Fed’s Kaplan is speaking on the Economy.
June S&P 500
My S&P plan worked well with the market trading lower to my 2903 buy level before rallying to my 2909 T/P level and I am now flat. The S&P made a rebound high of 2912 overnight as yet again the buy the dip wins the day. One word of caution is the fact that the Daily Sentiment Index again closed at 90% bulls on Friday night. This close pushed the 10-day DSI to its highest level since the days surrounding the January 2018 high. As long as the S&P can hold the now key support level at 2870 I will continue to be a buyer on dips. Today I will again look to buy the S&P on any dip lower to 2895/2904 with a 2887 stop. The S&P hast strong resistance at its all-time high of 2940 and my sell level will be unchanged from 2935/2945 with the same 2952 stop.
I am still flat the Euro and today I will leave my 1.1220/1.1260 buy level unchanged with a 1.1185 stop.
June Dollar Index
The boring sideways action in the Dollar continues and I am still flat. I am still a seller on any rally higher to 96.95/97.35 with a 97.35 stop.
The DAX has now closed above the key 11800 support level for the fifth consecutive trading session, despite the near record low Bund Yields and weak economic growth. I am still flat and today I will again raise my buy level to 11900/11970 with a 11835 tight stop.
Following the six and half months extension between now and the new Brexit deadline on October 31, my own view is Britain has three possible outcomes to the end of this three year saga.
1 A Norwegian style ‘’Brexit In Name Only’’, including membership of the European Single Market and/or Customs Union.
2 A multi – year negotiation towards a free trade agreement similar to the FTAs between Europe and Canada or Japan.
3 A decision to abandon the whole Brexit process and reverse the 2016 Referendum.
In my view if any of the above scenarios play out then the Pound rises and is why I continue to be bullish of Sterling by buying the dip in Cable. With this in mind it is difficult to be long the FTSE given how severely overbought it is. Today I will leave my 7425/7460 sell level unchanged with the same 7495 tight stop.
Dow Rolling Contract
My Dow plan worked well yesterday as no matter which of my three US Indices you bought as all three had nice rallies. As the three contracts hit more or less at the same time after the Dow traded lower to my 26340 buy level I covered this position at my revised 26360 T/P level and I am now flat. Today I will again look to buy the Dow on any dip lower to 26190/26330 with a 26080 wider stop. I still do not want to be short the Dow at this time.
After the NASDAQ traded lower to my 7605 buy level I covered this position too early at 7625 and I am now flat. This morning the market is trading at 7670 and I will again look to buy the NASDAQ on any dip lower to 7585/7625 with a 7545 stop. I no longer want to be a seller of the NASDAQ at this time believing that higher prices will continue.
No Change as I m still a small seller on any rally higher to 165.10/165.50 with a 165.85 stop.
Gold Rolling Contract
Despite the weaker US Dollar Gold is weak. I am still flat and I will continue to be a buyer on any dip lower to 1267/1275 with a 1259 lower stop.
Silver Rolling Contract
No Change as I am still long from last week at 15.15 with the same 15.25 T/P level and 14.50 stop. I will continue to look to add this existing long position on any further dip lower to 14.70. If any of the above scenarios play out I will be back with a new update for my Platinum Members.