Despite Costco (COST) posting lower-than-expected quarterly earnings all three American Indexes surged on Friday, led by the 2.58% gain in the NASDAQ 100. The NDX has now rallied over 5% since NVIDIA released its earnings after the close on Wednesday evening. Costco consumers curtailed non-essential spending amidst ongoing inflation and economic uncertainties. The company, like other retailers, witnessed a decline in demand for high-margin products such as home furnishings, jewellery, toys, and electronics, as shoppers focused on purchasing essential items like packaged food and groceries. Office real estate investment trusts (“REITs”) are trading at their lowest levels since 2009. Namely, the S&P Composite 1500 Office REITs index has dropped 27% in 2023. The decline is largely due to the rise of remote work and financial pressures on businesses. Republicans and the White House are making progress on a deal to raise the U.S. debt limit to avoid a possible default. Negotiating teams for President Joe Biden and House Speaker Kevin McCarthy have been exchanging messages, and North Carolina Rep. Patrick McHenry stated that the issues dividing the two sides have decreased. According to recent data from the U.S. Bureau of Labour Statistics (“BLS”), weekly wages experienced a significant drop in 2022. The latest figures in the BLS’s Quarterly Census of Employment and Wages highlight a broader trend of labour-market softness (not captured in previous data) and a rare decline of 2.3% in the fourth quarter of 2022 (compared with the same period in 2021). These findings also incorporate factors like bonuses, stock options, and severance pay, which sets them apart from other wage measures. European Markets closed lower. Dutch Central Bank chief Klaas Knot stated in an interview that the European Central Bank (ECB) requires at least two additional interest rate hikes of 25 basis points each. Knot believes that market expectations of rate cuts in early 2024 are excessively optimistic. He emphasised that the anticipated rate hikes in June and July are already factored into current market pricing and that the inflation outlook is contingent upon these hikes. U.K. retailers saw a more robust recovery in April than anticipated, with sales rising by 0.5% compared to the previous month. In March, sales had experienced a larger-than-expected decline of 1.2%. This positive rebound in April suggests that consumers are displaying unexpected resilience despite facing financial constraints. Retail Sales have shown improvement in three out of the last four months, creating additional pressure on the Bank of England to consider raising interest rates in an effort to tackle persistent high inflation. In Asia, according to a recent Bloomberg survey of economists, China’s central bank is likely to reduce the reserve requirement ratio for major banks earlier than previously expected. The survey reveals that economists anticipate a 25-basis point cut in the ratio by the end of the third quarter of 2023. This potential move by the People’s Bank of China is seen as a response to a slowdown in the economic recovery. Elsewhere, Oil rose 0.80% while Gold closed higher by 0.20% on Friday.
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For anyone following my Platinum Service it made 170 points yesterday and is now ahead by 2592 points for May. April saw a gain of 3354 points while March closed with a gain of 6168 points. The Platinum Service made 3164 points in February, 4687 points in January 2054 points in December, 4789 points in November and a record 9619 points last October. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1900 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
The S&P 500 closed 1.30% higher at a price of 4205.
The Dow Jones Industrial Average closed 328 points higher for a 1.00% gain at a price of 33,093.
The NASDAQ 100 closed 2.58% higher at a price of 14.298.
The Stoxx Europe 600 Index closed 0.11% lower.
Yesterday, the MSCI Asia Pacific closed 0.80% higher.
Yesterday, the Nikkei closed 1.03% higher at a price of 31,233.
The Bloomberg Dollar Spot Index closed 0.20% higher.
The Euro closed 0.1% lower at $1.0710.
The British Pound closed 0.2% higher at 1.2354.
The Japanese Yen fell 0.3% closing at $140.45.
Germany’s 10-year yield closed 10 basis points lower at 2.44%.
Britain’s 10-year yield closed 3 basis points lower at 4.34%.
U.S.10 Year Treasury closed 1 basis points lower at 3.81%.
West Texas Intermediate crude closed 0.80% higher at $72.34 a barrel.
Gold closed 0.2% higher at $1946.10 an ounce.
This morning on the Economic Front we have U.K. Nationwide House Prices at 7.00 am, followed by Euro-Zone Economic Sentiment Indicator at 10.00 am. Next, we have U.S. Consumer Confidence at 3.00 pm. Finally, we have the Dallas Fed Manufacturing Business Index at 3.30 pm.
Cash S&P 500
The S&P surged on Friday as my suspicions that the underlying market would finally catch a bid came through. This move higher saw the S&P traded the whole of my buy range for a 4193 average short position before selling off to my 4188 revised T/P level. On Sunday night – 15 minutes before the Futures Markets re-opened at 11.00 pm- I emailed my Platinum Members to sell the S&P at 4230 before selling off to my 4215 T/P level and I am now flat. All the good news about a debt agreement is now priced into the market. The S&P has resistance from 4228/4243 where I will again be a seller with a wider 4261 ‘’Closing Stop’’. The S&P has support from 4170/4185. I will now raise my buy level to this area with a higher 4159 tight ‘’Closing Stop’’.
No Change. I am still long from last Tuesday at 1.0770 with the same 1.0820 T/P level. I will add to this position at 1.0700 while leaving my 1.0635 ‘’Closing Stop’’ unchanged.
June Dollar Index
No Change. I am still short from Thursday at 104.05 sell level with the same 103.60 T/P level. I will add to this position at 104.65 while leaving my 105.05 ‘’Closing Stop’’ unchanged. If any of the above levels are hit I will be back with a new update for my Platinum Members.
My DAX plan worked well. Yesterday after the European Markets opened the DAX was trading in my sell range, enabling me to go short at 16040. We finally sold off into the European Close. This move lower saw my 15950 revised T/P level triggered and I am now flat. Today, I will again be a seller from 16060/16160 with a higher 16235 ‘’Closing Stop’’.
I am still flat as the FTSE again struggled on Friday despite the surge in American Indexes. The FTSE has support from 7460/7540 where I will be a small buyer with a 7395 ‘’Closing Stop’’.
Dow Rolling Contract
The Dow is trading 400 points higher from where I marked prices early Friday morning. This move higher saw my 33030 T/P level triggered on my 32965 average long position and I am now flat. Today, I will be an aggressive buyer on any dip lower to 32700/32950 with a lower 32495 ‘’Closing Stop’’. I still do not want to be short the Dow at this time.
Cash NASDAQ 100
Completely Wrong! I have totally underestimated the effect of A.I. on technology stocks as the NDX has exploded by over 500 points since I posted early Friday morning. I was stopped out of my 13905 latest short position at 14275 for a huge 370-point loss. With the 14-Day RSI closing at 74 on Friday night I just cannot be a buyer of the NDX at these levels. History tells me that this does not end well. On Sunday night I emailed my Platinum Members to sell the NDX again at 14400. I am still short with a 14280 T/P level. I will add to this position at 14550 with a 14705 ‘’Closing Stop’’. If any of the above levels are hit I will be back with anew update for my Platinum Members.
My long Bund position worked well as the Bund rallied to my 133.75 T/P level on my 133.10 long position and I am now flat. Today, I will again be a buyer of the Bund on any dip lower to 132.60/133.40 with a higher 131.95 ‘’Closing Stop’’.
Gold Rolling Contract
My long 1944 Gold position worked well as the market rallied to my 1955 T/P level and I am now flat. Today, I will again be a buyer on any dip lower to 1916/1931 with a tight 1905 ‘’Closing Stop’’.
Silver Rolling Contract
No Change. I am still long at an average rate of 23.05 with no stop. I will now lower my T/P level to 23.70. If any of the above levels are hit, I will be back with a new update for my Platinum Members.