Markets Rise Slightly Ahead of FOMC, Lyft IPO

by Vlad Karpel | 03/19/2019, 00:03

Major U.S. indices are split today with the Nasdaq and S&P on track to close the day higher while the Dow continues to be held back by Boeing. Tomorrow, Federal Open Market Committee members will meet for a two-day meeting and decide on another short-term interest rate hike, look for Fed Chairman Powell press conference following Wednesday’s meeting for more details. Also worth following, European markets are slightly up after Commerzbank AG and Deutsche Bank AG announced their merger over the weekend while Lyft, over in the U.S., is due to announce their IPO. Notable earnings this week include FedEx, Tilray, Nike, and General Mills. SPY continues to trade above 200-day moving average of $274, currently trading at $281. If SPY drops below 200-day moving average some further downward momentum is expected. However, our long term data and outlook remains bullish. For reference, the SPY Seasonal Chart is shown below:

All three major U.S. indices finished last week in the green though Nasdaq and S&P were able to extend their 2019 gains easily while the Dow was stunned by Boeing’s recent fatal crash and investigation. Investigation on the Ethiopian Airlines Boeing crash continues, most nations, including the U.S., have grounded the airplane model involved in the crash. Tomorrow, FOMC members will meet to discuss policy update, though an interest rate hike is not expected. Powell will meet with the press following the two-day meeting, look for more details on the policy and state of the market to come in the press conference. A good number of economists have projected just one hike for 2019, and similarly only one in 2020.

Over in Europe, UK Parliament members continue to look for solutions head of the March 29th deadline while a major banking merger has markets on the rise. Top German and Dutch banks, Commerzbank and Deutsche Bank, announced their merger over the weekend to mostly positive sentiment. Shares of both banks are currently up over 4%. In the UK, major indices and assets remained positive to start the week, though the pond continues to lower due to Brexit uncertainty.

This week, and as early as today, Lyft is expected to announce their IPO, presumed to be north of $2 billion and valued in the $20-25 billion range. The second largest ride-sharing company recorded a net loss of $900 million in 2018 and is expecting to shares to sell in the range of $65-68 to start out. Also worth following this week, several big name companies set to report earnings including Nike and FedEx. Economic reports for the week include Durable Goods Orders, Factory Orders, Manufacturing PMI, and Home Sales for the month of February.

Using the “^GSPC” symbol to analyze the S&P 500, our 10-day prediction window shows mixed signals. Today’s vector figure of +0.06% moves to -1.20% in five trading sessions. Prediction data is uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.

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Highlight of a Recent Winning Trade

On March 12th, our ActiveTrader service produced a bullish recommendation for Apple Inc (AAPL). ActiveTrader is included in all paid Tradespoon membership plans and is designed for day trading.

Trade Breakdown

AAPL entered its forecasted Strategy B Entry 1 price range $178.90 (± 1.01) in its first hour of trading and passed through its Target price $180.69 in the first hour of trading, reaching a high of 181.98. The Stop Loss price was set at $177.11.

Tuesday Morning Featured Stock

*Please note: Our featured stock is part of your free subscription service. It is not included in any paid Tradespoon subscription service. Vlad Karpel only trades his own personal money in paid subscription services. If you are a paid subscriber, please review your Premium Member Picks, ActiveTrader or MonthlyTrader recommendations. If you are interested in receiving Vlad’s personal picks, please click here.

Our featured stock for Tuesday is Cisco Systems Inc (CSCO). CSCO is showing a confident vector trend in our Stock Forecast Toolbox’s 10-day forecast. This stock is assigned a Model Grade of (B) indicating it ranks in the top 25th percentile for accuracy for predicted support and resistance, relative to our entire data universe.

The stock is trading at $53.45 at the time of publication, with a +0.99% vector figure.

Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.

Note: The Vector column calculates the change of the Forecasted Average Price for the next trading session relative to the average of actual prices for the last trading session. The column shows expected average price movement “Up or Down”, in percent. Trend traders should trade along the predicted direction of the Vector. The higher the value of the Vector the higher its momentum.

Oil

West Texas Intermediate for April delivery (CLJ9) is priced at $59.13 per barrel, up 1.04% from the open, at the time of publication. Looking at USO, a crude oil tracker, our 10-day prediction model shows positive signals. The fund is trading at $12.34 at the time of publication, up 1.00% from the open. Vector figures show +0.12% today, which turns +2.98% in five trading sessions. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.

Gold

The price for April gold (GCJ9) is down 0.02% at $1,302.80 at the time of publication. Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows mostly negative signals. The gold proxy is trading at $122.975, up 2.36% at the time of publication. Vector signals show -0.27% for today. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.

Treasuries

The yield on the 10-year Treasury note is up 0.24% at 2.60% at the time of publication. The yield on the 30-year Treasury note is up 0.05% at 3.02% at the time of publication.

Using the iShares 20+ Year Treasury Bond ETF (TLT) as a proxy for bond prices in our Stock Forecast Tool, we see positive signals in our 10-day prediction window. Today’s vector of +0.09% moves to +0.85% in three sessions. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.

Volatility

The CBOE Volatility Index (^VIX) is up 2.17% at $13.16 at the time of publication, and our 10-day prediction window shows mixed signals. The predicted close for tomorrow is $12.68 with a vector of +2.73%. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.