U.S. Equity markets finished the day higher despite slower Economic growth, led by the 0.75% rally in the NASDAQ 100. Markets rose Monday as signs of an economic slowdown continue to emerge. The August Empire State Manufacturing Survey fell 42 points month over month (“MOM”) to -31.3, missing consensus by a wide margin and marking the second-lowest print on record. Elsewhere, the August National Association of Home Builders Housing Market Index fell five points MOM to 49 – the lowest point since May 2020. Economists also predict that single-family housing starts will decline for the first time since 2011. Slowing household consumption will ease inflation growth… Over the last couple of years, most Americans have been buoyed by the financial security of government handouts… stimulus payments, loan forbearance, and tax credits, among others. This led to an increased pandemic-era savings rate. But all that financial security is quickly drying up. Signs continue to mount that many families are underwater on household cash flow. While wages are up from 2019 levels, inflation has driven costs even higher. This has resulted in an explosion in credit-card account openings, usage, and debt. While that may create the near-term optics of a healthy consumer… longer term, the dynamic will destroy disposable income at an even faster rate. Because servicing credit cards typically comes at a high cost due to interest rates. That means more money to keep households in good standing and less to spend on wants and needs. The result will be a further slowdown in economic output, bringing it back to pre-pandemic levels of consumption. The drop in demand should help to ease inflation growth going forward. And that, in turn, will support the Federal Reserve slowing or even pausing interest-rate hikes going forward. Within the S&P 500, nine of 11 sectors finished higher. European Markets closed higher. Analysts expect another 0.50% rate hike by the Bank of England in September as it attempts to ease soaring inflation. Economists now say that the risk of a Euro-Zone recession is at its highest level since November 2020, at 60%. President of the Federal Network Agency Klaus Müller, in charge of energy rationing, said that Germany must cut gas consumption by 20% ahead of the winter to avoid rationing. In Asia, The People’s Bank of China surprisingly cut interest rates following disappointing economic data. Multiple metrics point toward a declining domestic economy in China as Industrial Production, Retail Sales, and Fixed-Asset investment all came in lower than consensus for July. China’s lending environment also continues to falter as house prices fall for the 11th straight month. Elsewhere, Oil closed 3.44% lower while Gold fell 1.28% on further Dollar strength.

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 245 points yesterday and is now ahead by 1548 points for August, having made 2660 points in July, following a gain of 3371 points in June. The Service made 3651 points in May, after making 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 0.4% higher at a price of 4297.

The Dow Jones Industrial Average closed 151 points higher for a 0.45% gain at a price of 33,912.

The NASDAQ 100 closed 0.75% higher at a price of 13,667.

The Stoxx Europe 600 Index closed 0.7% higher.

Yesterday, the MSCI Asia Pacific Index rose 0.8%.

Yesterday, the Nikkei closed 1.14% higher at a price of 28,871.

Currencies 

The Bloomberg Dollar Spot Index closed 0.8% higher.

The Euro closed 0.8% lower at $1.0165.

The British Pound closed 0.7% lower at 1.2054.

The Japanese Yen rose 0.1% closing at $133.31.

Bonds

Germany’s 10-year yield closed 8 basis points lower at 0.91%.

Britain’s 10-year yield closed 9 basis points lower at 2.02%.

US 10 Year Treasury closed 5 basis points lower at 2.79%.

Commodities

West Texas Intermediate crude closed 3.44% lower at $87.82 a barrel.

Gold closed 1.28% lower at $1779.10 an ounce.

This morning on the Economic Front we have U.K. Unemployment and Average Earnings at 7.00 am. This is followed by the German and Euro-Zone ZEW Survey at 10.00 am. Next, we have U.S. Building Permits and Housing Starts at 1.30 pm. Finally, at 2.15 pm we have Industrial Production and Capacity Utilization.

Cash S&P 500

If markets were all tied to fundamentals then yesterday would have been a big down day. The U.S. reported massive misses on the Economic Front that saw traders buy the dip which in turn helped drive the S&P to new rebound highs as China surprisingly cut rates early yesterday morning which in turn drove the Dollar higher. New Orders on the NY Empire State Forecast dropped to -29% while Home Builder Sentiment dropped into negative territory with a 49 print. This move higher saw the Dow tag its 200-Day Moving Average while the S&P is still shy by 26 Handles. The 14-Day RSI became more overbought closing at 72.60 while the small Cap RSI hit 75. The McClellan Oscillator did not follow the S&P higher closing lower with a print of + 192. I am still flat the S&P as both my buy and sell ranges missed by a few handles before moving. Today, I will raise my S&P sell level to 4312/4332 with a higher 4349 ‘’Closing Stop’’. The S&P has now left seven sizeable ‘’Open Gaps’’ over the past few weeks and as you all know all gaps eventually get filled. The S&P has short-term support from 4215/4235 where I will continue to be a small buyer with the same 4199 ‘’Closing Stop’’.

EUR/USD

The Euro got hit hard yesterday, trading lower to my 1.0200 buy level. I will continue to look to add to this position at 1.0130 while lowering my T/P level to 1.0240. I will leave my 1.0085 stop unchanged and if any of the above levels are hit I will be back with a new update for my Platinum Members.

March Dollar Index

I am still flat as the Dollar never came close to yesterday’s buy range as the market rose 0.8% on the Chinese Rate cut. The Dollar has resistance from 107.00/107.60 where I will be an aggressive seller with a 108.05 tight stop. I will now raise my buy level to 105.00/105.60 with a higher 104.45 stop.

Cash DAX

My DAX plan worked well with the market trading lower to my 13740 buy level before rallying to my revised 13795 T/P level and I am now flat. Today, I will again be a buyer on any dip lower to 13640/13720 with a tight 13575 stop. I still do not want to be short the DAX at this time..

Cash FTSE

No Change. The FTSE has resistance from 7570/7630 where I will again be a seller with a tight 7685 stop. I still do not want to be long the FTSE at this time.

Dow Rolling Contract

Late in the New York session the Dow rallied to my 33920 sell level. I am still short with a now higher 33800 T/P level. I will add to this trade at 34120 while leaving my 34305 ‘’Closing Stop’’ unchanged. If any of the above levels are hit I will be back with a new update for my Platinum Members.

Cash NASDAQ 100

Just like the Dow above, the NDX traded higher to my initial 13680 small sell level. Overnight the NDX sold off to my 13630 revised T/P level and I am now flat. I will look to sell the NDX on any further rally to 13700/13900 with the same 14055 ‘’Closing Stop’’ unchanged. If I am taken short I will have a T/P level at 13580. If any of the above levels are hit I will be back with a new update for my Platinum Members.

September BUND

My Bund plan worked well with the market trading lower to my 155.10 buy level before rallying to my 155.70 T/P level and I am now flat. Today, I will again be a buyer on any dip lower to 154.60/155.30 with a wider 153.95 ‘’Closing Stop’’.

Gold Rolling Contract

After Gold traded lower to my 1774 buy level I emailed my Platinum Members to exit any long position at 1782 and I am still flat. Gold has support from 1745/1760 where I will be an aggressive buyer with a tight 1733 stop.

Silver Rolling Contract

Silver sold off shortly after I posted early yesterday morning, hitting my 20.20 buy level. I am still long with a now lower 20.65 T/P level. I will add to this position at 19.60 while leaving my 19.25 stop unchanged.