U.S. Equity Markets ended last week at new all-time highs, with the Dow leading the charge, closing higher by 0.49%. Strong economic data continued to provide a tailwind for markets. Housing Starts and Building Permits rose more than expected in March, signalling that the housing market remains strong despite rising prices and higher mortgage rates. And Consumer Sentiment rose again, hitting the highest level in more than a year as people become more optimistic on the pace of vaccinations and economic growth. Earnings season remains a catalyst, with S&P 500 earnings rising 30% so far in the quarter, up from a 24.5% growth rate earlier in the week. This will continue to be a closely watched trend in the coming weeks. European Markets surged on Friday. European Parliament voted in favour of ratifying the trade deal between Britain and the European Union, moving it a step closer to approval before the late April deadline. European car sales data for March hit the highest level since June 2019, in a sign of strengthening consumer demand. Italy’s debt burden is set to hit its highest level ever this year, as the country borrows more money to kickstart economic growth. Italy also gave a timetable for the lifting of restrictions, saying that most of the country should reopen in some capacity after April 26. In Germany, Chancellor Angela Merkel continued to push for more control over coronavirus restrictions, saying that the national government should have the power to classify hotspots and set restrictions. China’s First-Quarter Gross Domestic Product data were in line with expectations, growing by a record 18.3%, but quarter-over-quarter data indicated a slowing pace. Japanese Prime Minister Yoshihide Suga arrived in the U.S. for talks with President Joe Biden, where the two are expected to discuss how to counter China’s growing presence. South Korea said President Moon Jae-in will meet with Biden next month in Washington, D.C. to discuss regional security concerns including China and North Korea. Elsewhere, Gold closed 0.52% higher on Dollar weakness, while Bitcoin fell 3% after Turkey’s central bank banned the use of cryptocurrencies. The sell-off in Bitcoin continued over the weekend and is now down 20% as I go to press.
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For anyone following my Platinum Service it made 205 points on Friday and is now ahead by 188 points for April, having ended March with an impressive gain of 3769 points, having made 3286 points in February, 2077 points in January, 2273 points in December, 2025 points in November, 2779 points in October, 3042 points in September and 2383 points in August. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1600 points
The S&P 500 closed 0.36% higher at a price of 4185.
The Dow Jones Industrial Average closed 164 points higher for a 0.49% gain at a price of 34,200.
The NASDAQ 100 closed 0.11% higher at a price of 14,041.
The Stoxx Europe 600 Index closed 0.6% higher.
Last Friday, the MSCI Asia Pacific Index rose 0.1%.
Last Friday, the Nikkei closed 0.14% higher at a price of 29,683.
The Bloomberg Dollar Spot Index closed 0.1% lower
The Euro closed 0.1% higher at $1.1981.
The British Pound closed 0.5% higher at $1.3841.
The Japanese Yen closed 0.1% lower at 108.85 per dollar.
Germany’s 10-year yield closed four points higher at -0.26%.
Britain’s 10-year yield closed four basis points higher at 0.77%.
US 10 Year Treasury closed two basis points higher at 1.59%.
West Texas Intermediate crude closed 0.54% lower at $63.02 a barrel.
Gold closed 0.52% higher at $1,776.10 an ounce.
This morning on the Economic Front we have Euro-Zone Current Account and Construction Spending at 9.00 am and 10.00 am respectively. There is no other data of note on either side of the Atlantic.
June S&P 500
My S&P plan worked well on Friday with the market trading higher to my 4174 sell level before selling off to my 4165 revised T/P level. Subsequently, I emailed my Platinum Members to sell the S&P again into the close at 4180. With Bitcoin falling 20% over the weekend, the S&P gapped lower to my 4164 T/P level and I am now flat. With the S&P trading at an unprecedented three Standard Deviations above the mean this market is ripe for a sell-off. The S&P has resistance from 4180/4195 where I will again be a seller with a 4211 ‘’Closing Stop’’. Meanwhile, my only interest in buying the S&P is still on a dip lower to 4120/4135 with a ‘’Closing 4105 Stop’’. If I am taken short I will have a T/P level at 4169. If I am taken long I will have a T/P level at 4147.
Shortly after I posted early Friday morning the Euro was trading at my 1.1950 buy level before rallying to my 1.1980 T/P level and I am still flat. The Euro has support from 1.1900/1.1940 where I will again be a buyer with a 1.1865 stop. I still do not want to be short the Euro at this time. If I am taken long I will have a T/P level at 1.1970.
June Dollar Index
No Change. I am still a buyer from 91.00/91.40 with the same 90.65 stop. If I am taken long I will have a T/P level at 91.70.
My Dax plan did not work well as I was stopped out of my 15390 average short position on the New York close at 15505 and I am still flat. This is frustrating with European Indices expected to open lower this morning. The DAX has resistance from 15550/15630 where I will again be a seller with a 15705 stop. If I am taken short I will have a T/P level at 15505.
No Change. I am still short from last Thursday at 6940 with the same 6915 T/P level. I will continue to add to this position on any further move higher to 7000 while leaving my stop unchanged at 7035. If any of the above levels are hit I will be back with a new update for my Platinum Members.
Dow Rolling Contract
I did a lot of research over the weekend. One staggering statistic stood out, showing the inflows into the US Stock Funds since last November has exceeded the total of the previous twelve years at $569 billion versus $452 billion previously. Obviously the money is coming from Federal Reserve and Government Stimulus resulting in the Buffet Indicator (Total Market Cap divided by GDP) at its most extreme level ever at over 201%. We do not know when this overdue correction is coming but as we have seen with Bitcoin falling 20% over the weekend how risky equity markets are at this time. I am still short the Dow at 33970 with the same 34205 ‘’Closing Stop’’. I will now raise my T/P level on this position to 33950 and if any of the above levels are filled I will be back with a new update for my Platinum Members.
The NASDAQ sold off to my revised 13960 T/P level on my latest 14000 short position and I am still flat. This morning the NASDAQ is trading lower at 13950. We have resistance from 14020/14100 where I will again be a seller with a 14195 ‘’Closing Stop’’. I still do not want to be long the NASDAQ at this time. If I am taken short I will have a T/P level at 13970.
I am still flat the Bund as the market only had a small sell-off on Friday. We have support from 169.90/170.40 where I will be a buyer with a 169.45 stop. I still do not want to be short the Bund at this time. If I am taken long I will have a T/P level at 170.70.
Gold Rolling Contract
No Change. I am still flat and I refuse to chase the price of Gold higher. Therefore, my 1730/1745 buy level remains unchanged with the same 1718 stop. If I am taken long I will have a T/P level at 1752.
Silver Rolling Contract
I am still flat and just like Gold above I will leave my 24.80/25.40 buy level unchanged with the same 24.35 stop. If I am taken long I will have a T/P level at 25.70.
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