Vaccine optimism once again sent U.S. Equity Markets to all-time high, led by the Dow which closed just below 30,000 with a gain of 1.60%. Moderna said that the vaccine met its primary endpoint for efficacy. MRNA also said that its vaccine was 94.5% effective in the trials. The company said it will apply for emergency use authorisation in the coming weeks. Just like Pfizer and BioNTech’s release last week, this news sparked optimism that we could return to normal in the near future. In terms of Economic data, Empire Manufacturing data fell short of estimates, but the survey showed that manufacturers still have high expectations for expansion in the coming months. Federal Reserve Vice Chair Richard Clarida said the central bank is still committed to supporting the economy by using all of its available tools. While this is nothing new, it reinforces that more stimulus could be on the way if the economy slows again. European Indices again closed higher. German Chancellor Angela Merkel and the heads of the country’s 16 states were said to be considering stricter measures to try and contain the Coronavirus resurgence. The French government came under increasing pressure to ease lockdown measures as Catholics demanded the allowance of religious mass once more. Germany’s Bundesbank said the nation’s economy could see no growth or contract in the fourth quarter due to new Coronavirus restrictions, but a pullback like the one we experienced this past spring is unlikely. Elsewhere, Oil closed 3% higher, on growth optimism after Moderna’s positive release on a COVID-19 vaccine, while Gold closed flat after a volatile trading session.
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For anyone following my Platinum Service it made 170 points yesterday and is now ahead by 1392 points for November having made 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, an incredible 9264 points in March, 2223 points in February and 2142 points in January. 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 1.16% higher at a price of 3627.
The Dow Jones Industrial Average closed 470 points higher for a 1.60% gain at a price of 29,950.
The NASDAQ 100 closed 0.63% higher a price of 12,013.
The Stoxx Europe 600 Index closed 0.5% higher
The MSCI Asia Pacific Index rose 0.4%.
Yesterday, the Nikkei closed 2.05% higher at a price of 25,907 – A NEW 29 YEAR HIGH
The Bloomberg Dollar Spot Index closed 0.2% lower.
The Euro closed 0.2% higher at $1.1858.
The British Pound closed unchanged at $1.3198.
The Japanese Yen closed unchanged at 104.60 per dollar.
The yield on 10-year Treasuries closed two basis points higher at 0.92%.
Germany’s 10-year yield closed one basis point higher at -0.54%.
Britain’s 10-year yield closed one basis point higher at 0.35%.
The Bloomberg Commodity Index closed 0.3% higher.
West Texas Intermediate closed 3.03% lower at $41.17 a barrel.
Gold closed unchanged at $1881 an ounce.
This morning on the Economic Front we have Euro-Zone Construction Output at 10.00 am and this is followed at 1.30 pm by U.S Retail Sales and the Import/Export Price Index. At 2.15 pm we have Industrial Production and Capacity Utilisation. Finally, at 3.00 pm we have Business Inventories and the NAHB Housing Market Index.
Meanwhile ECB President Lagarde and Fed Chairman are speaking at 5.00 pm and 7.00 pm respectively.
December S&P 500
Frustratingly, the S&P just missed my 3583 buy level with a 3595 low print before rallying to close near the high of the day at 3624. This move higher has left another ‘’Open Gap’’ from Friday’s 3581 Chicago close to yesterday afternoon’s 3595 low print. This is the sixth ”Open Gap” left already for November which is something that I have not witnessed before and gives you an idea of overvalued this market is. Meanwhile after a volatile session the VIX closed 2.8% lower at 22.45, – twenty points below its pre-election high and is now severely oversold. While the Dow closed made a new all-time high both the S&P and NASDAQ did not. The Advisors Survey (AAII) showed nearly 56% of investors are bullish. Only 25% are bearish. This is the highest level of bulls since January 2018 – right before the market suffered a strong correction. The S&P has resistance from 3642/3657 where I will be a seller with a 3671 stop which is just above last Monday’s all-time high. I will continue to be a buyer on any dip lower to 3567/3583 with the same 3552 ‘’Closing Stop’’.
The Euro just missed my 1.1805 buy level with a 1.1814 low print and I am still flat. I will now raise my buy level slightly to 1.1780/1.1820 with a higher 1.1735 stop.
December Dollar Index
I am still flat and I will now lower my buy level to 91.80/92.20 with a lower 91.35 stop.
I am still flat and today I will lower my buy level slightly to 12910/13005 with a lower and tight 12845 stop. If I am taken long I will have a T/P level at 13065.
The recent rally in the FTSE has now extended to over 900 points in the past two weeks as thankfully we were not short. The FTSE has resistance from 6470/6530 where I will be a seller with a 6575 stop.
Dow Rolling Contract
The Dow made a new high yesterday at 29,964 which was 30 points above last Monday’s previous all-time high. It is only a matter of time before we take out the key 30,000 resistance level. As a result I will now raise my sell level to 30200/30400 with a higher 30545 ‘’Closing Stop’’. I will now raise my buy level to 29350/29550 with a higher 29175 stop. If I am taken short I will have a T/P level at 30040. If I am taken long I will have a T/P level at 29705.
I was lucky with my NASDAQ call as the market traded lower to my 11850 buy level before rallying to my 11930 T/P level and I am now flat. As long as the NASDAQ does not break and close below 11800 I will continue to be a small buyer on dips. Today my buy level will be from 11790/11890 with a 11695 stop.
The BUND just missed my 174.30 initial buy level and I am still flat. Today, I will leave my 173.80/174.30 buy level with the same 173.25 stop. If I am taken long I will have a T/P level at 174.65.
Gold Rolling Contract
My Gold plan worked well with the market trading lower to my 1857 buy level before rallying to my 1866 T/P level and I am still flat in what turned out to be a volatile trading session. Today my buy level will be from 1845/1861 with an 1833 stop.
Silver Rolling Contract
No Change as I am still a buyer from 23.50/24.10 with the same 22.95 stop.