U.S. Equity Markets closed higher yesterday led by the 2.45% gain in the Russell 2000. This move higher saw the VIX close lower by 2.71% The Employment Cost Index for the fourth quarter showed cooler-than-expected wage growth, fuelling hopes that wage inflation has peaked, while the Consumer Confidence Index for January fell more than anticipated. However, the readings for current business conditions and labour market conditions showed improvement. Investors are expecting to get some pushback from Federal Reserve Chairman Jerome Powell – amid recent optimism for a dovish Fed – heading into today’s rate policy meeting. Earnings season continued Tuesday with a mixed bag of results. But the primary narrative observed among major companies continues to point toward easing supply-chain pressures and lower input costs. Within the S&P 500 Index, all the 11 sectors finished higher. European Markets closed mixed. The latest survey from the European Central Bank showed that banks have tightened credit requirements to the most restrictive levels since the 2011 debt crisis. The Bank of England’s latest credit data release shows that U.K. mortgage approvals fell in December to the lowest levels since 2009 (excluding 2020). German Retail Sales for December declined more than anticipated, falling 5.3% month over month, compared with a marginal expected decline of 0.2%. The reduced consumer spending was driven by an increase in food and energy prices. CPI for France in January showed a 0.4% increase over the month, with pricing pressures predominantly driven by higher food and energy prices. Finally, Euro-Zone GDP for the fourth quarter showed that the region has narrowly avoided a recession – despite double-digit inflation with GDP unexpectedly growing by 0.1%. In Asia, International Monetary Fund revised 2023 growth forecasts higher for China – up to 5.2% from 4.6%, while India’s Finance Ministry is expected to target a growth rate of 6.5% for the next fiscal year, marking the third consecutive potential year of slower growth. Elsewhere, Oil rose 1.55% while Gold closed 0.23% higher after finding strong support at $1900.
To mark my 2700th 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 firstname.lastname@example.org for details
For anyone following my Platinum Service it made 755 points yesterday, closing January with a gain of 4687 points, after finishing December with a gain of 2054 points. November ended with a gain of 4789 points, while finishing October with a record gain of 9619 points, making 6660 points in September, after closing August with a gain of 2228 points, 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
The S&P 500 closed 1.45% higher at a price of 4076
The Dow Jones Industrial Average closed 368 points higher for a 1.09% gain at a price of 34,086.
The NASDAQ 100 closed 1.59% higher at a price of 12,101.
The Stoxx Europe 600 Index closed 0.17% lower.
This morning, the MSCI Asia Pacific rose 0.8%.
This morning, the Nikkei closed 0.072% higher at a price of 27,346.
The Bloomberg Dollar Spot Index closed 0.2% lower.
The Euro closed 0.2% higher at $1.0873.
The British Pound closed 0.3% lower at 1.2327.
The Japanese Yen rose 0.2% closing at $130.15.
Germany’s 10-year yield closed 3 basis points lower at 2.29%.
Britain’s 10-year yield closed 1 basis points lower at 3.33%.
U.S.10 Year Treasury closed 3 basis points lower at 3.51%.
West Texas Intermediate crude closed 1.55% higher at $79.11 a barrel.
Gold closed 0.23% higher at $1924.10 an ounce.
This morning on the economic front we have German, Euro-Zone and U.K. Manufacturing PMI at 8.55 am, 9.00 am and 9.30 am respectively. This is followed by Euro-Zone CPI and Unemployment Rate at 10.00 am. Next, we have U.S. MBA Mortgage Applications at 12.00 pm and the ADP Employment Index at 1.15 pm. At 2.45 pm we have Manufacturing PMI. This is followed at 3.00 pm by JOLTS Job Openings, Construction Spending and ISM Manufacturing PMI. Finally, we have FOMC Statement and Powell Press Conference at 7.00 pm and 7.30 pm respectively.
Cash S&P 500
The positive divergence that I saw in both the S&P and NDX on their respective 15-minute charts certainly worked well yesterday as yet again all dips have been bought making it even more uncomfortable for anyone who was short into the new -year. As every dip gets bought, we are now in a situation where resistance is now key support. However, with the $NYSI maximum overbought there is every chance that Powell could be more hawkish than expected this evening. The McClellan Oscillator closed at +147 last night leaving room for a further 2-3 day rally before this key signal becomes overbought. My strategy will be to be a small seller on any aggressive rally from here as I pointed out yesterday that the Seasonal Chart sees a small sell-off into the first week of February before ripping higher to April. I am conscious that we have had an excellent start to the year and I want to protect these gains as well. Yesterday my S&P plan worked well with the market trading lower to my 4000 buy level with a 3993 low print before rallying almost 90 Handles off this low print. Unfortunately, I covered this position too early at 4020 and I am still flat. The S&P has support from 4030/4045 where I will be a buyer with a 4017 tight ‘’Closing Stop’’. We have resistance from 4120/4137 where I will be a seller with a 4151 ‘’Closing Stop’’.
I am still flat the Euro which continues to consolidate above 1.08. The Euro has traded in a 100-point range for most of the past week. Today, I will continue to be a buyer from 1.0710/1.0780 with the same 1.0645 ‘’Closing Stop’’. The Euro has resistance from 1.0940/1.1000 where I will be a strong seller with a higher 1.1065 ‘’Closing Stop’’.
March Dollar Index
No Change. I am still long at an average rate of 102.10 with the same 101.35 ‘’Closing Stop’’. I will now lower my T/P level to 102.35. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
No Change. The DAX continues to struggle above 15200. I am reluctant to be a seller given the positive price action over the past three months. The DAX has support from 14900/14980. I will now raise my buy level to this area with a higher 14815 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 15050.
My FTSE call worked well as the market traded lower to my 7710 buy level before rallying to my 7760 T/P level and I am now flat. Ahead of the FOMC Meeting I will not chase the market higher, continuing to be a strong buyer on any dip lower to 7650/7720 with the same 7595 ‘’Closing Stop’’. I still do not want to be short the FTSE at this time.
Dow Rolling Contract
Incredible price action in the Dow over the past 24 hours as both my buy range and sell range were executed. After the Dow hit my 33580 buy level we rallied to my 33810 revised T/P level. The Dow surged in the last 20 minutes of trading hitting my sell range for a 34080 short position. This morning the Dow had a small sell-off and as I want to get February off to a positive start I emailed my Platinum Members to exit any short position at 33995 and I am now flat. These points will be taken in February. Today will all be about the Fed announcement at 7.00 pm followed by the Powell press conference at 7.30 pm. With every dip being bought, bears need Powell to deliver a bearish message, otherwise all dips will continue to be bought. The Dow has support from 33500/33750 where I will be a strong buyer with a 33395 tight ‘’Closing Stop’’. The Dow has resistance from 34400/34650 where I will be a small seller with a 34905 wider ‘’Closing Stop’’.
Cash NASDAQ 100
The positive divergence that I noticed on the 15 minute chart for the NDX worked a treat as the market rallied to my 11980 T/P level on yesterday’s 11890 long position. For those members who were not long the NDX sold off to a low at 11815 before rallying nearly 300 points. This move higher saw the NDX close above its 200 Day Moving Average (11981). Today, I will be a strong buyer from 11800/11950 with a higher 11655 ‘’Closing Stop’’. I still do not want to be short the NDX at this time.
No Change. I am still long at 136.80 with the same 137.30 T/P level. I will now raise my stop to 136.05 ‘’Closing Price’’. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
I have patiently waited to buy Gold which obliged yesterday morning, hitting my 1905 buy level before rallying to my 1916 T/P level and I am now flat. This morning, Gold is trading higher at a price of 1925. Ahead of the FOMC Statement I will not chase Gold higher, continuing to be a buyer on any dip lower to 1890/1905 with the same 1879 ‘’Closing Stop’’.
Silver Rolling Contract
My Silver plan worked really well yesterday as the market traded lower to my 23.10 buy level before rallying to my 23.75 T/P level and I am now flat. I will look to buy Silver again from 22.70/23.40 with the same no stop policy.