U.S. Equity Markets rose as investors focused on signs of economic recovery amid further tension with China, lackluster virus drug-test results and spreading protests over the killing of George Floyd, an unarmed black man, by police. The US Dollar slumped. The tech-heavy Nasdaq Composite outperformed as a closely watched measure of U.S. Manufacturing rose in May for the first time in four months, suggesting stabilisation after a pandemic-driven plunge. Gunmakers rallied in the aftermath as the protests were marred by violence. Gilead Sciences Inc. fell after its drug remdesivir showed only a limited benefit in a large trial. Risk assets showed signs of resilience Monday after stocks had dipped earlier in the day following reports that Chinese officials had told agricultural companies to pause purchases of some U.S. farm goods, threatening a hard-won trade deal. Metals and Emerging-Market equities advanced along with shares in Europe and Asia. Investors mostly looked past the weekend of sometimes violent demonstrations across U.S. cities, highlighting what many see as the disconnect between Wall Street and Main Street. Stocks are near a three-month high as businesses reopen following shutdowns caused by the Coronavirus, even with 40 million Americans having filed for Unemployment benefits. Goldman Sachs Group Inc. said the U.S. labour market is showing the earliest signs of rebounding. China’s Caixin purchasing managers’ index for manufacturing rose above 50 May, indicating an expansion. Euro-area data on Monday also signalled factories have started down their long road to recovery.
To mark my 2075th 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 email@example.com for details
For anyone following my Platinum Service it made 617 points yesterday on the first trading session for June having made 2456 points in May, 4773 points in April, an incredible 9264 points in March, 2223 points in February, 2142 points in January and 818 points in December. 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 Index rose 0.4%, closing at a price of 3055.
The Dow Jones Industrial Average closed 91 points higher at 25,475.
The NASDAQ 100 closed 0.45% higher at a new recovery high at 9599.
The Stoxx Europe 600 Index climbed 1.1%.
Hong Kong’s Hang Seng Index increased 3.4%.
The MSCI Asia Pacific Index increased 1.8%.
This morning the Nikkei closed 1.20% higher at 22,325.
Here is a summary of the main Changes in F.X Markets:
The Bloomberg Dollar Spot Index declined 0.7%.
The Euro rose 0.3% to $1.1133.
The British Pound gained 1.3% to $1.2503.
The Japanese Yen strengthened 0.2% to 107.6 per dollar.
The yield on 10-year Treasuries rose one basis point to 0.66%.
Germany’s 10-year yield increased four basis points to -0.41%.
Britain’s 10-year yield climbed five basis points to 0.23%.
West Texas Intermediate crude rose 0.3% to $35.59 a barrel.
Gold strengthened 0.6% to $1,740.17 an ounce.
This morning on the Economic Front we have UK Consumer Credit, Mortgage Approvals, Net Lending to Individuals and Money Supply at 9.30 am. This is followed at 2.45 pm by the ISM New York which is the only U.S data to be released this afternoon.
June S&P 500
The S&P did close above the 3021/3030 resistance area mentioned last week. This resistance area did contain the S&P from July to October 2019 before we saw the final acceleration in the market to February’s 3393 all-time high. The S&P has a large ‘’open Gap’’ at 3075/3130 from the close on March 4 and the open on March 5. As we know all ‘’Gaps’’ eventually are filled and given how large this Gap is I would expect at least some of this will be filled over the coming days. Today, I will be a strong seller from 3090/3125 with a 3141 stop. Since my Daily Commentary was posted on Friday we have had some spectacular gains in the market. After the S&P tested the 50- Day Moving Average where I bought the market at 3005 before we rallied to my 3012 revised T/P level. Subsequently I Emailed my Platinum Members to re-buy the market again at 2993 before we rallied again to my 3305 T/P level. After we waited for President Trump’s press conference in which he said nothing too negative on China the S&P surged into the close to hit my 3055 sell level. When the Futures re-opened on Sunday night the escalating riots across America saw the market open at my 3027 T/P level and I am now flat. The S&P has strong support from 3008/3025 where I will be a buyer with a 2991 wider stop which is just below last Friday’s low print.
After the Euro traded higher to my 1.1150 sell level we saw a quick 30 point drop. As I am still long the Dollar I covered this position at my revised 1.1140 T/P level and I am still flat. The Euro has further resistance from 1.1190/1.1240 where I will again look to sell with a 1.1285 stop. I will now raise my buy level to 1.1010/1.1060 with a 1.0965 stop.
June Dollar Index
Overnight the Dollar traded lower to my second buy level at 97.80. I am now long at an average rate of 98.10. I will leave my stop unchanged at 97.55 while lowering my T/P level to 98.25. If any of the above levels are hit I will be back with a new update for my Platinum Members.
The DAX has traded a wide range over the past two trading sessions. Yesterday after the DAX hit my 11815 sell level we saw a quick 140 point sell-off. Unfortunately, I covered this position too early at 11780 and I am now flat. The DAX reversed earlier losses to close at a new recovery high above 11900. The DAX has resistance from 11995/12100 where I will be a seller with a tight 12165 stop. I will now raise my buy level to 11520/11670 with a 11445 stop.
No Change as I am still a seller from 6240/6290 with the same 6340 stop. I still do not want to be long the FTSE at this time.
Dow Rolling Contract
The Dow continue to lag both the NASDAQ and S&P. On top of this the 200-Day Moving Average is nearly 800 points above current prices at 26295. I am still flat and I will continue to be a seller from 25700/26000 with the same 26155 stop. The Dow has support from 24950/25200 where I will be a buyer with a 24775 stop.
Late on Friday the NASDAQ hit my 9520 sell level. As I wanted to be flat ahead of the Trump press conference I emailed my Platinum Members to exit this position at 9505. Subsequently I emailed them again to go short at a price of 9600, which was filled just before last night’s close. Thankfully the NASDAQ traded lower overnight to my 9560 T/P level and I am now flat. This morning we are back at the 9600 area, which incredibly is only 150 points below all-time highs. One of the main contributors to this aggressive move in the NASDAQ is Apple. Apple now has a market cap of $1.4 trillion with a forward multiple of 26.8. This is a 30% increase in multiple in just 2.5 months. Not on better earnings, not on better growth, no, on exactly the opposite. Investors are now paying a 30% premium on the stock versus February based on a new fundamental picture which is weaker than before. Apple is severely overbought. This is the third Quarter in a row that Apple is extending above its Quarterly Bollinger Band. Similar repeated extensions above that Quarterly Bollinger Band did result in corrections to the Quarterly 15 MA which is currently residing at $192, well below last night’s close at $322. Keep a close eye on Apple as investors may want to keep that history in mind when chasing a stock to all-time highs at a multiple price inflation of 30% in 2.5 months. If Apple cracks then so will the U.S Markets. The NASDAQ has strong resistance from 9660/9780 where I will again look to sell with a 9885 stop.
My Bund plan worked well with the market trading lower to my 171.60 buy level before rallying to my revised 171.87 T/P level and I am now flat. With the Central Banks having nationalised the Bond Markets thee is no point in being short and I will continue to be a buyer on dips. Today, my buy level will be from 171.20/171.60 with a 170.85 stop.
Gold Rolling Contract
I am still flat and I will now raise my buy level to 1700/1712 with a 1691 stop.
Silver Rolling Contract
Despite the Daily Sentiment Reading at 90% bulls, Silver has continued its 50% rise since March. I am still flat and today I will raise my buy level to 17.30/17.75 with a 16.95 stop.